Bank of the Ozarks sees rising costs as headwind to improving efficiency ratio
Bank of the Ozarks management said on the company's Q3 earnings call that "traditionally [the bank has] been among the most efficient Bank Holding Companies in the US. After recording a 35.5% efficiency ratio for the first six months of 2016, our efficiency ratio increased 38.1% in the quarter just ended." The company noted that it hopes to achieve an improving efficiency ratio over the next several years and ultimately a sub 30% efficiency ratio, but added that expanding its "human and physical infrastructure" to serve low to moderate income and majority/minority markets and customer segments will be a "headwind" in its efforts to improve its efficiency ratio. The company added: "However, we believe our excellent organic growth will generate sufficient additional revenue for us to achieve our longer term efficiency ratio goal. Our guidance regarding an improvement efficiency ratio in future years does not consider the potential impact of any future acquisitions."