HOMB Home BancShares Inc

Home BancShares, Inc. (NASDAQ GS: HOMB), parent company of Centennial Bank, released first quarter earnings today.

Highlights of the First Quarter of 2020:

Metric	Q1 2020			Q4 2019			Q3 2019			Q2 2019			Q1 2019
Net Income	$507,000			$73.3 million			$72.8 million			$72.2 million			$71.4 million
Total Revenue (net)	$162.7 million			$167.8 million			$167.7 million			$164.1 million			$163.1 million
ROA		0.01%			1.94%			1.93%			1.92%			1.92%
NIM		4.22%			4.24%			4.32%			4.28%			4.30%
Purchase Accounting Accretion	$7.6 million			$9.1 million			$8.5 million			$9.2 million			$9.1 million
ROE		0.08%			11.71%			11.84%			12.18%			12.34%
ROTCE (non-GAAP)(1)		0.14%			19.55%			20.04%			21.01%			21.53%
Diluted Earnings Per Share	$0.00			$0.44			$0.44			$0.43			$0.42
Non-Performing Assets to Total Assets		0.44%			0.43%			0.45%			0.51%			0.52%
Common Equity Tier 1 Capital		11.6%			12.4%			12.2%			11.6%			11.4%
Leverage		10.8%			11.3%			10.9%			10.5%			10.2%
Tier 1 Capital		12.1%			13.0%			12.8%			12.2%			12.0%
Total Risk-Based Capital		15.8%			16.4%			16.2%			15.5%			15.4%
Allowance for Credit Losses to Total Loans		2.01%			0.94%			0.97%			0.96%			0.97%

(1) Calculation of this metric and the reconciliation to GAAP are included in the schedules accompanying this release.

“The earnings power of HOMB has really shone through this quarter,” said John Allison, Chairman. “After $95 million of noise, most of which were non-cash expenditures, to still be profitable is remarkable,” continued Allison.

“Banking is an essential business and no doubt a backbone to the American economy,” said Tracy French, Centennial Bank President and Chief Executive Officer. “It’s been amazing to watch our team of bankers push through thousands of loans totaling just under $1 billion dollars in about ten days to assist our customers through the Paycheck Protection Program,” French continued.

Operating Highlights

During the first quarter of 2020, the Coronavirus (“COVID-19”) pandemic has had a significant impact on global markets driven by supply chain and production disruptions, workforce restrictions, travel restrictions, retail closures, and reduced consumer spending and sentiment, amongst other factors.  The potential global and economic impacts of the coronavirus continue to evolve rapidly and HOMB is continuing to closely monitor the situation.

During the quarter, we had a lot of net income noise compared to previous quarters.  The most significant noise is related to COVID-19.  As a result of COVID-19, the Company recorded a $71.7 million provision for credit losses, a $7.8 million expense for the increase in our unfunded commitment reserve, an $842,000 provision for credit losses on investment securities, and a $5.8 million write-down for the fair value adjustment on marketable securities.  This was the first quarter under which the Company began accounting for credit losses under Accounting Standards Codification (ASC) 326, Financial Instruments – Credit Losses, which increased the loan provision by $5.0 million.  We incurred $10.0 million of expense as a result of our LH-Finance acquisition, which we completed on February 29, 2020, including $9.3 million for the provision for credit losses and $711,000 of acquisition expenses.  The acquired loan portfolio is now housed in our Shore Premier Finance division.  The Company also had $1.1 million of expense for outsourced special projects and $7.0 million of special dividend income from one of our equity investments.  The summation of all these items resulted in net additional expense of  $95.2 million, or $70.3 million after tax.  Excluding these items, our net earnings, as adjusted (non-GAAP), for the quarter ended March 31, 2020 were $70.8 million, or $0.43 diluted earnings per share, compared to $73.1 million, or $0.44 diluted earnings per share, for the quarter ended December 31, 2019.(1)

The Company adopted ASC 326 (“CECL”) as of January 1, 2020.  The adoption of this standard increased the opening balance for the allowance for credit losses by $44.0 million.  The new CECL accounting standard requires that both a discount and an allowance for credit losses be recorded on loans during an acquisition.  This is commonly referred to as “double accounting.”  During the first quarter, we completed the acquisition of $406.2 million of loans from LH-Finance.  As a result, we recorded a $6.2 million loan discount and a $9.3 million increase in the allowance for credit losses for the double accounting for this acquisition.____________________(1) Calculation of this metric and the reconciliation to GAAP are included in the schedules accompanying this release

During the first quarter of 2020, we recorded $86.8 million of total credit loss expense.  This expense is comprised of the following components – investment securities, CECL double accounting for LH-Finance, CECL loan provision and CECL COVID-19 loan provision.   We recorded $842,000 for credit losses on investments related to our sales tax bonds with lower coverage ratios.  The CECL double accounting for LH-Finance was $9.3 million.  The normal CECL loan provision was approximately $5.0 million and the CECL COVID-19 loan provision was approximately $71.7 million.   Our CECL provisioning model is significantly tied to projected unemployment rates.   As a result of COVID-19, the unemployment rate projections significantly increased from January 1 to the end of March 2020, which resulted in the $71.7 million provision related to COVID-19. 

Our net interest margin was 4.22% for the three-month period ended March 31, 2020 compared to 4.24% for the three-month period ended December 31, 2019. The yield on loans was 5.79% and 5.90% for the three months ended March 31, 2020 and December 31, 2019, respectively, as average loans increased from $10.87 billion to $11.01 billion. Additionally, the rate on interest bearing deposits decreased to 1.08% as of  March 31, 2020 from 1.21% as of December 31, 2019, with average balances of $8.99 billion and $8.82 billion, respectively.

From the fourth quarter of 2019 to the first quarter of 2020, we experienced a $672,000 decrease in investment premium amortization as a result of the change in prepayment speeds.  This decreased investment premium amortization positively impacted the net interest margin for the quarter ended March 31, 2020 by 2.0 basis points.

During the first quarter of 2020, event interest income was $558,000 compared to event interest income of $549,000 for the quarter ended December 31, 2019.

For the three months ended March 31, 2020 and December 31, 2019, we recognized $7.6 million and $9.1 million, respectively, in total net accretion for acquired loans and deposits. The $1.5 million reduction in accretion income decreased the net interest margin by 4.5 basis points for the first quarter of 2020.

Purchase accounting accretion on acquired loans was $7.6 million and $9.1 million and average purchase accounting loan discounts were $69.4 million and $91.9 million for the three-month periods ended March 31, 2020 and December 31, 2019, respectively. Net amortization of time deposit premiums was $30,000 per quarter and net average remaining CD premiums were $236,000 and $266,000 for the three-month periods ended March 31, 2020 and December 31, 2019, respectively.

Net interest income on a fully taxable equivalent basis decreased $153,000, or 0.11%, to $141.0 million for the three-month period ended March 31, 2020, from $141.1 million for the three-month period ended December 31, 2019. This decrease in net interest income for the three-month period ended March 31, 2020 was the result of a $3.1 million decrease in interest income, which was partially offset by a $2.9 million decrease in interest expense. The $3.1 million decrease in interest income was primarily the result of a $3.1 million decrease in loan interest income and a $126,000 net decrease in investment income partially offset by a $167,000 increase in income on deposits with other banks. The $2.9 million decrease in interest expense was primarily the result of a $2.6 million decrease in interest expense on deposits. This decrease was the result of a $1.6 million decrease in interest expense on savings and interest-bearing transaction accounts and a $1.0 million decrease in interest expense on time deposits. 

Non-performing loans to total loans was 0.53% as of March 31, 2020 compared to 0.50% as of December 31, 2019. Non-performing assets to total assets increased from 0.43% as of December 31, 2019 to 0.44% as of March 31, 2020. For the first quarter of 2020, net charge-offs were $3.5 million compared to net charge-offs of $2.2 million for the fourth quarter of 2019.

The Company reported $22.9 million of non-interest income for the first quarter of 2020, compared to $28.0 million for the fourth quarter of 2019. The most important components of the fourth quarter non-interest income were $7.8 million from dividends from FHLB, FRB, FNBB & other equity investments, $6.6 million from service charges on deposits accounts, $6.1 million from other service charges and fees, $3.2 million from other income and $2.6 million from mortgage lending income. Non-interest income for the first quarter of 2020 includes $7.0 million in dividends related to a special dividend from an equity investment and a $5.8 million adjustment for the decline in fair market value of a marketable securities.

Non-interest expense for the first quarter of 2020 was $78.2 million compared to $71.3 million for the fourth quarter of 2019. The most important components of the fourth quarter non-interest expense were $39.3 million from salaries and employee benefits, $25.7 million in other expense and $8.9 million in occupancy and equipment expenses. For the first quarter of 2020, our efficiency ratio was 46.82%. Non-interest expense for the first quarter of 2020 included $7.8 million in unfunded commitments expense due to the adoption of CECL, $1.1 million in other professional fees related to outsourced special projects, and $711,000 in merger and acquisition expense.  Non-interest expense for the fourth quarter of 2019 included $631,000 in other professional fees related to an outsourced special project.

Financial Condition

Total loans receivable were $11.38 billion at March 31, 2020 compared to $10.87 billion at December 31, 2019. Total deposits were $11.51 billion at March 31, 2020 compared to $11.28 billion at December 31, 2019. Total assets were $15.53 billion at March 31, 2020 compared to $15.03 billion at December 31, 2019.

During the first quarter 2020, the Company experienced approximately $109.0 million in organic loan growth. Centennial CFG experienced $167.9 million of organic loan growth and had loans of $1.76 billion at March 31, 2020. Our legacy footprint experienced $58.9 million in organic loan decline during the quarter.  

Non-performing loans at March 31, 2020 were $16.9 million, $39.5 million, $518,000, $3.0 million and zero in the Arkansas, Florida, Alabama, Shore Premier Finance and Centennial CFG markets, respectively, for a total of $59.9 million. Non-performing assets at March 31, 2020 were $20.6 million, $44.4 million, $552,000, $3.0 million and zero in the Arkansas, Florida, Alabama, Shore Premier Finance and Centennial CFG markets, respectively, for a total of $68.5 million. 

The Company’s allowance for credit losses was $228.9 million at March 31, 2020, or 2.01% of total loans, compared to the allowance for loan losses of $102.1 million, or 0.94% of total loans, at December 31, 2019. As of March 31, 2020, and December 31, 2019, the Company’s allowance for credit losses and allowance for loan losses was 369.7% and 186.2% of its total non-performing loans, respectively.  The increase in the allowance for credit losses at March 31, 2020, is primarily attributable to the Company’s adoption of CECL and the provision for credit losses recorded during the first quarter 2020 for the effects of COVID-19 and the loans acquired from LH-Finance.

Stockholders’ equity was $2.43 billion at March 31, 2020 compared to $2.51 billion at December 31, 2019, a decrease of approximately $81.3 million. The decrease in stockholders’ equity is primarily associated with the $65.1 million decrease in retained earnings and the repurchase of $23.9 million of our common stock during the first quarter of 2020 which were partially offset by the $4.8 million increase in accumulated other comprehensive income.  Book value per common share was $14.72 at March 31, 2020 compared to $15.10 at December 31, 2019.  Tangible book value per common share (non-GAAP) was $8.61 at March 31, 2020 compared to $9.12 at December 31, 2019, a decrease of 5.59%.(1) ____________________(1) Calculation of this metric and the reconciliation to GAAP are included in the schedules accompanying this release

Branches

The Company currently has 77 branches in Arkansas, 78 branches in Florida, 5 branches in Alabama and one branch in New York City.

Conference Call

Management will conduct a conference call to review this information at 1:00 p.m. CT (2:00 ET) on Thursday, April 16, 2020.  We encourage all participants to pre-register for the conference call using the following link:  http://dpregister.com/10140220.  Callers who pre-register will be given dial-in instructions and a unique PIN to gain immediate access to the live call.  Participants may pre-register now, or at any time prior to the call, and will immediately receive simple instructions via email.  The Home BancShares conference call will also be automatically scheduled as an event in your Outlook calendar.

Those without internet access or unable to pre-register may dial in and listen to the live call by calling 1-877-508-9586 and asking for the Home BancShares conference call.  A replay of the call will be available by calling 1-877-344-7529, Passcode: 10140220, which will be available until April 23, 2020 at 10:59 p.m. CT (11:59 p.m. ET).  Internet access to the call will be available live or in recorded version on the Company's website at www.homebancshares.com under “Investor Relations” for 12 months.

Non-GAAP Financial Measures

This press release contains financial information determined by methods other than in accordance with generally accepted accounting principles (GAAP). The Company’s management uses these non-GAAP financial measures--including net income (earnings), as adjusted; diluted earnings per common share, as adjusted; return on average assets, as adjusted; return on average common equity, as adjusted; return on average tangible common equity; return on average tangible common equity, as adjusted; efficiency ratio, as adjusted, tangible book value per common share and tangible common equity to tangible assets--to provide meaningful supplemental information regarding our performance.  These measures typically adjust GAAP performance measures to include the tax benefit associated with revenue items that are tax-exempt, as well as adjust income available to common shareholders for certain significant items or transactions that management believes are not indicative of the Company’s primary business operating results.  Since the presentation of these GAAP performance measures and their impact differ between companies, management believes presentations of these non-GAAP financial measures provide useful supplemental information that is essential to a proper understanding of the operating results of the Company’s business. These non-GAAP disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Where non-GAAP financial measures are used, the comparable GAAP financial measure, as well as the reconciliation to the comparable GAAP financial measure, can be found in the tables of this release.

General

This release may contain forward-looking statements regarding the Company’s plans, expectations, goals and outlook for the future. Statements in this press release that are not historical facts should be considered forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements of this type speak only as of the date of this news release. By nature, forward-looking statements involve inherent risk and uncertainties. Various factors could cause actual results to differ materially from those contemplated by the forward-looking statements.  These factors include, but are not limited to, the following:  economic conditions, credit quality, interest rates, loan demand, disruptions and uncertainties in our business and operations as a result of the ongoing coronavirus pandemic, the ability to successfully integrate new acquisitions, legislative and regulatory changes and risks associated with current and future regulations, technological changes and cybersecurity risks, competition from other financial institutions, changes in the assumptions used in making the forward-looking statements, and other factors described in reports we file with the Securities and Exchange Commission (the “SEC”), including those factors set forth in our Annual Report on Form 10-K for the year ended December 31, 2019 filed with the SEC on February 26, 2020.

Home BancShares, Inc. is a bank holding company, headquartered in Conway, Arkansas. Its wholly-owned subsidiary, Centennial Bank, provides a broad range of commercial and retail banking plus related financial services to businesses, real estate developers, investors, individuals and municipalities. Centennial Bank has branch locations in Arkansas, Florida, South Alabama and New York City. The Company’s common stock is traded through the NASDAQ Global Select Market under the symbol “HOMB.”

FOR MORE INFORMATION CONTACT: Donna Townsell Director of Investor Relations Home BancShares, Inc. (501) 328-4625

Home BancShares, Inc.
Consolidated End of Period Balance Sheets
(Unaudited)
		Mar. 31,			Dec. 31,			Sep. 30,			Jun. 30,			Mar. 31,
(In thousands)			2020			2019			2019			2019			2019
ASSETS
Cash and due from banks		$	147,200		$	168,914		$	171,492		$	183,745		$	141,027
Interest-bearing deposits with other banks			424,235			321,687			270,804			373,557			421,443
Cash and cash equivalents			571,435			490,601			442,296			557,302			562,470
Federal funds sold			-			-			1,650			1,075			1,700
Investment securities - available-for-sale, net of allowance for   credit losses			2,098,000			2,083,838			2,087,508			2,053,939			2,013,123
Loans receivable			11,384,982			10,869,710			10,771,946			11,053,129			10,978,935
Allowance for credit losses			(228,923	)		(102,122	)		(104,304	)		(106,066	)		(106,357	)
Loans receivable, net			11,156,059			10,767,588			10,667,642			10,947,063			10,872,578
Bank premises and equipment, net			281,795			280,103			277,966			278,821			279,012
Foreclosed assets held for sale			8,204			9,143			8,639			13,734			14,466
Cash value of life insurance			103,120			102,562			102,003			149,708			149,353
Accrued interest receivable			50,295			45,086			47,557			48,992			50,288
Deferred tax asset, net			77,110			44,301			53,436			58,517			64,061
Goodwill			973,025			958,408			958,408			958,408			958,408
Core deposit and other intangibles			35,055			36,572			38,136			39,723			41,310
Other assets			177,634			213,845			216,694			180,293			172,732
Total assets		$	15,531,732		$	15,032,047		$	14,901,935		$	15,287,575		$	15,179,501
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
Deposits:
Demand and non-interest-bearing		$	2,425,036		$	2,367,091		$	2,394,207		$	2,575,696		$	2,519,175
Savings and interest-bearing transaction accounts			7,149,644			6,933,964			6,620,616			6,774,162			6,650,181
Time deposits			1,940,234			1,977,328			2,032,547			1,997,458			1,898,096
Total deposits			11,514,914			11,278,383			11,047,370			11,347,316			11,067,452
Federal funds purchased			-			5,000			50,000			-			-
Securities sold under agreements to repurchase			126,884			143,727			157,038			142,541			152,239
FHLB and other borrowed funds			951,436			621,439			691,443			899,447			1,105,175
Accrued interest payable and other liabilities			138,479			102,410			117,332			107,695			124,172
Subordinated debentures			369,748			369,557			369,363			369,170			368,979
Total liabilities			13,101,461			12,520,516			12,432,546			12,866,169			12,818,017
Stockholders' equity
Common stock			1,651			1,664			1,669			1,675			1,682
Capital surplus			1,516,151			1,537,091			1,542,858			1,550,999			1,560,994
Retained earnings			891,498			956,555			904,980			853,964			803,629
Accumulated other comprehensive (loss) income			20,971			16,221			19,882			14,768			(4,821	)
Total stockholders' equity			2,430,271			2,511,531			2,469,389			2,421,406			2,361,484
Total liabilities and stockholders' equity		$	15,531,732		$	15,032,047		$	14,901,935		$	15,287,575		$	15,179,501

Home BancShares, Inc.
Consolidated Statements of Income
(Unaudited)
	Quarter Ended															Three Months Ended
	Mar. 31,			Dec. 31,			Sep. 30,			Jun. 30,			Mar. 31,			Mar. 31,			Mar. 31,
(In thousands)		2020			2019			2019			2019			2019			2020			2019
Interest income
Loans	$	158,148		$	161,211		$	167,470		$	165,816		$	163,848		$	158,148		$	163,848
Investment securities
Taxable		9,776			9,707			10,343			10,650			10,706			9,776			10,706
Tax-exempt		3,114			3,260			3,193			3,183			3,379			3,114			3,379
Deposits - other banks		1,116			949			1,068			1,628			1,543			1,116			1,543
Federal funds sold		21			5			8			10			11			21			11
Total interest income		172,175			175,132			182,082			181,287			179,487			172,175			179,487
Interest expense
Interest on deposits		24,198			26,823			29,566			29,709			28,006			24,198			28,006
Federal funds purchased		13			33			21			-			-			13			-
FHLB borrowed funds		2,698			2,686			3,683			4,722			6,118			2,698			6,118
Securities sold under agreements to repurchase		462			652			628			630			634			462			634
Subordinated debentures		5,079			5,155			5,207			5,239			5,259			5,079			5,259
Total interest expense		32,450			35,349			39,105			40,300			40,017			32,450			40,017
Net interest income		139,725			139,783			142,977			140,987			139,470			139,725			139,470
Provision for credit loss - loans		76,672			-			-			1,325			-			76,672			-
Provision for credit loss - acquired loans		9,309			-			-			-			-			9,309			-
Provision for credit loss - investment securities		842			-			-			-			-			842			-
Total credit loss expense		86,823			-			-			1,325			-			86,823			-
Net interest income after
provision for credit losses		52,902			139,783			142,977			139,662			139,470			52,902			139,470
Non-interest income
Service charges on deposit accounts		6,631			6,778			6,492			6,259			6,401			6,631			6,401
Other service charges and fees		6,056			10,636			8,710			8,177			6,563			6,056			6,563
Trust fees		438			390			382			391			403			438			403
Mortgage lending income		2,621			3,801			4,610			3,457			2,435			2,621			2,435
Insurance commissions		678			551			603			515			609			678			609
Increase in cash value of life insurance		560			562			714			740			736			560			736
Dividends from FHLB, FRB, FNBB & other		7,842			1,952			1,101			1,149			3,505			7,842			3,505
Gain (loss) on SBA loans		341			686			291			355			241			341			241
Gain (loss) on branches, equipment and   other assets, net		82			35			12			(129	)		79			82			79
Gain (loss) on OREO, net		277			159			334			58			206			277			206
Gain (loss) on securities, net		-			(2	)		-			-			-			-			-
Fair value adjustment for marketable securities		(5,818	)		-			-			-			-			(5,818	)		-
Other income		3,219			2,481			1,500			2,094			2,494			3,219			2,494
Total non-interest income		22,927			28,029			24,749			23,066			23,672			22,927			23,672
Non-interest expense
Salaries and employee benefits		39,329			38,446			39,919			37,976			37,836			39,329			37,836
Occupancy and equipment		8,873			8,729			9,047			8,853			8,823			8,873			8,823
Data processing expense		4,326			4,294			4,059			3,838			3,970			4,326			3,970
Other operating expenses		25,721			19,873			14,739			16,957			18,428			25,721			18,428
Total non-interest expense		78,249			71,342			67,764			67,624			69,057			78,249			69,057
(Loss) income before income taxes		(2,420	)		96,470			99,962			95,104			94,085			(2,420	)		94,085
Income tax (benefit) expense		(2,927	)		23,208			27,199			22,940			22,735			(2,927	)		22,735
Net income	$	507		$	73,262		$	72,763		$	72,164		$	71,350		$	507		$	71,350

Home BancShares, Inc.
Selected Financial Information
(Unaudited)
	Quarter Ended																Three Months Ended
	Mar. 31,			Dec. 31,			Sep. 30,			Jun. 30,			Mar. 31,				Mar. 31,			Mar. 31,
(Dollars and shares in thousands, except per share data)		2020			2019			2019			2019			2019				2020			2019
PER SHARE DATA
Diluted earnings per common share	$	-		$	0.44		$	0.44		$	0.43		$	0.42			$	-		$	0.42
Diluted earnings per common share, as adjusted, excluding   outsourced special project expense, merger and acquisition   expense, fair value adjustment for marketable securities,   unfunded commitment expense, provision for credit losses,   special dividend from equity investment, FDIC Small Bank   Assessment Credit, hurricane expense, Florida tax savings   and BOLI redemption tax (non-GAAP)(1)		0.43			0.44			0.44			0.44			0.42				0.43			0.42
Basic earnings per common share		-			0.44			0.44			0.43			0.42				-			0.42
Dividends per share - common		0.1300			0.1300			0.1300			0.1300			0.1200				0.1300			0.1200
Book value per common share		14.72			15.10			14.80			14.46			14.04				14.72			14.04
Tangible book value per common share (non-GAAP)(1)		8.61			9.12			8.83			8.50			8.10				8.61			8.10
STOCK INFORMATION
Average common shares outstanding		166,014			166,696			167,178			167,791			169,592				166,014			169,592
Average diluted shares outstanding		166,014			166,696			167,178			167,791			169,592				166,014			169,592
End of period common shares outstanding		165,148			166,373			166,860			167,466			168,173				165,148			168,173
ANNUALIZED PERFORMANCE METRICS
Return on average assets		0.01%			1.94%			1.93%			1.92%			1.92%				0.01%			1.92%
Return on average assets excluding outsourced special   project expense, merger and acquisition expense, fair value    adjustment for marketable securities, unfunded commitment   expense, provision for credit losses, special dividend from   equity investment, FDIC Small Bank Assessment Credit,   hurricane expense, Florida tax savings and BOLI redemption   tax: (ROA, as adjusted) (non-GAAP)(1)		1.88%			1.94%			1.96%			1.95%			1.92%				1.88%			1.92%
Return on average assets excluding intangible   amortization (non-GAAP)(1)		0.05%			2.12%			2.10%			2.09%			2.09%				0.05%			2.09%
Return on average common equity		0.08%			11.71%			11.84%			12.18%			12.34%				0.08%			12.34%
Return on average common equity excluding outsourced special   project expense, merger and acquisition expense, fair value    adjustment for marketable securities, unfunded commitment   expense, provision for credit losses, special dividend from   equity investment, FDIC Small Bank Assessment Credit,    hurricane expense, Florida tax savings and BOLI redemption   tax: (ROE, as adjusted) (non-GAAP)(1)		11.48%			11.68%			12.08%			12.39%			12.34%				11.48%			12.34%
Return on average tangible common equity (non-GAAP)(1)		0.14%			19.55%			20.04%			21.01%			21.53%				0.14%			21.53%
Return on average tangible common equity excluding intangible   amortization (non-GAAP)(1)		0.44%			19.86%			20.36%			21.35%			21.88%				0.44%			21.88%
Return on average tangible common equity excluding outsourced   special project expense, merger and acquisition expense, fair   value adjustment for marketable securities, unfunded   commitment expense, provision for credit losses, special   dividend from equity investment, FDIC Small Bank Assessment   Credit, hurricane expense, Florida tax savings and BOLI   redemption tax: (ROTCE, as adjusted) (non-GAAP)(1)		19.22%			19.51%			20.45%			21.37%			21.53%				19.22%			21.53%
Efficiency ratio		46.82%			41.26%			39.16%			39.93%			41.01%				46.82%			41.01%
Efficiency ratio, as adjusted (non-GAAP)(1)		41.37%			41.14%			40.60%			39.92%			40.52%				41.37%			40.52%
Net interest margin - FTE		4.22%			4.24%			4.32%			4.28%			4.30%				4.22%			4.30%
Fully taxable equivalent adjustment	$	1,227		$	1,322		$	1,247		$	1,319		$	1,367			$	1,227		$	1,367
Total revenue (net)		162,652			167,812			167,726			164,053			163,142				162,652			163,142
Total purchase accounting accretion		7,647			9,133			8,462			9,240			9,055				7,647			9,055
Average purchase accounting loan discounts		69,365			91,869			112,623			122,197			131,596				69,365			131,596
OTHER OPERATING EXPENSES
Advertising	$	1,226		$	1,340		$	1,201		$	1,095		$	1,051			$	1,226		$	1,051
Merger and acquisition expenses		711			-			-			-			-				711			-
Amortization of intangibles		1,517			1,565			1,587			1,587			1,586				1,517			1,586
Electronic banking expense		1,715			1,870			1,901			1,851			1,903				1,715			1,903
Directors' fees		424			396			380			392			434				424			434
Due from bank service charges		223			289			272			282			238				223			238
FDIC and state assessment		1,548			1,635			(532	)		1,655			1,710				1,548			1,710
Hurricane expense		-			-			-			-			897				-			897
Insurance		746			790			698			661			697				746			697
Legal and accounting		919			1,633			1,414			989			981				919			981
Other professional fees		3,226			3,189			1,906			2,306			2,812				3,226			2,812
Operating supplies		535			469			511			505			536				535			536
Postage		327			327			320			293			326				327			326
Telephone		324			312			289			306			303				324			303
Unfunded commitments		7,775			-			-			-			-				7,775			-
Other expense		4,505			6,058			4,792			5,035			4,954				4,505			4,954
Total other operating expenses	$	25,721		$	19,873		$	14,739		$	16,957		$	18,428			$	25,721		$	18,428
(1)  Calculation of this metric and the reconciliation to GAAP are included in the schedules accompanying this release.

Home BancShares, Inc.
Selected Financial Information
(Unaudited)
	Mar. 31,			Dec. 31,			Sep. 30,			Jun. 30,			Mar. 31,
(Dollars in thousands)		2020			2019			2019			2019			2019
BALANCE SHEET RATIOS
Total loans to total deposits		98.87%			96.38%			97.51%			97.41%			99.20%
Common equity to assets		15.65%			16.71%			16.57%			15.84%			15.56%
Tangible common equity to tangible assets (non-GAAP)(1)		9.79%			10.80%			10.59%			9.96%			9.60%
LOANS RECEIVABLE
Real estate
Commercial real estate loans
Non-farm/non-residential	$	4,357,007		$	4,412,769		$	4,375,970		$	4,495,558		$	4,623,174
Construction/land development		1,892,394			1,776,689			1,827,454			1,930,838			1,649,303
Agricultural		89,630			88,400			87,087			85,045			76,092
Residential real estate loans
Residential 1-4 family		1,775,610			1,819,221			1,808,099			1,852,784			1,947,119
Multifamily residential		411,960			488,278			498,079			523,789			538,098
Total real estate		8,526,601			8,585,357			8,596,689			8,888,014			8,833,786
Consumer		852,174			511,909			469,741			455,554			448,093
Commercial and industrial		1,759,752			1,528,003			1,479,724			1,515,357			1,505,773
Agricultural		64,582			63,644			90,343			80,621			58,966
Other		181,873			180,797			135,449			113,583			132,317
Loans receivable	$	11,384,982		$	10,869,710		$	10,771,946		$	11,053,129		$	10,978,935
Discount for credit losses on purchased loans	$	58,894		$	58,719		$	89,615		$	98,672		$	106,617
ALLOWANCE FOR CREDIT LOSSES
Balance, beginning of period	$	102,122		$	104,304		$	106,066		$	106,357		$	108,791
Impact of adopting ASC 326		43,988			-			-			-			-
Allowance for credit losses on acquired loans		357			-			-			-			-
Loans charged off		4,265			2,631			2,302			2,279			3,391
Recoveries of loans previously charged off		740			449			540			663			957
Net loans (recovered)/charged off		3,525			2,182			1,762			1,616			2,434
Provision for credit loss - loans		76,672			-			-			1,325			-
Provision for credit loss - acquired loans		9,309			-			-			-			-
Total credit loss expense excluding provision for credit   loss - investment securities		85,981			-			-			1,325			-
Balance, end of period	$	228,923		$	102,122		$	104,304		$	106,066		$	106,357
Net (recoveries) charge-offs to average total loans		0.13%			0.08%			0.06%			0.06%			0.09%
Allowance for credit losses to total loans		2.01%			0.94%			0.97%			0.96%			0.97%
NON-PERFORMING ASSETS
Non-performing loans
Non-accrual loans	$	52,131		$	47,607		$	48,640		$	52,841		$	49,616
Loans past due 90 days or more		7,760			7,238			9,964			9,961			14,577
Total non-performing loans		59,891			54,845			58,604			62,802			64,193
Other non-performing assets
Foreclosed assets held for sale, net		8,204			9,143			8,639			13,734			14,466
Other non-performing assets		447			447			447			947			947
Total other non-performing assets		8,651			9,590			9,086			14,681			15,413
Total non-performing assets	$	68,542		$	64,435		$	67,690		$	77,483		$	79,606
Allowance for credit losses for loans to non-performing loans		382.23%			186.20%			177.98%			168.89%			165.68%
Non-performing loans to total loans		0.53%			0.50%			0.54%			0.57%			0.58%
Non-performing assets to total assets		0.44%			0.43%			0.45%			0.51%			0.52%
(1)  Calculation of this metric and the reconciliation to GAAP is included in the schedules accompanying this release.

Home BancShares, Inc.
Consolidated Net Interest Margin
(Unaudited)
	Three Months Ended
	March 31, 2020									December 31, 2019
	Average			Income/			Yield/			Average			Income/			Yield/
(Dollars in thousands)	Balance			Expense			Rate			Balance			Expense			Rate
ASSETS
Earning assets
Interest-bearing balances due from banks	$	331,038		$	1,116		1.36	%		$	234,159		$	949		1.61	%
Federal funds sold		5,218			21		1.62	%			1,158			5		1.71	%
Investment securities - taxable		1,710,288			9,776		2.30	%			1,710,192			9,707		2.25	%
Investment securities - non-taxable - FTE		374,198			4,090		4.40	%			376,613			4,285		4.51	%
Loans receivable - FTE		11,007,958			158,399		5.79	%			10,866,386			161,508		5.90	%
Total interest-earning assets		13,428,700			173,402		5.19	%			13,188,508			176,454		5.31	%
Non-earning assets		1,704,775									1,755,860
Total assets	$	15,133,475								$	14,944,368
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities
Interest-bearing liabilities
Savings and interest-bearing transaction accounts	$	7,041,303		$	15,803		0.90	%		$	6,792,252		$	17,406		1.02	%
Time deposits		1,943,721			8,395		1.74	%			2,025,032			9,417		1.84	%
Total interest-bearing deposits		8,985,024			24,198		1.08	%			8,817,284			26,823		1.21	%
Federal funds purchased		6,264			13		0.83	%			6,684			33		1.96	%
Securities sold under agreement to repurchase		138,180			462		1.34	%			159,719			652		1.62	%
FHLB borrowed funds		623,525			2,698		1.74	%			562,963			2,686		1.89	%
Subordinated debentures		369,652			5,079		5.53	%			369,462			5,155		5.54	%
Total interest-bearing liabilities		10,122,645			32,450		1.29	%			9,916,112			35,349		1.41	%
Non-interest bearing liabilities
Non-interest bearing deposits		2,410,583									2,433,384
Other liabilities		119,143									112,466
Total liabilities		12,652,371									12,461,962
Shareholders' equity		2,481,104									2,482,406
Total liabilities and shareholders' equity	$	15,133,475								$	14,944,368
Net interest spread							3.90	%								3.90	%
Net interest income and margin - FTE				$	140,952		4.22	%					$	141,105		4.24	%

Home BancShares, Inc.
Consolidated Net Interest Margin
(Unaudited)
	Three Months Ended
	March 31, 2020									March 31, 2019
	Average			Income/			Yield/			Average			Income/			Yield/
(Dollars in thousands)	Balance			Expense			Rate			Balance			Expense			Rate
ASSETS
Earning assets
Interest-bearing balances due from banks	$	331,038		$	1,116		1.36	%		$	272,410		$	1,543		2.30	%
Federal funds sold		5,218			21		1.62	%			1,491			11		2.99	%
Investment securities - taxable		1,710,288			9,776		2.30	%			1,595,605			10,706		2.72	%
Investment securities - non-taxable - FTE		374,198			4,090		4.40	%			390,754			4,424		4.59	%
Loans receivable - FTE		11,007,958			158,399		5.79	%			11,036,503			164,170		6.03	%
Total interest-earning assets		13,428,700			173,402		5.19	%			13,296,763			180,854		5.52	%
Non-earning assets		1,704,775									1,782,909
Total assets	$	15,133,475								$	15,079,672
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities
Interest-bearing liabilities
Savings and interest-bearing transaction accounts	$	7,041,303		$	15,803		0.90	%		$	6,596,895		$	19,537		1.20	%
Time deposits		1,943,721			8,395		1.74	%			1,903,373			8,469		1.80	%
Total interest-bearing deposits		8,985,024			24,198		1.08	%			8,500,268			28,006		1.34	%
Federal funds purchased		6,264			13		0.83	%			-			-		0.00	%
Securities sold under agreement to repurchase		138,180			462		1.34	%			150,803			634		1.71	%
FHLB borrowed funds		623,525			2,698		1.74	%			1,159,629			6,118		2.14	%
Subordinated debentures		369,652			5,079		5.53	%			368,884			5,259		5.78	%
Total interest-bearing liabilities		10,122,645			32,450		1.29	%			10,179,584			40,017		1.59	%
Non-interest bearing liabilities
Non-interest bearing deposits		2,410,583									2,439,520
Other liabilities		119,143									115,911
Total liabilities		12,652,371									12,735,015
Shareholders' equity		2,481,104									2,344,657
Total liabilities and shareholders' equity	$	15,133,475								$	15,079,672
Net interest spread							3.90	%								3.93	%
Net interest income and margin - FTE				$	140,952		4.22	%					$	140,837		4.30	%

Home BancShares, Inc.
Non-GAAP Reconciliations
(Unaudited)
	Quarter Ended																Three Months Ended
(Dollars and shares in thousands,	Mar. 31,			Dec. 31,			Sep. 30,			Jun. 30,			Mar. 31,				Mar. 31,			Mar. 31,
except per share data)		2020			2019			2019			2019			2019				2020			2019
EARNINGS, AS ADJUSTED
GAAP net income available to common shareholders (A)	$	507		$	73,262		$	72,763		$	72,164		$	71,350			$	507		$	71,350
Pre-tax adjustments
Outsourced special project expense		1,092			631			-			-			900				1,092			900
Merger and acquisition expenses		711			-			-			-			-				711			-
Fair value adjustment for marketable securities		5,818			-			-			-			-				5,818			-
Unfunded commitment expense		7,775			-			-			-			-				7,775			-
Provision for credit losses		86,823			-			-			1,325			-				86,823			-
Special dividend from equity investment		(7,004	)		(861	)		-			-			(2,134	)			(7,004	)		(2,134	)
FDIC Small Bank Assessment Credit		-			-			(2,291	)		-			-				-			-
Hurricane expenses		-			-			-			-			897				-			897
Total pre-tax adjustments		95,215			(230	)		(2,291	)		1,325			(337	)			95,215			(337	)
Tax-effect of adjustments		24,884			(59	)		(592	)		342			(87	)			24,884			(87	)
Adjustments after-tax		70,331			(171	)		(1,699	)		983			(250	)			70,331			(250	)
Florida tax savings		-			-			(497	)		252			245				-			245
BOLI redemption tax		-			-			3,667			-			-				-			-
Total adjustments after-tax (B)		70,331			(171	)		1,471			1,235			(5	)			70,331			(5	)
Earnings, as adjusted (C)	$	70,838		$	73,091		$	74,234		$	73,399		$	71,345			$	70,838		$	71,345
Average diluted shares outstanding (D)		166,014			166,696			167,178			167,791			169,592				166,014			169,592
GAAP diluted earnings per share: (A/D)	$	-		$	0.44		$	0.44		$	0.43		$	0.42			$	-		$	0.42
Adjustments after-tax: (B/D)		0.43			-			-			0.01			-				0.43			-
Diluted earnings per common share, as adjusted, excluding    outsourced special project expense, merger and acquisition   expense, fair value adjustment for marketable securities,   unfunded commitment expense, provision for credit losses,   special dividend from equity investment, FDIC Small Bank   Assessment Credit, hurricane expense, Florida tax savings   and BOLI redemption tax: (C/D)	$	0.43		$	0.44		$	0.44		$	0.44		$	0.42			$	0.43		$	0.42
ANNUALIZED RETURN ON AVERAGE ASSETS
Return on average assets: (A/E)		0.01%			1.94%			1.93%			1.92%			1.92%				0.01%			1.92%
Return on average assets excluding excluding    outsourced special project expense, merger and acquisition   expense, fair value adjustment for marketable securities,   unfunded commitment expense, provision for credit losses,   special dividend from equity investment, FDIC Small Bank   Assessment Credit, hurricane expense, Florida tax savings   and BOLI redemption tax: (ROA, as adjusted) ((A+D)/E)		1.88%			1.94%			1.96%			1.95%			1.92%				1.88%			1.92%
Return on average assets excluding intangible   amortization: ((A+C)/(E-F))		0.05%			2.12%			2.10%			2.09%			2.09%				0.05%			2.09%
GAAP net income available to common shareholders (A)	$	507		$	73,262		$	72,763		$	72,164		$	71,350			$	507		$	71,350
Amortization of intangibles (B)		1,517			1,565			1,587			1,587			1,586				1,517			1,586
Amortization of intangibles after-tax (C)		1,121			1,161			1,177			1,177			1,177				1,121			1,177
Adjustments after-tax (D)		70,331			(171	)		1,471			1,235			(5	)			70,331			(5	)
Average assets (E)		15,133,475			14,944,368			14,993,232			15,098,600			15,079,672				15,133,475			15,079,672
Average goodwill, core deposits & other intangible assets (F)		999,004			995,721			997,309			998,898			1,000,494				999,004			1,000,494

Home BancShares, Inc.
Non-GAAP Reconciliations
(Unaudited)
	Quarter Ended																Three Months Ended
(Dollars and shares in thousands,	Mar. 31,			Dec. 31			Sep. 30,			Jun. 30,			Mar. 31,				Mar. 31,			Mar. 31,
except per share data)		2020			2020			2019			2019			2019				2020			2019
ANNUALIZED RETURN ON AVERAGE COMMON EQUITY
Return on average common equity: (A/D)		0.08%			11.71%			11.84%			12.18%			12.34%				0.08%			12.34%
Return on average common equity excluding  outsourced   special project expense, merger and acquisition   expense, fair value adjustment for marketable securities,   unfunded commitment expense, provision for credit losses,   special dividend from equity investment, FDIC Small Bank   Assessment Credit, hurricane expense, Florida tax savings   and BOLI redemption tax: (ROE, as adjusted) ((A+C)/D)		11.48%			11.68%			12.08%			12.39%			12.34%				11.48%			12.34%
Return on average tangible common equity: (A/(D-E))		0.14%			19.55%			20.04%			21.01%			21.53%				0.14%			21.53%
Return on average tangible common equity excluding intangible   amortization: (B/(D-E))		0.44%			19.86%			20.36%			21.35%			21.88%				0.44%			21.88%
Return on average tangible common equity excluding    outsourced special project expense, merger and acquisition   expense, fair value adjustment for marketable securities,   unfunded commitment expense, provision for credit losses,   special dividend from equity investment, FDIC Small Bank   Assessment Credit, hurricane expense, Florida tax savings   and BOLI redemption tax: (ROTCE, as adjusted) ((A+C)/(D-E))		19.22%			19.51%			20.45%			21.37%			21.53%				19.22%			21.53%
GAAP net income available to common shareholders (A)	$	507		$	73,262		$	72,763		$	72,164		$	71,350			$	507		$	71,350
Earnings excluding intangible amortization (B)		1,628			74,423			73,940			73,341			72,527				1,628			72,527
Adjustments after-tax (C)		70,331			(171	)		1,471			1,235			(5	)			70,331			(5	)
Average common equity (D)		2,481,104			2,482,406			2,437,820			2,376,718			2,344,657				2,481,104			2,344,657
Average goodwill, core deposits & other intangible assets (E)		999,004			995,721			997,309			998,898			1,000,494				999,004			1,000,494
EFFICIENCY RATIO
Efficiency ratio:  ((C-E)/(A+B+D))		46.82%			41.26%			39.16%			39.93%			41.01%				46.82%			41.01%
Efficiency ratio, as adjusted:  ((C-E-G)/(A+B+D-F))		41.37%			41.14%			40.60%			39.92%			40.52%				41.37%			40.52%
Net interest income (A)	$	139,725		$	139,783		$	142,977		$	140,987		$	139,470			$	139,725		$	139,470
Non-interest income (B)		22,927			28,029			24,749			23,066			23,672				22,927			23,672
Non-interest expense (C)		78,249			71,342			67,764			67,624			69,057				78,249			69,057
Fully taxable equivalent adjustment (D)		1,227			1,322			1,247			1,319			1,367				1,227			1,367
Amortization of intangibles (E)		1,517			1,565			1,587			1,587			1,586				1,517			1,586
Adjustments:
Non-interest income:
Special dividend from equity investment	$	7,004		$	861		$	-		$	-		$	2,134			$	7,004		$	2,134
Fair value adjustment for marketable securities		(5,818	)		-			-			-			-				(5,818	)		-
Gain (loss) on OREO		277			159			334			58			206				277			206
Gain (loss) on branches, equipment and other assets, net		82			35			12			(129	)		79				82			79
Gain (loss) on securities		-			(2	)		-			-			-				-			-
Total non-interest income adjustments (F)	$	1,545		$	1,053		$	346		$	(71	)	$	2,419			$	1,545		$	2,419
Non-interest expense:
FDIC Small Bank Assessment Credit	$	-		$	-		$	(2,291	)	$	-		$	-			$	-		$	-
Merger Expenses		711			-			-			-			-				711			-
Hurricane damage expense		-			-			-			-			897				-			897
Outsourced special project expense		1,092			631			-			-			900				1,092			900
Unfunded commitment expense		7,775			-			-			-			-				7,775			-
Total non-interest expense adjustments (G)	$	9,578		$	631		$	(2,291	)	$	-		$	1,797			$	9,578		$	1,797

Home BancShares, Inc.
Non-GAAP Reconciliations
(Unaudited)
	Mar. 31,			Dec. 31,			Sep. 30,			Jun. 30,			Mar. 31,
(Dollars in thousands)		2020			2019			2019			2019			2019
TANGIBLE BOOK VALUE PER COMMON SHARE
Book value per common share: (A/B)	$	14.72		$	15.10		$	14.80		$	14.46		$	14.04
Tangible book value per common share: ((A-C-D)/B)		8.61			9.12			8.83			8.50			8.10
Total stockholders' equity (A)	$	2,430,271		$	2,511,531		$	2,469,389		$	2,421,406		$	2,361,484
End of period common shares outstanding (B)		165,148			166,373			166,860			167,466			168,173
Goodwill (C)		973,025			958,408			958,408			958,408			958,408
Core deposit and other intangibles (D)		35,055			36,572			38,136			39,723			41,310
TANGIBLE COMMON EQUITY TO TANGIBLE ASSETS
Equity to assets: (B/A)		15.65%			16.71%			16.57%			15.84%			15.56%
Tangible common equity to tangible assets: ((B-C-D)/(A-C-D))		9.79%			10.80%			10.59%			9.96%			9.60%
Total assets (A)	$	15,531,732		$	15,032,047		$	14,901,935		$	15,287,575		$	15,179,501
Total stockholders' equity (B)		2,430,271			2,511,531			2,469,389			2,421,406			2,361,484
Goodwill (C)		973,025			958,408			958,408			958,408			958,408
Core deposit and other intangibles (D)		35,055			36,572			38,136			39,723			41,310