Sell Rating on Home BancShares Reiterated

Sandler O'Neill Research has reiterated its Sell rating on Home BancShares Inc., citing a disclosure that an internal investigation by the company had uncovered apparent fraud at a subsidiary bank. The alleged fraud by a senior officer was estimated at approximately $2.1 million, but has apparently not resulted in customer losses, the research firm said. While noting that the bank's disclosure was hedged, Sandler O'Neill said the announcement "does not seem to be cause for significant concern." Pointing to Home Bancshares' decentralized system, with local management heading up the bank's subsidiaries, the research firm said it "would not be surprised to see management tighten its oversight of the subsidiary banks." Home BancShares, based in Conway, Ark., owns community banks in Arkansas and Florida.