Bank OZK’s stock has taken a serious hit on Wall Street today, losing over a quarter of its value in one day.
The Little Rock-based bank announced its third-quarter earnings for 2018 today, which showed a 22.7 percent decrease from the same time last year. Bank OZK’s net income for 2018’s third quarter was $74.2 million, and the earnings were common share were $0.58.
In the wake of the announcement, Bank OZK’s stock price fell from $34.85 at Thursday’s close to $25.49 when the market opened on Friday morning at 9:30 a.m. EST. The stock price ended up at 25.52 per share by the closing bell at 4 p.m. EST.
The closing stock price of $25.52 represents a decline of 9.33 points, or 26.77 percent of its market value. After hitting a low around 2:30 p.m. EST, the stock leveled back to the ending price.
Two charge-offs on Real Estate Specialties Groups (RESG) credits may have contributed to the stock price decline. These two charge-offs, which totaled $45.5 million combined, were on unrelated projects in North and South Carolina. According to the report, both of the projects have been in the bank’s portfolio since 2007-8, and were formerly classified as substandard.
In addition, the bank reported pretax expenses of $10.8 million during 2018’s third quarter as a result of its name change and rebranding. The bank changed its name from Bank of the Ozarks to Bank OZK on July 16, 2018. In the first nine months of 2018, Bank OZK had expenses of $11.4 million as a result of the name change.
Bank OZK reported $220.6 million in net interest income for the 2018 third quarter, which is a 5.2 percent increase from 2017’s third quarter total of $209.7 million. However, the third quarter total was a 1.8 percent decrease from 2018’s second quarter total of $224.7 million.
The bank trades on the NASDAQ Global Select Market under the symbol OZK.