Bank of the Ozarks (NASDAQ: OZRK) and First Arkansas Bank and Trust have reached an agreement resolving Bank of the Ozarks’ application to establish a Jacksonville, Arkansas branch and related litigation. The branch application was originally filed with bank regulatory authorities in December 2004 and has been the subject of various regulatory proceedings and ongoing litigation.
Earlier today Bank of the Ozarks sold the site previously acquired for its planned Jacksonville branch to First Arkansas Bank and Trust and announced that it will withdraw the contested branch application.
George Gleason, Chairman and Chief Executive Officer of Bank of the Ozarks, stated, “After more than two years of pursuing final approval of our contested Jacksonville branch application, we have concluded that further pursuit of this application would be a distraction from other more important priorities. After extensive discussions with First Arkansas Bank and Trust, we reached a mutual agreement to sell them our branch site and resolve the litigation related to the branch application. We have agreed not to open a branch within the present city limits of Jacksonville now or in the future. We will continue serving our existing Jacksonville customers, and we will aggressively seek new customers and new business in Jacksonville. We will serve our Jacksonville customers from our area offices, including our two branches in Cabot, our Sherwood branch and our four North Little Rock branches. We believe this resolution is in the best interest of all parties.”
Larry Wilson, Chairman, President and Chief Executive Officer of First Arkansas Bank and Trust, stated, “We protested Bank of the Ozarks’ branch application on the basis that there are a sufficient number of competitor banks serving Jacksonville. Bank of the Ozarks’ decision to withdraw their application reflects their assessment that they have better opportunities elsewhere. We are pleased to have this matter resolved, and to once again focus all of our efforts and energies on delivering great service and banking products to our many customers in our home town of Jacksonville and nearby communities.”
Mr. Gleason announced that Bank of the Ozarks will recognize a gain of approximately $17,000 on the sale of such site and $500,000 of other non-interest income related to the settlement of the contested branch application. Among other things, this settlement and payment reimbursed Bank of the Ozarks for expenses incurred in previous quarters related to the branch application and included an agreement from Bank of the Ozarks not to pursue any future branch application in the present city limits of Jacksonville.
Bank of the Ozarks is the wholly-owned bank subsidiary of Bank of the Ozarks, Inc., a bank holding company with $2.5 billion in total assets as of December 31, 2006 which trades on the NASDAQ Global Select Market under the symbol “OZRK.”
First Arkansas Bank & Trust is a family-owned and managed bank with total assets of $500 million. It is headquartered in Jacksonville and serves the central and north central Arkansas area with 25 locations.
