Bank OZK ( NASDAQ: OZK ) stock has dropped 7.6% in Thursday after-hours trading after Q3 earnings missed the Wall Street estimate as it increased its provision for credit losses due to its loan growth.
"The growth in both funded and unfunded loan balances during the quarter contributed to the higher provision for credit losses, which impacted net income," the company said.
Its Real Estate Specialty Group's loan originations of $4.35B, marking its fourth straight quarter of record originations, increased from $3.53B in Q2.
Q3 EPS of $1.08, missing the consensus of $1.17, slipped from $1.10 in Q2 and increased from $1.00 in the year-ago quarter.
Q3 provision for credit losses was $39.8M, up from $7.0M in the previous quarter and a benefit of $7.5M a year earlier.
As with most banks, the Fed's rate-hiking cycle led to NII growth. Net interest income rose to $294.6M from $265.8M in Q2 and from $248.0M in Q3 2021; net interest margin ("FTE") of 5.03% vs. 4.52% in the previous quarter and 4.16% in the year-ago quarter.
Bank OZK's ( OZK ) total noninterest expense of $115.7M increased from $109.3M in Q3 and $110.4M in the year-ago quarter. Salaries and employee benefits expense of $57.4M rose from $54.4M in the prior quarter and $53.8M in the year-ago period.
Total loans were $19.51B vs. $18.74B at June 30.
Deposits of $20.4B, an increase from $19.98B at June 30.
Conference call on Oct. 21 at 11:00 AM.
Earlier, Bank OZK ( OZK ) GAAP EPS of $1.08 misses by $0.09, revenue of $323.78M beats by $18.69M
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Bank OZK stock slides after Q3 earnings miss on higher loss provision as loans grow