Home BancShares Net Profit Up 26%, Credit Growth Slowing


Home BancShares, parent company of Centennial Bank, reported second-quarter net income of $ 79.1 million, up 26% from the same 2020 quarter of $ 62.8 million. The gains, which beat the consensus forecast, occurred despite a fall of more than 12%. in quarterly loan proceeds.

Second-quarter earnings per share were 48 cents, better than the consensus of 46 cents by analysts following the company. Revenue for the quarter was $ 172.4 million, down from $ 173.7 million in the same quarter of 2020 and below the consensus estimate of $ 174.17 million.

Net income in the first half was $ 170.672 million, much more than $ 63.334 million in the same period in 2020.

“An annual look at gross revenues and net income before taxes and reserves (PPNR) shows that we have been doing well for the past four years,” Home BancShares Chairman John Ellison said in a profit statement released in early July 15) … “For the six months ended June 30, 2021, net income was $ 170.7 million, or $ 1.03 per share, a record for the Company. The consistent, steady performance that our team demonstrates every quarter brings a sense of pride and comfort in these turbulent economic times. ”

A combination of monetary stimulus from the Federal Reserve and Congress has reduced demand for consumer loans. Home BancShares reported a $ 579.3 million decrease in credit in the second quarter, with loan revenue of $ 141.684 million for the quarter, down 12.2% from the same period in 2020. Loan income for the first six months of the year was $ 292.601 million, up 7.7%. from the same period in 2020.

Centennial Bank President and CEO Tracy French said the bank will continue to adhere to its lending principles.

“One of the hardest things we do is maintain our discipline, and while credit growth may seem a little slow, we plan to be patient too, as we are not going to sell our company’s future. We will not be the type to try to find short-term gains in the market to create a long-term problem, ”said French in the income statement.

Below are other metrics in the income statement.
• At the end of the second quarter, the bank’s total assets were $ 17.627 billion, up from $ 16.895 billion at the end of the second quarter of 2020.

• The bank’s total deposits at the end of the second quarter were $ 13.891 billion, compared with $ 13.177 billion at the end of the second quarter of 2020.

• Return on assets, a key indicator in the banking sector, was 1.81% at the end of the second quarter, up from 1.55% in the second quarter of 2020.

• Non-performing loans as of June 30, 2021 were US $ 22.4 million, US $ 31.8 million, US $ 380,000, US $ 1.6 million and US $ 2.7 million in the markets of Arkansas, Florida, Alabama , Shore Premier Finance and Centennial CFG, respectively, for a total of USD 58.9 million.

The bank holding company has 76 branches in Arkansas, 78 branches in Florida, 5 branches in Alabama and one branch in New York. The bank’s shares (NASDAQ: HOMB) closed at $ 23.50 on Wednesday. Since the beginning of the year, the share price has increased by 20.4%. Over the past 52 weeks, the share price has ranged from $ 29.76 to $ 14.42.

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