Bank of the Ozarks in Little Rock, Ark., reported a rise in third-quarter profits as net interest income reached a record high and provisions for bad loans fell.
The $6.6 billion-asset company reported on Tuesday afternoon that net income increased 21.3% from a year earlier, to $32.1 million. Earnings per share of 40 cents beat by a penny the average estimates of analysts polled by Bloomberg.
Net interest income climbed 47% year over year, to an all-time high of $74.6 million, thanks largely to loan growth resulting from recent acquisitions. The net interest margin declined six basis points, to 5.49%, from the third quarter of 2013.
Noninterest income fell approximately 13%, to $19.2 million, as net gains from asset sales decreased roughly 33%, to $1.7 million. However, service charges on deposit accounts reached a record high of $7.4 million and mortgage lending income increased 35.4%, to $1.7 million.
Meanwhile, provision for loan and lease losses was $3.7 million in the third quarter, down $1 million from a year ago.
Noninterest expenses surged 32%, to $42.5 million, with acquisition-related costs totaling $1.4 million. Since July 2013, the company has completed acquisitions for First National Bank of Shelby, Bancshares, and Summit Bancorp. The bank also announced in July that it is buying New York-based Intervest Bancshares. That deal is expected to close in the first quarter of next year.