Home Bancshares, Inc. Q1 FY2026 earnings call

• Chairman John Allison highlighted strong first quarter results, sound expense control, record book values. Mentioned merger with Mountain Commerce, delay in converting due to back office upgrade. Talked about $110M Texas credit non-performing, but confident in resolving. Discussed stock repurchases, M&A opportunities. - Chris Fulton on CCFG: portfolio grew to $2.1B in Q1, $370M new loan production, payoffs $200M. Reduced private credit exposure over past three years due to market trends. - Stephen Tipton on earnings: $118.2M net income in Q1, 2.09% ROA, 16.56% ROE. Net interest margin 4.51%, loan yield 7.08%, deposit costs 2.35%. Deposits up $258M, non-interest bearing balances up. - Kevin Hester on lending: loan balances dropped ~$50M, but average loan balances up. Non-accrual of Texas C&I credit, but reserve coverage of non-performing loans over 160%

Book value per share was $22.15, tangible book value per share $14.87 (a $1.72 increase year over year, 13% increase). CET1 at 16.7%, leverage 14.3%, Tier 1 capital 16.7%. CCFG grew portfolio to approx $2.1 billion in Q1, $60M increase, $370M new loan production. Payoffs $200M in Q1, expected higher in Q2. Loan balances: ending loan balances dropped ~$50M, average loan balances up $174M linked quarter. Deposit balances increased $258M, non-interest bearing balances grew $126M to almost $4B (22.5% of total deposits). Loan yield 7.08%, interest-bearing deposit costs 2.35%, total deposit costs 1.83%

• Anticipates slightly higher payoffs in Q2, expects pipeline to replace balances. - Open to more M&A deals, especially if market conditions allow. - Continues stock repurchase program, expects impact on earnings once Mountain Commerce converted. - Cautious on long side due to economic uncertainties

• Economic uncertainties including war, inflation, interest rate fluctuations. - Potential credit risks with certain loans, although confident in resolving the $110M Texas credit. - Competitive pressures in loan and deposit markets

• Q: Talk about progress on acquiring more assets after Mountain Commerce, A: Conversations ongoing, hold tight to philosophy of not diluting shareholders, may do smaller deals if fits. - Q: Loan yields, A: Impact of non-accrual was about 5 basis points to loan yield, decline due to variable rate resets. - Q: Loan trend, A: Second quarter may feel soft, pipeline process more visibility on payoffs than new loans. - Q: Margin impact from Mountain Commerce deal, A: Expect little pressure initially, but additive to NII and EDS. - Q: Expenses, A: Core expenses around $115M, Mountain Commerce adds ~$7-7.5M a quarter until cost saves realized. - Q: Private credit outlook, A: Current bias towards further reduction, wait for credit market to stabilize for growth