Home BancShares, the parent company of Centennial Bank, had net income of $80.3 million in the third quarter, more than five times the $14.8 million it earned for the same period last year, the Conway-based firm said Thursday.
The bank earned 46 cents per share in the third quarter, more than 4.5 times the 10 cents a share it earned in the third quarter last year and better than the 45 cents a share projection of nine banking analysts surveyed by Thomson Reuters.
Shares of Home BancShares fell 66 cents to close Thursday at $20.09 in trading on the Nasdaq exchange.
The bank had $10.8 billion in total loans in the third quarter, up from $10.3 billion in the third quarter last year. It had $10.6 billion on Sept. 30, up from $10.4 billion a year earlier.
The $80.3 million profit in the third quarter was a record, said John Allison, Home BancShares' chairman.
Net income for the quarter was driven by good fee income of $25.8 million, up from $21.3 million in the third quarter last year, said Matt Olney, a banking analyst in Little Rock for Stephens Inc.
The third quarter was the first full quarter with Shore Premier Finance, said Tracy French, chief executive officer for Centennial. Shore Premier Finance provides loans for the purchase of U.S. Coast Guard-registered high-end sailboats and powerboats.
"Home BancShares had a good third quarter, logging record earnings along with continuing to control its overhead expenses," said Garland Binns, a Little Rock banking attorney.
The bank had an efficiency ratio of 37.23 percent, Binns noted. That means it costs Home BancShares $37.23 to earn $100.
Allison told several stories of bank employees or customers in the Florida panhandle who helped in the recovery efforts of Hurricane Michael this month.
"This storm was a bad one," Allison said. "Originally, some of our people had no food, no housing, no water and no clothes except the clothes on their back."
One customer from Pensacola, Fla., "purchased, loaded and delivered" two trucks filled with food, water, clothes, generators, fuel, chain saws and medical supplies, Allison said.
"[The bank customer] entered the places he was told by law enforcement not to enter, not stopping because his friend and banker, his family and employees were in dire need of help," Allison said.
Twenty-three of 27 branches in the hurricane's path have been reopened and another is scheduled to open today, Allison said. All of the bank's employees have been accounted for, he said.
With Home BancShares' stock price remaining at a relatively low price, the bank has increased its stock repurchase plan. The bank has bought back almost 2.2 million shares so far this year, Allison said.
"While [the stock] is on sale, we're going to buy it back," Allison said.
It will take one or two significant bank acquisitions in the marketplace to get Home BancShares back in the game of buying banks, Allison said.
There is one target Home BancShares has considered buying for 18 months, Allison said.
"It will straighten itself out at some point in time," Allison said. "We are a very disciplined acquirer."
Centennial Bank has 77 branches in Arkansas, 76 in Florida, five in Alabama and one in New York City. In this quarter, the bank plans to open a lending office in Dallas.
Business on 10/19/2018