HOMB Home BancShares Inc

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

Highlights of the Second Quarter of 2021:

Metric	Q2 2021	Q1 2021	Q4 2020	Q3 2020	Q2 2020
Net Income	$79.1 million	$91.6 million	$81.8 million	$69.3 million	$62.8 million
Total Revenue (net)	$172.4 million	$193.4 million	$181.9 million	$176.1 million	$173.7 million
Income (loss) before income taxes	$104.1 million	$120.5 million	$107.7 million	$90.4 million	$82.1 million
Pre-tax, pre-provision, net income (PPNR) (non-GAAP)(1)	$99.4 million	$120.5 million	$107.7 million	$104.4 million	$102.7 million
Pre-tax net income to total revenue (net)	60.42%	62.32%	59.19%	51.32%	47.25%
P5NR (Pre-tax, pre-provision, profit percentage) (PPNR to total revenue (net)) (non-GAAP)(1)	57.66%	62.32%	59.19%	59.28%	59.15%
ROA	1.81%	2.22%	1.97%	1.66%	1.55%
NIM	3.61%	4.02%	4.00%	3.92%	4.11%
NIM, excluding PPP loans (non-GAAP)(1)	3.54%	3.87%	3.97%	3.98%	4.16%
Purchase Accounting Accretion	$5.8 million	$5.5 million	$5.7 million	$7.0 million	$7.0 million
ROE	11.92%	14.15%	12.72%	10.97%	10.27%
ROTCE (non-GAAP)(1)	19.12%	22.90%	20.96%	18.29%	17.40%
Diluted Earnings Per Share	$0.48	$0.55	$0.50	$0.42	$0.38
Non-Performing Assets to Total Assets	0.35%	0.38%	0.48%	0.47%	0.39%
Common Equity Tier 1 Capital	15.0%	14.3%	13.4%	12.6%	12.0%
Leverage	10.9%	11.1%	10.8%	10.4%	10.3%
Tier 1 Capital	15.6%	14.9%	14.0%	13.2%	12.6%
Total Risk-Based Capital	19.5%	18.8%	17.8%	16.9%	16.2%
Allowance for Credit Losses to Total Loans	2.36%	2.25%	2.19%	2.12%	1.99%
Allowance for Credit Losses to Total Loans, excluding PPP loans (non-GAAP)(1)	2.47%	2.40%	2.33%	2.28%	2.14%

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

“An annualized look at gross revenue and pre-tax, pre-provision, net income (PPNR) shows us on a steady track for the last four years,” said John Allison, Chairman. “Net income for the six-month period ended June 30, 2021 was $170.7 million, or $1.03 earnings per share, which is a record for the Company,” Allison stated. “The continued stable performance our team delivers each quarter brings both a sense of pride and comfort during these unstable economic times,” Allison continued.

“Jamie Dimon recently stated that JP Morgan Chase is effectively ‘stockpiling cash’ with plans to be patient because he believes in being prepared for higher rates and more inflation,” quoted Tracy French, Centennial Bank President and Chief Executive Officer. “One of the hardest things we do is maintain our discipline, and although loan growth might seem a little slow, we too plan to be patient as we do not intend to sell the future of our Company. We won’t be one to reach out in the market for short term gain to create long term pain,” French added.

Operating Highlights

Net income for the three-month period ended June 30, 2021 was $79.1 million, or $0.48 earnings per share. Net income for the six-month period ended June 30, 2021 was $170.7 million, or $1.03 earnings per share, which is a record for the Company.

During the second quarter of 2021, the Company recorded a negative provision for unfunded commitments of $4.8 million, or $0.02 per share. This was  primarily due to a single commercial & industrial loan for which a reserve was no longer considered necessary due to the borrower’s current cash flow position. The Company determined that an additional provision for credit losses on loans was not necessary as the current level of the allowance for credit losses was considered adequate as of June 30, 2021.

Our net interest margin was 3.61% for the three-month period ended June 30, 2021 compared to 4.02% for the three-month period ended March 31, 2021. The yield on loans was 5.40% and 5.56% for the three months ended June 30, 2021 and March 31, 2021, respectively, as average loans decreased from $11.02 billion to $10.54 billion. Additionally, the rate on interest bearing deposits decreased to 0.26% as of June 30, 2021 from 0.33% as of March 31, 2021, with average balances of $9.81 billion and $9.55 billion, respectively.

As of June 30, 2021, we had $473.9 million of Paycheck Protection Program (PPP) loans outstanding. These loans are at 1.00% plus the accretion of the origination fee. Excluding PPP loans, our net interest margin (non-GAAP) for the three-month period ended June 30, 2021 was 3.54%.(1) The PPP loans were accretive to the net interest margin by 7 basis points for the three-month period ended June 30, 2021 compared to 15 basis points for the three-month period ended March 31, 2021. This was primarily due to approximately $243.2 million of the Company’s PPP loans being forgiven during the second quarter of 2021 as well as the acceleration of deferred fees for the loans that were forgiven. The $243.2 million of PPP loans forgiven during the second quarter of 2021 were partially offset by $70.7 million in new PPP loan originations and funding during the second quarter of 2021. The deferred fee income decreased from $10.4 million to $6.3 million for the three-month periods ended March 31, 2021 and June 30, 2021, respectively.

The effects of the COVID-19 pandemic continued to create a significant amount of excess liquidity in the market. As a result of this excess liquidity, we had an increase of $966.6 million of average interest-bearing cash balances in the second quarter of 2021 compared to the first quarter of 2021. This excess liquidity diluted the net interest margin by 23 basis points for the three-month period ended June 30, 2021.

Purchase accounting accretion on acquired loans was $5.8 million and $5.5 million and average purchase accounting loan discounts were $38.6 million and $43.9 million for the three-month periods ended June 30, 2021 and March 31, 2021, respectively. Net amortization of time deposit premiums was $30,000 per quarter and net average remaining time deposit premiums were $85,000 and $115,000 for the three-month periods ended June 30, 2021 and March 31, 2021, respectively.

Net interest income on a fully taxable equivalent basis was $143.1 million for the three-month period ended June 30, 2021 and $149.9 million for the three-month period ended March 31, 2021. This decrease in net interest income for the three-month period ended June 30, 2021 was the result of an $8.2 million decrease in interest income, which was partially offset by a $1.3 million decrease in interest expense. The $8.2 million decrease in interest income was primarily the result of a $9.2 million decrease in loan interest income, which was partially offset by a $727,000 net increase in investment income and a $297,000 increase in interest-bearing balances due from banks. The $1.3 million decrease in interest expense was primarily the result of a decrease in interest expense on deposits.

The Company reported $31.1 million of non-interest income for the second quarter of 2021. The most important components of the second quarter non-interest income were $9.7 million from other service charges and fees, $6.2 million from mortgage lending income, $5.1 million from service charges on deposit accounts, $3.0 million from other income, $2.6 million from dividends from FHLB, FRB, FNBB and other, and a $1.3 million adjustment for the increase in fair market value of marketable securities. Included in the $2.6 million in dividends from FHLB, FRB, FNBB and other were $2.2 million in special dividends from equity investments. The Company is still currently involved in these investments; however, past performance does not guarantee future performance.

Non-interest expense for the second quarter of 2021 was $73.0 million. The most important components of the second quarter non-interest expense were $42.5 million from salaries and employee benefits, $15.6 million in other expense and $9.0 million in occupancy and equipment expenses. For the second quarter of 2021, our efficiency ratio was 41.08%.

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

Financial Condition

Total loans receivable were $10.20 billion at June 30, 2021 compared to $10.78 billion at March 31, 2021. Total deposits were $13.89 billion at June 30, 2021 compared to $13.51 billion at March 31, 2021. Total assets were $17.63 billion at June 30, 2021 compared to $17.24 billion at March 31, 2021.

During the second quarter 2021, the Company experienced approximately $579.3 million in loan decline. Centennial CFG experienced $41.1 million of organic loan growth and had loans of $1.56 billion at June 30, 2021. Our legacy footprint experienced $447.9 million in organic loan decline and $172.5 million in PPP loan decline during the quarter.

Non-performing loans to total loans was 0.58% as of June 30, 2021 compared to 0.59% as of March 31, 2021. Non-performing assets to total assets decreased from 0.38% as of March 31, 2021 to 0.35% as of June 30, 2021. Net charge-offs were $2.5 million for both the first and second quarter of 2021.

Non-performing loans at June 30, 2021 were $22.4 million, $31.8 million, $380,000, $1.6 million and $2.7 million in the Arkansas, Florida, Alabama, Shore Premier Finance and Centennial CFG markets, respectively, for a total of $58.9 million. Non-performing assets at June 30, 2021 were $23.2 million, $32.9 million, $424,000, $1.6 million and $2.8 million in the Arkansas, Florida, Alabama, Shore Premier Finance and Centennial CFG markets, respectively, for a total of $60.9 million.

The Company’s allowance for credit losses on loans was $240.5 million at June 30, 2021, or 2.36% of total loans, compared to the allowance for credit losses of $242.9 million, or 2.25% of total loans, at March 31, 2021. The Company’s allowance for credit losses on loans to total loans, excluding PPP loans (non-GAAP), was 2.47%(1) at June 30, 2021. As of June 30, 2021 and March 31, 2021, the Company’s allowance for credit losses on loans was 407.99% and 383.47% of its total non-performing loans, respectively.

Stockholders’ equity was $2.70 billion at June 30, 2021 compared to $2.65 billion at March 31, 2021, an increase of approximately $51.0 million. The increase in stockholders’ equity was primarily associated with the $56.0 million increase in retained earnings and a $9.7 million increase in accumulated other comprehensive income, which was partially offset by net stock repurchases and share-based compensation activity of $14.7 million. Book value per common share was $16.39 at June 30, 2021 compared to $16.02 at March 31, 2021. Tangible book value per common share (non-GAAP) was $10.31(1) at June 30, 2021 compared to $9.95(1) at March 31, 2021, an increase of 14.51% on an annualized basis.    ______________________________(1) Calculation of this metric and the reconciliation to GAAP are included in the schedules accompanying this release.

Branches

The Company currently has 76 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, July 15, 2021. We encourage all participants to pre-register for the conference call using the following link: https://dpregister.com/sreg/10157552/e986b17690. 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: 10157552, which will be available until July 22, 2021 at 10:59 p.m. CT (11:59 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; pre-tax, pre-provision, net income (PPNR); pre-tax, pre-provision, profit percentage; diluted earnings per common share, as adjusted; return on average assets, as adjusted; return on average assets excluding intangible amortization; return on average common equity, as adjusted; return on average tangible common equity; return on average tangible common equity excluding intangible amortization; return on average tangible common equity, as adjusted; efficiency ratio, as adjusted; net interest margin, excluding PPP loans; allowance for credit losses to total loans, excluding PPP loans; 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 (including the effect of the PPP loans) 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, real estate values and unemployment; disruptions, uncertainties and related effects on our business and operations as a result of the ongoing coronavirus (COVID-19) pandemic and measures that have been or may be implemented or imposed in response to the pandemic, including the impact on, among other things, credit quality and liquidity; the ability to identify, complete and successfully integrate new acquisitions; legislative and regulatory changes and risks and expenses associated with current and future legislation and regulations, including those in response to the COVID-19 pandemic; technological changes and cybersecurity risks; the effects of changes in accounting policies and practices; changes in governmental monetary and fiscal policies; political instability; competition from other financial institutions; potential claims, expenses and other adverse effects related to current or future litigation, regulatory examinations or other government actions; 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, 2020, filed with the SEC on February 26, 2021.

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 TownsellDirector of Investor RelationsHome BancShares, Inc.(501) 328-4625

Home BancShares, Inc.Consolidated End of Period Balance Sheets(Unaudited)

		Jun. 30,				Mar. 31,				Dec. 31,				Sep. 30,				Jun. 30,
(In thousands)		2021				2021				2020				2020				2020
ASSETS
Cash and due from banks		$	182,226			$	218,814			$	242,173			$	144,197			$	185,047
Interest-bearing deposits with other banks			2,759,027				2,259,734				1,021,615				899,140				1,030,609
Cash and cash equivalents			2,941,253				2,478,548				1,263,788				1,043,337				1,215,656
Investment securities - available-for-sale, net of
allowance for credit losses			3,053,712				2,539,123				2,473,781				2,361,900				2,238,005
Loans receivable			10,199,175				10,778,493				11,220,721				11,691,470				11,955,743
Allowance for credit losses			(240,451	)			(242,932	)			(245,473	)			(248,224	)			(238,340	)
Loans receivable, net			9,958,724				10,535,561				10,975,248				11,443,246				11,717,403
Bank premises and equipment, net			278,502				278,620				278,614				280,364				279,498
Foreclosed assets held for sale			1,969				3,004				4,420				4,322				6,292
Cash value of life insurance			104,132				103,599				103,519				102,989				102,443
Accrued interest receivable			48,725				55,495				60,528				72,599				80,274
Deferred tax asset, net			72,273				77,145				70,249				75,167				74,333
Goodwill			973,025				973,025				973,025				973,025				973,025
Core deposit and other intangibles			27,886				29,307				30,728				32,149				33,569
Other assets			166,991				166,814				164,904				160,660				174,908
Total assets		$	17,627,192			$	17,240,241			$	16,398,804			$	16,549,758			$	16,895,406
LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities
Deposits:
Demand and non-interest-bearing		$	4,076,570			$	3,859,722			$	3,266,753			$	3,207,967			$	3,413,727
Savings and interest-bearing transaction accounts			8,744,900				8,477,208				8,212,240				8,011,200				7,970,979
Time deposits			1,069,871				1,175,664				1,246,797				1,718,299				1,793,230
Total deposits			13,891,341				13,512,594				12,725,790				12,937,466				13,177,936
Securities sold under agreements to repurchase			150,540				162,929				168,931				158,447				162,858
FHLB and other borrowed funds			400,000				400,000				400,000				403,428				531,432
Accrued interest payable and other liabilities			118,415				148,999				127,999				139,485				161,095
Subordinated debentures			370,707				370,515				370,326				370,133				369,939
Total liabilities			14,931,003				14,595,037				13,793,046				14,008,959				14,403,260
Stockholders’ equity
Common stock			1,645				1,651				1,651				1,652				1,652
Capital surplus			1,501,615				1,516,286				1,520,617				1,520,103				1,518,631
Retained earnings			1,163,810				1,107,818				1,039,370				980,699				932,856
Accumulated other comprehensive income			29,119				19,449				44,120				38,345				39,007
Total stockholders’ equity			2,696,189				2,645,204				2,605,758				2,540,799				2,492,146
Total liabilities and stockholders’ equity		$	17,627,192			$	17,240,241			$	16,398,804			$	16,549,758			$	16,895,406

Home BancShares, Inc.Consolidated Statements of Income(Unaudited)

		Quarter Ended																				Six Months Ended
		Jun. 30,				Mar. 31,				Dec. 31,				Sep. 30,				Jun. 30,				Jun. 30,				Jun. 30,
(In thousands)		2021				2021				2020				2020				2020				2021				2020
Interest income
Loans		$	141,684			$	150,917			$	153,407			$	154,787			$	158,996			$	292,601			$	317,144
Investment securities
Taxable			7,185				6,253				6,900				7,227				8,693				13,438				18,469
Tax-exempt			4,905				5,071				4,979				4,367				3,698				9,976				6,812
Deposits - other banks			707				410				270				252				211				1,117				1,327
Federal funds sold			-				-				-				-				-				-				21
Total interest income			154,481				162,651				165,556				166,633				171,598				317,132				343,773
Interest expense
Interest on deposits			6,434				7,705				10,596				13,200				15,116				14,139				39,314
Federal funds purchased			-				-				-				-				-				-				13
FHLB borrowed funds			1,896				1,875				1,917				2,235				2,656				3,771				5,354
Securities sold under agreements to repurchase			107				190				208				237				260				297				722
Subordinated debentures			4,792				4,793				4,810				4,823				4,899				9,585				9,978
Total interest expense			13,229				14,563				17,531				20,495				22,931				27,792				55,381
Net interest income			141,252				148,088				148,025				146,138				148,667				289,340				288,392
Provision for credit losses - loans			-				-				-				14,000				11,441				-				98,264
Provision for credit loss - unfunded commitments			(4,752	)			-				-				-				9,214				(4,752	)			16,989
Total credit loss expense			(4,752	)			-				-				14,000				20,655				(4,752	)			115,253
Net interest income after provision for credit losses			146,004				148,088				148,025				132,138				128,012				294,092				173,139
Non-interest income
Service charges on deposit accounts			5,116				5,002				5,544				4,910				4,296				10,118				10,927
Other service charges and fees			9,659				7,608				8,425				8,539				7,666				17,267				13,722
Trust fees			444				522				420				378				397				966				835
Mortgage lending income			6,202				8,167				10,071				10,177				6,196				14,369				8,817
Insurance commissions			478				492				366				271				533				970				1,211
Increase in cash value of life insurance			537				502				534				548				558				1,039				1,118
Dividends from FHLB, FRB, FNBB & other			2,646				8,609				967				3,433				230				11,255				8,072
Gain on SBA loans			1,149				-				304				-				-				1,149				341
(Loss) gain on branches, equipment and
other assets, net			(23	)			(29	)			217				(27	)			54				(52	)			136
Gain on OREO, net			619				401				150				470				235				1,020				512
Gain on securities, net			-				219				-				-				-				219				-
Fair value adjustment for marketable securities			1,250				5,782				4,271				(1,350	)			919				7,032				(4,899	)
Other income			3,043				8,001				2,616				2,602				3,939				11,044				7,158
Total non-interest income			31,120				45,276				33,885				29,951				25,023				76,396				47,950
Non-interest expense
Salaries and employee benefits			42,462				42,059				43,022				41,511				40,088				84,521				79,417
Occupancy and equipment			9,042				9,237				9,801				9,566				10,172				18,279				19,045
Data processing expense			5,893				5,870				5,171				4,921				4,614				11,763				8,940
Other operating expenses			15,585				15,700				16,247				15,714				16,084				31,285				34,030
Total non-interest expense			72,982				72,866				74,241				71,712				70,958				145,848				141,432
Income (loss) before income taxes			104,142				120,498				107,669				90,377				82,077				224,640				79,657
Income tax expense (benefit)			25,072				28,896				25,875				21,057				19,250				53,968				16,323
Net income		$	79,070			$	91,602			$	81,794			$	69,320			$	62,827			$	170,672			$	63,334

Home BancShares, Inc.Selected Financial Information(Unaudited)

		Quarter Ended																				Six Months Ended
(Dollars and shares in thousands,		Jun. 30,				Mar. 31,				Dec. 31,				Sep. 30,				Jun. 30,				Jun. 30,				Jun. 30,
except per share data)		2021				2021				2020				2020				2020				2021				2020
PER SHARE DATA
Diluted earnings per common share		$	0.48			$	0.55			$	0.50			$	0.42			$	0.38			$	1.03			$	0.38
Diluted earnings per common share, as adjusted,
excluding fair value adjustment for marketable securities, special dividend from equity investment, gain on securities, recoveries on historic losses, branch write-off expense, outsourced special project expense & merger and acquisition expenses (non-GAAP)(1)			0.46				0.47				0.48				0.41				0.38				0.93				0.39
Basic earnings per common share			0.48				0.55				0.50				0.42				0.38				1.03				0.38
Dividends per share - common			0.14				0.14				0.14				0.13				0.13				0.28				0.26
Book value per common share			16.39				16.02				15.78				15.38				15.09				16.39				15.09
Tangible book value per common share (non-GAAP)(1)			10.31				9.95				9.70				9.30				8.99				10.31				8.99
STOCK INFORMATION
Average common shares outstanding			164,781				165,257				165,119				165,200				165,163				165,018				165,588
Average diluted shares outstanding			165,226				165,446				165,119				165,200				165,163				165,314				165,588
End of period common shares outstanding			164,488				165,141				165,095				165,163				165,206				164,488				165,206
ANNUALIZED PERFORMANCE METRICS
Return on average assets			1.81	%			2.22	%			1.97	%			1.66	%			1.55	%			2.01	%			0.81	%
Return on average assets excluding fair value adjustment
for marketable securities, special dividend from equity investment, gain on securities, recoveries on historic losses, branch write-off expense, outsourced special project expense & merger and acquisition expenses: (ROA, as adjusted) (non-GAAP)(1)			1.75	%			1.88	%			1.90	%			1.63	%			1.55	%			1.81	%			0.82	%
Return on average assets excluding intangible
amortization (non-GAAP)(1)			1.95	%			2.39	%			2.13	%			1.80	%			1.68	%			2.16	%			0.90	%
Return on average common equity			11.92	%			14.15	%			12.72	%			10.97	%			10.27	%			13.02	%			5.16	%
Return on average common equity excluding fair value
adjustment for marketable securities, special dividend from equity investment, gain on securities, recoveries on historic losses, branch write-off expense, outsourced special project expense & merger and acquisition expenses: (ROE, as adjusted) (non-GAAP)(1)			11.54	%			11.96	%			12.23	%			10.76	%			10.28	%			11.75	%			5.20	%
Return on average tangible common equity
(non-GAAP)(1)			19.12	%			22.90	%			20.96	%			18.29	%			17.40	%			20.98	%			8.68	%
Return on average tangible common equity excluding
intangible amortization (non-GAAP)(1)			19.38	%			23.16	%			21.22	%			18.56	%			17.70	%			21.24	%			8.98	%
Return on average tangible common equity excluding fair
value adjustment for marketable securities, special dividend from equity investment, gain on securities, recoveries on historic losses, branch write-off expense, outsourced special project expense & merger and acquisition expenses: (ROTCE, as adjusted) (non-GAAP)(1)			18.51	%			19.35	%			20.15	%			17.93	%			17.41	%			18.92	%			8.75	%

(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)

		Quarter Ended																				Six Months Ended
		Jun. 30,				Mar. 31,				Dec. 31,				Sep. 30,				Jun. 30,				Jun. 30,				Jun. 30,
(Dollars in thousands)		2021				2021				2020				2020				2020				2021				2020
Efficiency ratio			41.08	%			36.60	%			39.64	%			39.56	%			39.67	%			38.71	%			40.83	%
Efficiency ratio, as adjusted (non-GAAP)(1)			42.06	%			40.67	%			40.67	%			40.08	%			39.38	%			41.35	%			40.34	%
Net interest margin - FTE			3.61	%			4.02	%			4.00	%			3.92	%			4.11	%			3.81	%			4.17	%
Net interest margin - FTE, excluding PPP loans
(non-GAAP)(1)			3.54	%			3.87	%			3.97	%			3.98	%			4.16	%			3.70	%			4.19	%
Fully taxable equivalent adjustment		$	1,810			$	1,857			$	1,778			$	1,576			$	1,434			$	3,667			$	2,661
Total revenue (net)			172,372				193,364				181,910				176,089				173,690				365,736				336,342
Pre-tax, pre-provision, net income (PPNR) (non-GAAP)(1)			99,390				120,498				107,669				104,377				102,732				219,888				194,910
Pre-tax net income to total revenue (net)			60.42	%			62.32	%			59.19	%			51.32	%			47.25	%			61.42	%			23.68	%
P5NR (Pre-tax, pre-provision, profit percentage)
(PPNR to total revenue (net)) (non-GAAP)(1)			57.66	%			62.32	%			59.19	%			59.28	%			59.15	%			60.12	%			57.95	%
Total purchase accounting accretion			5,797				5,485				5,736				6,957				7,036				11,282				14,683
Average purchase accounting loan discounts			38,568				43,940				49,563				55,835				62,822				41,218				66,105
OTHER OPERATING EXPENSES
Advertising		$	1,194			$	1,046			$	1,076			$	902			$	795			$	2,240			$	2,021
Merger and acquisition expenses			-				-				-				-				-				-				711
Amortization of intangibles			1,421				1,421				1,421				1,420				1,486				2,842				3,003
Electronic banking expense			2,616				2,238				2,282				2,426				2,054				4,854				3,769
Directors’ fees			414				383				359				429				412				797				836
Due from bank service charges			273				249				254				259				239				522				462
FDIC and state assessment			1,108				1,363				1,493				1,607				1,846				2,471				3,394
Insurance			787				781				795				766				711				1,568				1,457
Legal and accounting			1,058				846				790				1,235				1,278				1,904				2,197
Other professional fees			1,796				1,613				1,528				1,661				1,735				3,409				4,961
Operating supplies			465				487				440				460				553				952				1,088
Postage			292				338				315				328				313				630				640
Telephone			365				346				347				321				310				711				634
Other expense			3,796				4,589				5,147				3,900				4,352				8,385				8,857
Total other operating expenses		$	15,585			$	15,700			$	16,247			$	15,714			$	16,084			$	31,285			$	34,030

(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)

		Jun. 30,				Mar. 31,				Dec. 31,				Sep. 30,				Jun. 30,
(Dollars in thousands)		2021				2021				2020				2020				2020
BALANCE SHEET RATIOS
Total loans to total deposits			73.42	%			79.77	%			88.17	%			90.37	%			90.73	%
Common equity to assets			15.30	%			15.34	%			15.89	%			15.35	%			14.75	%
Tangible common equity to tangible assets (non-GAAP)(1)			10.20	%			10.12	%			10.41	%			9.88	%			9.35	%
LOANS RECEIVABLE
Real estate
Commercial real estate loans
Non-farm/non-residential		$	4,144,375			$	4,289,142			$	4,429,060			$	4,342,141			$	4,325,795
Construction/land development			1,541,482				1,612,973				1,562,298				1,748,928				1,818,151
Agricultural			126,293				113,382				114,431				89,476				105,554
Residential real estate loans
Residential 1-4 family			1,316,485				1,437,546				1,536,257				1,665,628				1,730,716
Multifamily residential			332,256				377,661				536,538				491,380				482,635
Total real estate			7,460,891				7,830,704				8,178,584				8,337,553				8,462,851
Consumer			824,938				839,819				864,690				883,568				851,344
Commercial and industrial			1,612,826				1,794,787				1,896,442				2,161,818				2,228,816
Agricultural			69,152				65,017				66,869				85,365				80,023
Other			231,368				248,166				214,136				223,166				332,709
Loans receivable		$	10,199,175			$	10,778,493			$	11,220,721			$	11,691,470			$	11,955,743
Paycheck Protection Program (PPP) loans (net of discounts)
(included in total loans receivable)			473,894				646,382				675,225				825,362				819,154
ALLOWANCE FOR CREDIT LOSSES
Balance, beginning of period		$	242,932			$	245,473			$	248,224			$	238,340			$	228,923
Loans charged off			3,023				3,047				3,040				4,599				2,582
Recoveries of loans previously charged off			542				506				289				483				558
Net loans charged off			2,481				2,541				2,751				4,116				2,024
Provision for credit losses - loans			-				-				-				14,000				11,441
Balance, end of period		$	240,451			$	242,932			$	245,473			$	248,224			$	238,340
Net charge-offs to average total loans			0.09	%			0.09	%			0.10	%			0.14	%			0.07	%
Allowance for credit losses to total loans			2.36	%			2.25	%			2.19	%			2.12	%			1.99	%
Allowance for credit losses to total loans, excluding PPP loans			2.47	%			2.40	%			2.33	%			2.28	%			2.14	%
NON-PERFORMING ASSETS
Non-performing loans
Non-accrual loans		$	55,269			$	59,142			$	64,528			$	65,148			$	52,074
Loans past due 90 days or more			3,667				4,209				9,610				8,635				7,824
Total non-performing loans			58,936				63,351				74,138				73,783				59,898
Other non-performing assets
Foreclosed assets held for sale, net			1,969				3,004				4,420				4,322				6,292
Other non-performing assets			-				-				-				247				247
Total other non-performing assets			1,969				3,004				4,420				4,569				6,539
Total non-performing assets		$	60,905			$	66,355			$	78,558			$	78,352			$	66,437
Allowance for credit losses for loans to non-performing loans			407.99	%			383.47	%			331.10	%			336.42	%			397.91	%
Non-performing loans to total loans			0.58	%			0.59	%			0.66	%			0.63	%			0.50	%
Non-performing assets to total assets			0.35	%			0.38	%			0.48	%			0.47	%			0.39	%

(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
		June 30, 2021										March 31, 2021
		Average			Income/			Yield/				Average			Income/			Yield/
(Dollars in thousands)		Balance			Expense			Rate				Balance			Expense			Rate
ASSETS
Earning assets
Interest-bearing balances due from banks		$	2,577,101		$	707			0.11	%		$	1,610,463		$	410			0.10	%
Federal funds sold			51			-			0.00	%			119			-			0.00	%
Investment securities - taxable			1,909,485			7,185			1.51	%			1,637,061			6,253			1.55	%
Investment securities - non-taxable - FTE			864,416			6,527			3.03	%			848,158			6,732			3.22	%
Loans receivable - FTE			10,541,466			141,872			5.40	%			11,023,139			151,113			5.56	%
Total interest-earning assets			15,892,519			156,291			3.94	%			15,118,940			164,508			4.41	%
Non-earning assets			1,598,840										1,599,950
Total assets		$	17,491,359									$	16,718,890
LIABILITIES AND SHAREHOLDERS’ EQUITY
Liabilities
Interest-bearing liabilities
Savings and interest-bearing transaction accounts		$	8,684,726		$	3,960			0.18	%		$	8,338,791		$	4,716			0.23	%
Time deposits			1,123,287			2,474			0.88	%			1,209,431			2,989			1.00	%
Total interest-bearing deposits			9,808,013			6,434			0.26	%			9,548,222			7,705			0.33	%
Federal funds purchased			-			-			0.00	%			-			-			0.00	%
Securities sold under agreement to repurchase			157,570			107			0.27	%			159,697			190			0.48	%
FHLB borrowed funds			400,000			1,896			1.90	%			400,000			1,875			1.90	%
Subordinated debentures			370,613			4,792			5.19	%			370,421			4,793			5.25	%
Total interest-bearing liabilities			10,736,196			13,229			0.49	%			10,478,340			14,563			0.56	%
Non-interest bearing liabilities
Non-interest bearing deposits			3,966,968										3,480,050
Other liabilities			128,048										134,882
Total liabilities			14,831,212										14,093,272
Shareholders’ equity			2,660,147										2,625,618
Total liabilities and shareholders’ equity		$	17,491,359									$	16,718,890
Net interest spread									3.45	%									3.85	%
Net interest income and margin - FTE					$	143,062			3.61	%					$	149,945			4.02	%

Home BancShares, Inc.Consolidated Net Interest Margin(Unaudited)

		Six Months Ended
		June 30, 2021										June 30, 2020
		Average			Income/			Yield/				Average			Income/			Yield/
(Dollars in thousands)		Balance			Expense			Rate				Balance			Expense			Rate
ASSETS
Earning assets
Interest-bearing balances due from banks		$	2,096,452		$	1,117			0.11	%		$	542,066		$	1,327			0.49	%
Federal funds sold			84			-			0.00	%			2,609			21			1.62	%
Investment securities - taxable			1,774,026			13,438			1.53	%			1,690,083			18,469			2.20	%
Investment securities - non-taxable - FTE			856,332			13,259			3.12	%			417,919			8,981			4.32	%
Loans receivable - FTE			10,780,972			292,985			5.48	%			11,399,178			317,636			5.60	%
Total interest-earning assets			15,507,866			320,799			4.17	%			14,051,855			346,434			4.96	%
Non-earning assets			1,599,393										1,674,486
Total assets		$	17,107,259									$	15,726,341
LIABILITIES AND SHAREHOLDERS’ EQUITY
Liabilities
Interest-bearing liabilities
Savings and interest-bearing transaction accounts		$	8,512,714		$	8,677			0.21	%		$	7,346,281		$	23,621			0.65	%
Time deposits			1,166,121			5,462			0.94	%			1,899,673			15,693			1.66	%
Total interest-bearing deposits			9,678,835			14,139			0.29	%			9,245,954			39,314			0.86	%
Federal funds purchased			-			-			0.00	%			3,132			13			0.83	%
Securities sold under agreement to repurchase			158,628			297			0.38	%			146,404			722			0.99	%
FHLB borrowed funds			400,000			3,771			1.90	%			637,940			5,354			1.69	%
Subordinated debentures			370,518			9,585			5.22	%			369,749			9,978			5.43	%
Total interest-bearing liabilities			10,607,981			27,792			0.53	%			10,403,179			55,381			1.07	%
Non-interest bearing liabilities
Non-interest bearing deposits			3,724,854										2,724,537
Other liabilities			131,446										128,102
Total liabilities			14,464,281										13,255,818
Shareholders’ equity			2,642,978										2,470,523
Total liabilities and shareholders’ equity		$	17,107,259									$	15,726,341
Net interest spread									3.64	%									3.89	%
Net interest income and margin - FTE					$	293,007			3.81	%					$	291,053			4.17	%

Home BancShares, Inc.Non-GAAP Reconciliations(Unaudited)

		Quarter Ended																				Six Months Ended
(Dollars and shares in thousands,		Jun. 30,				Mar. 31,				Dec. 31,				Sep. 30,				Jun. 30,				Jun. 30,				Jun. 30,
except per share data)		2021				2021				2020				2020				2020				2021				2020
EARNINGS, AS ADJUSTED
GAAP net income available to common shareholders (A)		$	79,070			$	91,602			$	81,794			$	69,320			$	62,827			$	170,672			$	63,334
Pre-tax adjustments
Fair value adjustment for marketable securities			(1,250	)			(5,782	)			(4,271	)			1,350				(919	)			(7,032	)			4,899
Special dividend from equity investment			(2,200	)			(8,073	)			-				(3,181	)			-				(10,273	)			(7,004	)
Gain on securities			-				(219	)			-				-				-				(219	)			-
Recoveries on historic losses			-				(5,107	)			-				-				-				(5,107	)			-
Branch write-off expense			-				-				-				-				981				-				981
Outsourced special project expense			-				-				-				-				-				-				1,092
Merger and acquisition expenses			-				-				-				-				-				-				711
Total pre-tax adjustments			(3,450	)			(19,181	)			(4,271	)			(1,831	)			62				(22,631	)			679
Tax-effect of adjustments			(902	)			(5,013	)			(1,116	)			(479	)			16				(5,915	)			177
Total adjustments after-tax (B)			(2,548	)			(14,168	)			(3,155	)			(1,352	)			46				(16,716	)			502
Earnings, as adjusted (C)		$	76,522			$	77,434			$	78,639			$	67,968			$	62,873			$	153,956			$	63,836
Average diluted shares outstanding (D)			165,226				165,446				165,119				165,200				165,163				165,314				165,588
GAAP diluted earnings per share: (A/D)		$	0.48			$	0.55			$	0.50			$	0.42			$	0.38			$	1.03			$	0.38
Adjustments after-tax: (B/D)			(0.02	)			(0.08	)			(0.02	)			(0.01	)			-				(0.10	)			0.01
Diluted earnings per common share, as
adjusted, excluding fair value adjustment for marketable securities, special dividend from equity investment, gain on securities, recoveries on historic losses, branch write-off expense, outsourced special project expense & merger and acquisition expenses: (C/D)		$	0.46			$	0.47			$	0.48			$	0.41			$	0.38			$	0.93			$	0.39
ANNUALIZED RETURN ON AVERAGE ASSETS
Return on average assets: (A/G)			1.81	%			2.22	%			1.97	%			1.66	%			1.55	%			2.01	%			0.81	%
Return on average assets excluding fair
value adjustment for marketable securities, special dividend from equity investment, gain on securities, recoveries on historic losses, branch write-off expense, outsourced special project expense & merger and acquisition expenses: (ROA, as adjusted) ((A+F)/G)			1.75	%			1.88	%			1.90	%			1.63	%			1.55	%			1.81	%			0.82	%
Return on average assets excluding intangible
amortization: ((A+E)/(G-H))			1.95	%			2.39	%			2.13	%			1.80	%			1.68	%			2.16	%			0.90	%
GAAP net income available to common shareholders (A)		$	79,070			$	91,602			$	81,794			$	69,320			$	62,827			$	170,672			$	63,334
Amortization of intangibles (D)			1,421				1,421				1,421				1,420				1,486				2,842				3,003
Amortization of intangibles after-tax (E)			1,049				1,049				1,049				1,049				1,098				2,098				2,218
Adjustments after-tax (F)			(2,548	)			(14,168	)			(3,155	)			(1,352	)			46				(16,716	)			502
Average assets (G)			17,491,359				16,718,890				16,493,066				16,594,495				16,319,206				17,107,259				15,726,341
Average goodwill, core deposits & other
intangible assets (H)			1,001,598				1,003,011				1,004,432				1,005,864				1,007,307				1,002,301				1,003,156

Home BancShares, Inc.Non-GAAP Reconciliations(Unaudited)

		Quarter Ended																				Six Months Ended
		Jun. 30,				Mar. 31,				Dec. 31,				Sep. 30,				Jun. 30,				Jun. 30,				Jun. 30,
(Dollars in thousands)		2021				2021				2020				2020				2020				2021				2020
ANNUALIZED RETURN ON AVERAGE COMMON EQUITY
Return on average common equity: (A/D)			11.92	%			14.15	%			12.72	%			10.97	%			10.27	%			13.02	%			5.16	%
Return on average common equity excluding fair value
adjustment for marketable securities, special dividend from equity investment, gain on securities, recoveries on historic losses, branch write-off expense, outsourced special project expense & merger and acquisition expenses: (ROE, as adjusted) ((A+C)/D)			11.54	%			11.96	%			12.23	%			10.76	%			10.28	%			11.75	%			5.20	%
Return on average tangible common equity: (A/(D-E))			19.12	%			22.90	%			20.96	%			18.29	%			17.40	%			20.98	%			8.68	%
Return on average tangible common equity
excluding intangible amortization: (B/(D-E))			19.38	%			23.16	%			21.22	%			18.56	%			17.70	%			21.24	%			8.98	%
Return on average tangible common equity excluding
fair value adjustment for marketable securities, special dividend from equity investment, gain on securities, recoveries on historic losses, branch write-off expense, outsourced special project expense & merger and acquisition expenses: (ROTCE, as adjusted) ((A+C)/(D-E))			18.51	%			19.35	%			20.15	%			17.93	%			17.41	%			18.92	%			8.75	%
GAAP net income available to common shareholders (A)		$	79,070			$	91,602			$	81,794			$	69,320			$	62,827			$	170,672			$	63,334
Earnings excluding intangible amortization (B)			80,119				92,651				82,843				70,369				63,925				172,770				65,553
Adjustments after-tax (C)			(2,548	)			(14,168	)			(3,155	)			(1,352	)			46				(16,716	)			502
Average common equity (D)			2,660,147				2,625,618				2,557,251				2,513,792				2,459,941				2,642,978				2,470,523
Average goodwill, core deposits & other intangible assets (E)			1,001,598				1,003,011				1,004,432				1,005,864				1,007,307				1,002,301				1,003,156
EFFICIENCY RATIO & P5NR
Efficiency ratio: ((D-F)/(B+C+E))			41.08	%			36.60	%			39.64	%			39.56	%			39.67	%			38.71	%			40.83	%
Efficiency ratio, as adjusted: ((D-F-H)/(B+C+E-G))			42.06	%			40.67	%			40.67	%			40.08	%			39.38	%			41.35	%			40.34	%
Pre-tax net income to total revenue (net) (A/(B+C))			60.42	%			62.32	%			59.19	%			51.32	%			47.25	%			61.42	%			23.68	%
Pre-tax, pre-provision, net income (PPNR) (B+C-D)		$	99,390			$	120,498			$	107,669			$	104,377			$	102,732			$	219,888			$	194,910
P5NR (Pre-tax, pre-provision, profit
percentage) PPNR to total revenue (net) (B+C-D)/(B+C)			57.66	%			62.32	%			59.19	%			59.28	%			59.15	%			60.12	%			57.95	%
Pre-tax net income (A)		$	104,142			$	120,498			$	107,669			$	90,377			$	82,077			$	224,640			$	79,657
Net interest income (B)			141,252				148,088				148,025				146,138				148,667				289,340				288,392
Non-interest income (C)			31,120				45,276				33,885				29,951				25,023				76,396				47,950
Non-interest expense (D)			72,982				72,866				74,241				71,712				70,958				145,848				141,432
Fully taxable equivalent adjustment (E)			1,810				1,857				1,778				1,576				1,434				3,667				2,661
Amortization of intangibles (F)			1,421				1,421				1,421				1,420				1,486				2,842				3,003
Adjustments:
Non-interest income:
Fair value adjustment for marketable securities		$	1,250			$	5,782			$	4,271			$	(1,350	)		$	919			$	7,032			$	(4,899	)
Gain (loss) on OREO			619				401				150				470				235				1,020				512
Gain (loss) on branches, equipment and other assets, net			(23	)			(29	)			217				(27	)			54				(52	)			136
Special dividend from equity investment			2,200				8,073				-				3,181				-				10,273				7,004
Gain (loss) on securities			-				219				-				-				-				219				-
Recoveries on historic losses			-				5,107				-				-				-				5,107				-
Total non-interest income adjustments (G)		$	4,046			$	19,553			$	4,638			$	2,274			$	1,208			$	23,599			$	2,753
Non-interest expense:
Branch write-off expense		$	-			$	-			$	-			$	-			$	981			$	-			$	981
Merger Expenses			-				-				-				-				-				-				711
Outsourced special project expense			-				-				-				-				-				-				1,092
Total non-interest expense adjustments (H)		$	-			$	-			$	-			$	-			$	981			$	-			$	2,784

Home BancShares, Inc.Non-GAAP Reconciliations(Unaudited)

		Quarter Ended																				Six Months Ended
		Jun. 30,				Mar. 31,				Dec. 31,				Sep. 30,				Jun. 30,				Jun. 30,				Jun. 30,
(Dollars in thousands)		2021				2021				2020				2020				2020				2021				2020
ANNUALIZED NET INTEREST MARGIN
Net interest margin: (A/C)			3.61	%			4.02	%			4.00	%			3.92	%			4.11	%			3.81	%			4.17	%
Net interest margin, excluding PPP loans:
(B/D)			3.54	%			3.87	%			3.97	%			3.98	%			4.16	%			3.70	%			4.19	%
Net interest income - FTE (A)		$	143,062			$	149,945			$	149,803			$	147,714			$	150,101			$	293,007			$	291,053
PPP loan interest & discount accretion
income			7,802				11,878				8,841				5,943				4,450				19,680				4,450
Net interest income - FTE, excluding
PPP loans (B)		$	135,260			$	138,067			$	140,962			$	141,771			$	145,651			$	273,327			$	286,603
Average interest-earning assets (C)		$	15,892,519			$	15,118,940			$	14,900,381			$	14,975,146			$	14,678,465			$	15,507,866			$	14,051,855
Average PPP loans			581,371				633,790				775,861				821,977				585,946				607,436				292,973
Average interest-earning assets, excluding
PPP loans (D)		$	15,311,148			$	14,485,150			$	14,124,520			$	14,153,169			$	14,092,519			$	14,900,430			$	13,758,882
		Jun. 30,				Mar. 31,				Dec. 31,				Sep. 30,				Jun. 30,
		2021				2021				2020				2020				2020
TANGIBLE BOOK VALUE PERCOMMON SHARE
Book value per common share: (A/B)		$	16.39			$	16.02			$	15.78			$	15.38			$	15.09
Tangible book value per common share:
((A-C-D)/B)			10.31				9.95				9.70				9.30				8.99
Total stockholders’ equity (A)		$	2,696,189			$	2,645,204			$	2,605,758			$	2,540,799			$	2,492,146
End of period common shares outstanding (B)			164,488				165,141				165,095				165,163				165,206
Goodwill (C)			973,025				973,025				973,025				973,025				973,025
Core deposit and other intangibles (D)			27,886				29,307				30,728				32,149				33,569
TANGIBLE COMMON EQUITYTO TANGIBLE ASSETS
Equity to assets: (B/A)			15.30	%			15.34	%			15.89	%			15.35	%			14.75	%
Tangible common equity to tangible assets:
((B-C-D)/(A-C-D))			10.20	%			10.12	%			10.41	%			9.88	%			9.35	%
Total assets (A)		$	17,627,192			$	17,240,241			$	16,398,804			$	16,549,758			$	16,895,406
Total stockholders’ equity (B)			2,696,189				2,645,204				2,605,758				2,540,799				2,492,146
Goodwill (C)			973,025				973,025				973,025				973,025				973,025
Core deposit and other intangibles (D)			27,886				29,307				30,728				32,149				33,569