Home BancShares, Inc. (HOMB)

Get HOMB Alerts
*Delayed - data as of Apr. 29, 2016  -  Find a broker to begin trading HOMB now
Exchange: NASDAQ
Industry: Finance
Community Rating:
Symbol List Views
FlashQuotes InfoQuotes
Stock Details
Summary Quote Real-Time Quote After Hours Quote Pre-market Quote Historical Quote Option Chain
Basic Chart Interactive Chart
Company Headlines Press Releases Market Stream
Analyst Research Guru Analysis Stock Report Competitors Stock Consultant Stock Comparison
Call Transcripts Annual Report Income Statement Revenue/EPS SEC Filings Short Interest Dividend History
Ownership Summary Institutional Holdings Insiders
(SEC Form 4)
 Save Stocks

Home Bancshares, Inc. (HOMB)

Liberty Acquisition Analyst Conference Call

June 25, 2013 5:00 pm ET


John W. Allison – Chairman

Randy E. Mayor – Chief Financial Officer, Treasurer and Director

Brian S. Davis – Chief Accounting Officer and Head-Investor Relations

Kevin D. Hester – Chief Lending Officer

Donna Townsell – Vice President of Corporate Efficiencies


Michael Rose – Raymond James

Brian Martin – FIG Partners

Brian Zabora – Keefe, Bruyette, & Woods, Inc.

Kevin Reynolds – Wunderlich Securities

Matt Olney – Stephens, Inc.

Steve Covington – Stieven Capital

Jon Arfstrom – RBC Capital Markets



Good day and welcome to the Home Bancshares Analyst Conference Call and Webcast. All participants will be in listen-only mode (Operator Instructions). I would now like to turn the conference over to Mr. John Allison, Chairman. Mr. Allison, the floor is yours sir.

John W. Allison

Thank you, Mac. I appreciate it and welcome everyone. Randy Mayor and Brian Davis are in Conway. Randy Sims, Donna Townsell and myself are in Little Rock and Kevin Hester is in Florida. But we’re a little disjoined and we can’t see the monitor this time, but I just wanted to tell you, and announce to you, you probably already seen the news. This was a game changer deal that I’ve mentioned to you guys that was out there that I thought someday might land for us and it did. It was a $2.9 billion transaction. I think you’ve read all of the information creates $5.6 million deposits, $4.1 billion loans, and now 151 branches. The only overlap we have is malls in Arkansas, a small one there and I think they had one branch. Randy, we had one?

Randy E. Mayor

Yes sir.

John W. Allison

So it’s not a big item in Searcy, Arkansas, I think we have two and they have three.

Randy E. Mayor

Yes sir.

John W. Allison

Or four, so that will be some overlap there. But outside of that it absolutely fits like a glove, but the performance of Liberty has been pretty good. They’re running about an 8.85 ROA. We get it to our standards and you know what we think we can do with it. So someone said me, “What did you pay for it?” And I said that we bought it worth the money, it’s an accretive transaction.

The dilution to tangible book is fairly rapid less than 18 months and it could be quicker than that. We don’t anticipate going into slash and burn in Jonesboro, where we’re going to take our time, and pick out the good people and work with those people and hopefully let attrition take care of the numbers of people. Some of the good news is that it’s markets that we know well, it also they’re on our same data FIS, is that right?

Randy E. Mayor

Yes, sir.

John W. Allison

They’re on the same data system with us, FIS that’s going to make help with the conversion, due diligence went well. We marked the loans about 5% maybe a little tick over 5%. We marked OREO about 33%. The deal created about $60 million in goodwill. The bad news is we had about $80 million of goodwill. They had about $80 million of goodwill and the deal created about $60 million of goodwill. But it was only about $0.20 dilutive to tangible book. So we’re pretty pleased with that.

We don’t expect Liberty to be at optimum performance for 18 to 24 months, as we’re going to take our time and try to do it properly. Probably put us on the sideline for a little bit, if the regulators don’t put us on the sideline, we’ll put ourselves on the sideline, because this is a large transaction for us.

The Company has gotten pretty good as you know at doing these transactions and getting them efficient and we think we can glean lots of efficiency in this market, we’ll send down 1,000 of her group in there on the efficiency side and see if we can’t. I think they’re running about a 68%, 70% efficiency. So we’ll try to improve upon that. It is positive to book by about $1.50 or $2 dilutive to tangible book by about $0.20, $0.25 as I said. I’m not going to tell you how much it’s going to earn, but it’s good, and it will accomplish some goals that Home had set out.

Randy, you got any comments on the deal. We’ve worked on this one for, I’ve been on it for 10 years and it finally came to being and Fowler family is they’re great people Wallace and his son will join us on the Board to represent the Liberty shareholders.

Randy E. Mayor

I would just add that it is two great friends coming together to put together one of the largest banking institutions in Arkansas. Definitely the largest instate transaction ever in the history of Arkansas. So we’re making a little bit of history as we go down the road.

As Johnny mentioned, the overlap is amazing, very little, insignificant and so it opens up both institutions to really have a great footprint across the State of Arkansas. We’ve talked in the past quarters about the performance of Arkansas and the performance of Florida, and you know that Arkansas has been a stellar performer and we hope that these same standards will apply as the two institutions come together.

There is a lot of good efficiencies that we’ve got ahead of us. Johnny mentioned one, in fact Liberty when they first started, we processed them and in our data center. And so we are on the same system and we’re on a lot of same systems. So the learning curve, the conversion curve will be – we hopefully a lot quicker. In fact we’re looking towards maybe a December conversion and having this completely converted and into our systems by the end of the year.

Read the rest of this transcript for free on seekingalpha.com