BOK Financial Corporation

$BOKF - Nasdaq - Banks and Thrifts
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BOK Financial Reports Quarterly Earnings of $76 Million

Strong Diversified Fee Revenue Growth Drives Results

TULSA, Okla.--(BUSINESS WIRE)-- BOK Financial Corporation reported net income of $75.9 million or $1.10 per diluted share for the second quarter of 2014. Net income was $76.6 million or $1.11 per diluted share for the first quarter of 2014 and $79.9 million or $1.16 per diluted share for the second quarter of 2013.

Steven G. Bradshaw, President and Chief Executive Officer of BOK Financial Corporation, stated, “BOK Financial delivered improved results across the organization in the second quarter. Loan growth exceeded expectations, and each of our fee-generating businesses delivered very strong sequential revenue growth. The quarter’s results reflect the earnings power inherent in our diversified business model, as several lines of business grew this quarter, including energy lending, brokerage and trading, and mortgage banking. We are excited about the bank’s performance in the second quarter, and we believe our businesses are well-positioned for continued growth for the balance of 2014.”

Highlights of second quarter of 2014 included:

  • Net interest revenue totaled $166.1 million for the second quarter of 2014, up $3.5 million over the first quarter of 2014. Net interest margin was 2.75% for the second quarter of 2014 and 2.71% for the first quarter of 2014.
  • Fees and commissions revenue totaled $164.1 million for the second quarter of 2014, growing $23.2 million over the first quarter of 2014. Brokerage and trading, mortgage banking, fiduciary and asset management and transaction card revenues all experienced strong growth in the second quarter.
  • Operating expenses were $214.7 million for the second quarter, an increase of $29.6 million over the previous quarter. Personnel expense increased $19.3 million. The first quarter included a $17.2 million benefit from adjustments to accruals for incentive compensation of executive officers of the Company. Non-personnel expense increased $10.3 million.
  • No provision for credit losses was recorded in the second or first quarter of 2014. BOK Financial had net recoveries of $2.0 million for the second quarter of 2014 and $2.5 million in the previous quarter.
  • The combined allowance for credit losses totaled $192 million or 1.43% of outstanding loans at June 30, 2014 compared to $190 million or 1.45% of outstanding loans at March 31, 2014. Nonperforming assets that are not guaranteed by U.S. government agencies totaled $145 million or 1.09% of outstanding loans and repossessed assets (excluding those guaranteed by U.S. government agencies) at June 30, 2014 and $153 million or 1.18% of outstanding loans and repossessed assets (excluding those guaranteed by U.S. government agencies) at March 31, 2014.
  • Average loans increased by $317 million over the previous quarter due primarily to growth in commercial loans. Average commercial loans were up $295 million, average consumer loans grew by $19 million and average commercial real estate loans increased $18 million. Period-end outstanding loan balances were $13.4 billion at June 30, 2014, a $349 million increase over March 31, 2014. Commercial loan balances increased $316 million and commercial real estate loans increased $24 million.
  • Average deposits increased $262 million over the previous quarter. Growth in demand deposit balances was partially offset by a decrease in interest-bearing transaction accounts and time deposit balances. Period-end deposits were $20.6 billion at June 30, 2014, a $182 million increase over March 31, 2014, primarily due to growth in demand deposit balances.
  • The Company's Tier 1 common equity ratio, as defined by banking regulations, was 13.46% at June 30, 2014 and 13.59% at March 31, 2014. The Company and its subsidiary bank continue to exceed the regulatory definition of well capitalized. The Company's Tier 1 capital ratio was 13.63% at June 30, 2014 and 13.77% at March 31, 2014. Total capital ratio was 15.38% at June 30, 2014 and 15.55% at March 31, 2014. The Company's leverage ratio was 10.26% at June 30, 2014 and 10.17% at March 31, 2014.
  • The Company paid a regular quarterly cash dividend of $28 million or $0.40 per common share during the second quarter of 2014. On July 29, 2014, the board of directors approved a quarterly cash dividend of $0.40 per common share payable on or about August 29, 2014 to shareholders of record as of August 15, 2014.

Net Interest Revenue

Net interest revenue increased $3.5 million compared to the first quarter of 2014. Net interest margin was 2.75% for the second quarter of 2014, up 4 basis points over the first quarter of 2014.

The yield on average earning assets was 3.02%, an increase of 3 basis points over the prior quarter. The yield on the available for sale securities portfolio increased 5 basis points to 1.96%. Excess cash flows continue to be reinvested in short-duration securities that yield around 2%. The loan portfolio yield decreased 4 basis points from the previous quarter to 3.85% primarily due to continued market pricing pressure. Funding costs increased 1 basis point over the prior quarter to 0.42%.

Average earning assets increased $180 million during the second quarter of 2014. Growth in average loan balances of $317 million over the previous quarter was partially offset by a $276 million decrease in the available for sale securities portfolio. Cash flows received from payments on the securities portfolio funded loan growth or reduced short-term borrowings. The average balance of interest-bearing cash and cash equivalents, trading securities, restricted equity securities and residential mortgage loans held for sale all increased compared to the prior quarter. Average deposits increased $262 million and the average balance of borrowed funds decreased $49 million compared to the first quarter of 2014.

Steven Nell, Chief Financial Officer, added, "We remain on track with our plans to better position the balance sheet for a rising rate environment. Year-to-date, the amortized cost of our securities portfolio decreased by $599 million, while total loans have increased by $635 million. Our goal is to allow the securities portfolio to decrease by an additional $600 million by the end of 2014, replacing those securities with high-quality loans to commercial borrowers."

Fees and Commissions Revenue

Fees and commissions revenue totaled $164.1 million for the second quarter of 2014, an increase of $23.2 million over the first quarter of 2014.

Brokerage and trading revenue increased $9.5 million over the prior quarter. Securities trading revenue increased $3.5 million. Customer hedging revenue increased by $2.2 million primarily due to $1.6 million of recoveries received from the Lehman Brothers and MF Global bankruptcies during the second quarter. Investment banking had strong growth in the second quarter, increasing $3.0 million over the previous quarter. In addition, retail brokerage revenue was also up over the prior quarter.

Mortgage banking revenue totaled $29.3 million for the second quarter of 2014, an increase of $6.5 million over the first quarter of 2014. Revenue from mortgage loan production was up $6.3 million. Outstanding commitments to originate mortgage loans grew by $159 million over March 31 to $547 million at June 30. Residential mortgage loans funded for sale totaled $1.1 billion, an increase of $363 million over the previous quarter. Approximately 41% of loans originated in the second quarter were through correspondent channels, compared to 38% in the previous quarter. Origination from the recently added Home Direct mortgage origination channel was 7% of loans originated in the second quarter, unchanged from the prior quarter. Refinanced mortgage loans represented 25% of loans originated for sale in the second quarter of 2014 compared to 32% in the first quarter of 2014. Revenue from mortgage loan servicing grew by $211 thousand due to an increase in the volume of loans serviced.

Fiduciary and asset management revenue grew by $3.8 million over the first quarter of 2014. The acquisition of MBM Advisors in the second quarter and a full quarter of revenue from the acquisition of GTRUST Financial Corporation in the first quarter added approximately $1.5 million in fiduciary and asset management revenue over the first quarter of 2014. The remainder of the increase was primarily due to the seasonal timing of tax service fees and an increase in the fair value of assets managed.

Transaction card revenue increased $2.4 million over the prior quarter. Revenue increased from processing transactions on behalf of members of our TransFund electronic funds transfer network and from merchant services fees primarily due to growth in transaction volumes. Interchange fees paid on debit cards issued by the Company also increased over the prior quarter due to increased transaction volumes.

Operating Expenses

Total operating expenses were $214.7 million for the second quarter of 2014, an increase of $29.6 million over the first quarter of 2014.

Personnel costs were $19.3 million higher than the first quarter of 2014. The first quarter included a $17.2 million benefit from adjustments to accruals for incentive compensation of certain executive officers of the Company. Cash-based incentive compensation, which rewards employees as they generate business opportunities for the Company by growing loans, deposits, customer relationships or other measurable metrics, was up $4.3 million over the first quarter.

Non-personnel expense increased $10.3 million over the first quarter of 2014. Mortgage banking costs increased $4.3 million compared to the prior quarter. The Company finalized hold-back claims related to purchased mortgage loan servicing rights which reduced expenses by $1.3 million in the first quarter. Accruals for mortgage loan servicing costs were higher in the second quarter. Professional fees and services expense increased $3.5 million largely due to increased risk management and regulatory compliance costs. Data processing, net occupancy expense and business promotion expense all increased over the prior quarter. BOK Financial made a $2.4 million discretionary contribution of appreciated stock to the BOKF Foundation during the first quarter. This contribution also resulted in a $1.2 million reduction in income tax expense in the first quarter.

Loans, Deposits and Capital

Loans

Outstanding loans were $13.4 billion at June 30, 2014, an increase of $349 million over the previous quarter. Commercial, commercial real estate and consumer balances all grew over the prior quarter, partially offset by a decrease in residential mortgage loan balances.

Outstanding commercial loan balances increased $316 million or 4% over March 31, 2014. Service sector loans grew by $145 million over the prior quarter. Wholesale/retail sector loans were up $92 million and energy loans grew by $76 million over the prior quarter. Unfunded energy loan commitments increased by $171 million in the second quarter to $2.8 billion. All other unfunded commercial loan commitments totaled $3.7 billion at June 30, 2014, a decrease of $129 million compared to March 31, 2014.

Commercial real estate loans grew by $24 million or 1% over March 31, 2014 led by a $37 million increase in loan balances secured by industrial facilities. Loans secured by multifamily residential properties were up $15 million and other commercial real estate loan balances increased $12 million. Loans secured by office buildings decreased $42 million. Residential construction and land development loan balances were largely unchanged compared to March 31, 2014. Unfunded commercial real estate loan commitments totaled $603 million at June 30, 2014, an $80 million increase from March 31, 2014.

Dan Ellinor, Chief Operating Officer, added, “We continue to win in the competitive commercial lending market due to our reputation as a stable and reliable business partner for commercial borrowers. In the second quarter, energy, services, and wholesale/retail lending were our best performers with double-digit sequential loan growth, and Oklahoma was our fastest-growing market, contributing over 90% of total quarterly loan growth. The healthcare business, which generated strong growth for the past several quarters, was flat due to a significant number of borrowers moving to the permanent market late in the quarter. Our pipelines across the business remain healthy at present, and we expect low double-digit quarterly loan growth for the balance of the year.”

Deposits

Deposits totaled $20.6 billion at June 30, 2014, an increase of $182 million over March 31, 2014. Demand deposit balances grew by $436 million over the prior quarter. Interest-bearing transaction account balances decreased $201 million and time deposits decreased $46 million. Among the lines of business, commercial deposits increased $377 million, partially offset by a $76 million decrease in consumer deposits and a $95 million decrease in wealth management deposits. Growth in commercial deposit balances was primarily due to growth in balances attributed to energy and commercial & industrial customers during the second quarter.

Capital

The Company and its subsidiary bank exceeded the regulatory definition of well capitalized at June 30, 2014. The Company's Tier 1 capital ratio was 13.63% at June 30, 2014 and 13.77% at March 31, 2014. The total capital ratio was 15.38% at June 30, 2014 and 15.55% at March 31, 2014. In addition, the Company's tangible common equity ratio, a non-GAAP measure, was 10.20% at June 30, 2014 and 10.06% at March 31, 2014.

In July 2013, banking regulators issued the final rule revising regulatory capital rules for substantially all U.S. banking organizations. The new capital rule will be effective for BOK Financial on January 1, 2015. The new capital rule establishes a 7% threshold for the Tier 1 common equity ratio consisting of a minimum level plus a capital conservation buffer. The Company expects to exclude unrealized gains and losses from available for sale securities from its calculation of Tier 1 capital, consistent with the treatment under current capital rules. BOK Financial's Tier 1 common equity ratio based on the existing Basel I standards was 13.46% as of June 30, 2014. Based on our interpretation of the new capital rule, our estimated Tier 1 common equity ratio on a fully phased-in basis would be 12.35%, 535 basis points above the 7% regulatory threshold.

Credit Quality

Nonperforming assets totaled $255 million or 1.88% of outstanding loans and repossessed assets at June 30, 2014 compared to $256 million or 1.94% of outstanding loans and repossessed assets at March 31, 2014. Nonperforming assets that are not guaranteed by U.S. government agencies totaled $145 million or 1.09% of outstanding loans and repossessed assets (excluding those guaranteed by U.S. government agencies) at June 30, 2014 and $153 million or 1.18% at March 31, 2014, a decrease of $7.9 million.

Nonaccruing loans totaled $97 million or 0.72% of outstanding loans at June 30, 2014 compared to $105 million or 0.80% of outstanding loans at March 31, 2014. New nonaccruing loans identified in the second quarter totaled $14 million, offset by $13 million in payments received, $5.9 million in foreclosures and repossessions and $3.5 million in charge-offs. At June 30, 2014, nonaccruing commercial loans totaled $17 million or 0.20% of outstanding commercial loans, nonaccruing commercial real estate loans totaled $34 million or 1.30% of outstanding commercial real estate loans and nonaccruing residential mortgage loans totaled $44 million or 2.21% of outstanding residential mortgage loans.

BOK Financial had net recoveries of $2.0 million for the second quarter of 2014 and $2.5 million for the first quarter of 2014. Gross charge-offs totaled $3.5 million for the second quarter, compared to $2.8 million for the previous quarter. Recoveries totaled $5.5 million for the second quarter of 2014 and $5.4 million for the first quarter of 2014.

After evaluating all credit factors, the Company determined that no provision for credit losses was necessary during the second quarter of 2014. The combined allowance for credit losses totaled $192 million or 1.43% of outstanding loans and 199% of nonaccruing loans at June 30, 2014. The allowance for loan losses was $191 million and the accrual for off-balance sheet credit losses was $1.3 million.

Real estate and other repossessed assets totaled $100 million at June 30, 2014, primarily consisting of $65 million of 1-4 family residential properties (including $50 million guaranteed by U.S. government agencies), $17 million of developed commercial real estate properties, $12 million of undeveloped land and $6.1 million of residential land and land development properties.

Securities and Derivatives

The fair value of the available for sale securities portfolio totaled $9.7 billion at June 30, 2014 and $9.9 billion at March 31, 2014. At June 30, 2014, the available for sale portfolio consisted primarily of $7.3 billion of residential mortgage-backed securities fully backed by U.S. government agencies and $2.1 billion of commercial mortgage-backed securities fully backed by U.S. government agencies.

At June 30, 2014 the available for sale securities portfolio had a net unrealized gain of $85 million compared to a net unrealized gain of $15 million at March 31, 2014. Net unrealized gains on residential mortgage-backed securities issued by U.S. government agencies at June 30, 2014 increased $47 million during the second quarter to $85 million. Commercial mortgage-backed securities had a net unrealized loss of $14 million at June 30, 2014, compared to a net unrealized loss of $36 million at March 31, 2014.

In the second quarter of 2014, the Company recognized a minimal net gain from sales of $800 million of available for sale securities. Securities were sold either because they had reached their expected maximum potential return or to move into securities that will perform better in a rising rate environment. Net gains from sales of $531 million of available for sale securities in the first quarter of 2014 totaled $1.2 million.

The Company also maintains a portfolio of residential mortgage-backed securities issued by U.S. government agencies and interest rate derivative contracts designated as an economic hedge of the changes in the fair value of our mortgage servicing rights. Due to fluctuations in residential mortgage interest rates during the second quarter of 2014, the value of our mortgage servicing rights decreased by $6.4 million. The value of securities and interest rate derivative contracts held as an economic hedge increased by $4.9 million.

Conference Call and Webcast

The Company will hold a conference call at 9:00 a.m. central time on Wednesday, July 30, 2014 to discuss the financial results with investors. The live audio webcast and presentation slides will be available on the company’s website at www.bokf.com. The conference call can also be accessed by dialing 1-412-902-6611. A conference call and webcast replay will also be available shortly after conclusion of the live call at www.bokf.com or by dialing 1-412-317-0088 and referencing conference ID # 10049802.

About BOK Financial Corporation

BOK Financial is a $28 billion regional financial services company based in Tulsa, Oklahoma. The Company's stock is publicly traded on NASDAQ under the Global Select market listings (symbol: BOKF). BOK Financial's holdings include BOKF, NA, BOSC, Inc., The Milestone Group, Inc. and Cavanal Hill Investment Management, Inc. BOKF, NA operates the TransFund electronic funds network and seven banking divisions: Bank of Albuquerque, Bank of Arizona, Bank of Arkansas, Bank of Kansas City, Bank of Oklahoma, Bank of Texas and Colorado State Bank and Trust. Through its subsidiaries, the Company provides commercial and consumer banking, investment and trust services, mortgage origination and servicing, and an electronic funds transfer network. For more information, visit www.bokf.com.

The Company will continue to evaluate critical assumptions and estimates, such as the appropriateness of the allowance for credit losses and asset impairment as of June 30, 2014 through the date its financial statements are filed with the Securities and Exchange Commission and will adjust amounts reported if necessary.

This news release contains forward-looking statements that are based on management's beliefs, assumptions, current expectations, estimates and projections about BOK Financial, the financial services industry and the economy generally. Words such as “anticipates,” “believes,” “estimates,” “expects,” “forecasts,” “plans,” “projects,” variations of such words and similar expressions are intended to identify such forward-looking statements. Management judgments relating to and discussion of the provision and allowance for credit losses involve judgments as to future events and are inherently forward-looking statements. Assessments that BOK Financial's acquisitions and other growth endeavors will be profitable are necessary statements of belief as to the outcome of future events based in part on information provided by others which BOK Financial has not independently verified. These statements are not guarantees of future performance and involve certain risks, uncertainties, and assumptions which are difficult to predict with regard to timing, extent, likelihood and degree of occurrence. Therefore, actual results and outcomes may materially differ from what is expected, implied or forecasted in such forward-looking statements. Internal and external factors that might cause such a difference include, but are not limited to (1) the ability to fully realize expected cost savings from mergers within the expected time frames, (2) the ability of other companies on which BOK Financial relies to provide goods and services in a timely and accurate manner, (3) changes in interest rates and interest rate relationships, (4) demand for products and services, (5) the degree of competition by traditional and nontraditional competitors, (6) changes in banking regulations, tax laws, prices, levies and assessments, (7) the impact of technological advances and (8) trends in consumer behavior as well as their ability to repay loans. BOK Financial and its affiliates undertake no obligation to update, amend or clarify forward-looking statements, whether as a result of new information, future events, or otherwise.

 
BALANCE SHEETS -- UNAUDITED
BOK FINANCIAL CORPORATION

(In thousands)

 
    June 30,
2014
    March 31,
2014
    June 30,
2013
ASSETS
Cash and due from banks $ 615,479 $ 645,435 $ 507,551
Interest-bearing cash and cash equivalents 732,395 708,571 570,836
Trading securities 101,097 86,571 190,591
Investment securities 649,937 668,976 615,790
Available for sale securities 9,699,146 9,933,723 10,698,074
Fair value option securities 185,674 160,884 205,756
Restricted equity securities 91,213 85,643 157,847
Residential mortgage loans held for sale 325,875 226,512 301,057
Loans:
Commercial 8,367,661 8,051,706 7,708,120
Commercial real estate 2,654,978 2,631,407 2,317,096
Residential mortgage 2,008,215 2,018,675 2,039,785
Consumer       396,004         376,066         375,781  
Total loans 13,426,858 13,077,854 12,440,782
Allowance for loan losses       (190,690 )       (188,318 )       (203,124 )
Loans, net of allowance 13,236,168 12,889,536 12,237,658
Premises and equipment, net 280,286 279,257 271,191
Receivables 115,991 114,437 136,605
Goodwill 377,780 364,570 359,759
Intangible assets, net 36,576 31,561 26,242
Mortgage servicing rights 155,740 153,774 132,889
Real estate and other repossessed assets, net 100,111 95,515 110,112
Derivative contracts, net 357,680 218,507 546,206
Cash surrender value of bank-owned life insurance 289,231 286,932 280,047
Receivable on unsettled securities sales 14,025 18,199 182,147
Other assets       479,366         396,111         277,842  
TOTAL ASSETS     $ 27,843,770       $ 27,364,714       $ 27,808,200  
 
LIABILITIES AND EQUITY
Deposits:
Demand $ 7,908,005 $ 7,472,287 $ 7,145,323
Interest-bearing transaction 9,698,404 9,899,656 9,266,560
Savings 349,629 355,596 316,375
Time       2,615,826         2,662,174         2,767,972  
Total deposits 20,571,864 20,389,713 19,496,230
Funds purchased 705,573 1,166,178 747,165
Repurchase agreements 1,072,375 777,108 845,106
Other borrowings 1,231,662 1,031,693 2,481,644
Subordinated debentures 347,890 347,846 347,716
Accrued interest, taxes, and expense 100,227 160,351 175,677
Due on unsettled securities purchases 124,537 39,641 49,369
Derivative contracts, net 297,851 185,499 521,991
Other liabilities       144,145         122,086         150,420  
TOTAL LIABILITIES 24,596,124 24,220,115 24,815,318
Shareholders' equity:
Capital, surplus and retained earnings 3,163,101 3,103,130 2,938,623
Accumulated other comprehensive income       49,416         6,795         19,014  
TOTAL SHAREHOLDERS' EQUITY 3,212,517 3,109,925 2,957,637
Non-controlling interests       35,129         34,674         35,245  
TOTAL EQUITY       3,247,646         3,144,599         2,992,882  
TOTAL LIABILITIES AND EQUITY     $ 27,843,770       $ 27,364,714       $ 27,808,200  
 
 
AVERAGE BALANCE SHEETS -- UNAUDITED
BOK FINANCIAL CORPORATION

(in thousands)

 
  Three Months Ended
June 30,
2014
    March 31,
2014
    December 31,
2013
    September 30,
2013
    June 30,
2013
ASSETS
Interest-bearing cash and cash equivalents $ 635,140 $ 549,473 $ 559,918 $ 654,591 $ 408,224
Trading securities 116,186 92,409 127,011 124,689 181,866
Investment securities 658,793 671,756 672,722 621,104 610,940
Available for sale securities 9,800,934 10,076,942 10,434,810 10,558,677 11,060,700
Fair value option securities 164,684 165,515 167,490 169,299 216,312
Restricted equity securities 97,016 85,234 123,009 155,938 144,332
Residential mortgage loans held for sale 219,308 185,196 217,811 225,789 261,977
Loans:
Commercial 8,266,455 7,971,712 7,737,883 7,602,950 7,606,919
Commercial real estate 2,622,866 2,605,264 2,352,915 2,359,120 2,286,674
Residential mortgage 1,983,926 1,998,620 1,998,980 2,043,332 2,013,004
Consumer     391,214         372,330         371,798         396,694         370,847  
Total loans 13,264,461 12,947,926 12,461,576 12,402,096 12,277,444
Allowance for loan losses     (189,329 )       (186,979 )       (193,309 )       (201,616 )       (206,807 )
Total loans, net     13,075,132         12,760,947         12,268,267         12,200,480         12,070,637  
Total earning assets 24,767,193 24,587,472 24,571,038 24,710,567 24,954,988
Cash and due from banks 481,944 473,758 324,349 386,331 546,558
Derivative contracts, net 291,325 287,363 314,530 377,664 401,485
Cash surrender value of bank-owned life insurance 287,725 285,592 283,289 280,909 278,501
Receivable on unsettled securities sales 108,825 114,708 83,016 90,014 135,964
Other assets     1,549,809         1,489,875         1,526,566         1,409,247         1,341,828  
TOTAL ASSETS   $ 27,486,821       $ 27,238,768       $ 27,102,788       $ 27,254,732       $ 27,659,324  
 
LIABILITIES AND EQUITY
Deposits:
Demand $ 7,654,225 $ 7,312,076 $ 7,356,063 $ 7,110,079 $ 6,888,983
Interest-bearing transaction 9,850,991 9,900,823 9,486,136 9,276,136 9,504,128
Savings 355,459 336,576 323,123 317,912 315,421
Time     2,636,444         2,686,041         2,710,019         2,742,970         2,818,533  
Total deposits 20,497,119 20,235,516 19,875,341 19,447,097 19,527,065
Funds purchased 574,926 1,021,755 748,074 776,356 789,302
Repurchase agreements 914,892 773,127 752,286 799,175 819,373
Other borrowings 1,294,932 1,038,747 1,551,591 2,175,747 2,172,417
Subordinated debentures 347,868 347,824 347,781 347,737 347,695
Derivative contracts, net 243,619 258,729 294,315 330,819 334,877
Due on unsettled securities purchases 166,521 116,295 152,078 111,998 330,926
Other liabilities     270,220         341,701         327,519         300,880         310,015  
TOTAL LIABILITIES 24,310,097 24,133,694 24,048,985 24,289,809 24,631,670
Total equity     3,176,724         3,105,074         3,053,803         2,964,923         3,027,654  
TOTAL LIABILITIES AND EQUITY   $ 27,486,821       $ 27,238,768       $ 27,102,788       $ 27,254,732       $ 27,659,324  
 
 
STATEMENTS OF EARNINGS -- UNAUDITED
BOK FINANCIAL CORPORATION

(in thousands, except per share data)

 
    Three Months Ended       Six Months Ended
June 30, June 30,
2014     2013 2014     2013
 
Interest revenue $ 182,631 $ 186,777 $ 361,751 $ 376,823
Interest expense       16,534         17,885           33,012         36,479  
Net interest revenue 166,097 168,892 328,739 340,344
Provision for credit losses       —         —           —         (8,000 )
Net interest revenue after provision for credit losses       166,097         168,892           328,739         348,344  
Other operating revenue:
Brokerage and trading revenue 39,056 32,874 68,572 64,625
Transaction card revenue 31,510 29,942 60,644 57,633
Fiduciary and asset management revenue 29,543 24,803 55,265 47,116
Deposit service charges and fees 23,133 23,962 45,822 46,928
Mortgage banking revenue 29,330 36,596 52,174 76,572
Bank-owned life insurance 2,274 2,236 4,380 5,462
Other revenue       9,208         8,760           18,060         17,902  
Total fees and commissions 164,054 159,173 304,917 316,238
Loss on other assets, net (52 ) (1,666 ) (4,316 ) (1,199 )
Gain (loss) on derivatives, net 831 (2,527 ) 1,799 (3,468 )
Gain (loss) on fair value option securities, net 4,176 (9,156 ) 6,836 (12,327 )
Change in fair value of mortgage servicing rights (6,444 ) 14,315 (10,905 ) 16,973
Gain on available for sale securities, net 4 3,753 1,244 8,608
Total other-than-temporary impairment losses — (1,138 ) — (1,138 )
Portion of loss recognized in (reclassified from) other comprehensive income       —         586           —         339  
Net impairment losses recognized in earnings       —         (552 )         —         (799 )
Total other operating revenue 162,569 163,340 299,575 324,026
Other operating expense:
Personnel 123,714 128,110 228,147 253,765
Business promotion 7,150 5,770 12,991 11,223
Charitable contributions to BOKF Foundation — — 2,420 —
Professional fees and services 11,054 8,381 18,619 15,366
Net occupancy and equipment 18,789 16,909 35,685 33,390
Insurance 4,467 4,044 9,008 7,789
Data processing and communications 29,071 26,734 56,206 52,184
Printing, postage and supplies 3,429 3,580 6,970 7,254
Net losses and operating expenses of repossessed assets 1,118 282 2,550 1,528
Amortization of intangible assets 949 875 1,765 1,751
Mortgage banking costs 7,960 7,910 11,594 15,264
Other expense       7,006         8,326           13,856         15,390  
Total other operating expense 214,707 210,921 399,811 414,904
 
Net income before taxes 113,959 121,311 228,503 257,466
Federal and state income taxes       37,230         41,423           74,731         88,519  
 
Net income 76,729 79,888 153,772 168,947
Net income (loss) attributable to non-controlling interests       834         (43 )         1,287         1,052  
Net income attributable to BOK Financial Corporation shareholders     $ 75,895       $ 79,931         $ 152,485       $ 167,895  
 
Average shares outstanding:
Basic 68,359,945 67,993,822 68,318,689 67,904,599
Diluted 68,511,378 68,212,497 68,475,802 68,126,751
 
Net income per share:
Basic $ 1.10 $ 1.16 $ 2.21 $ 2.45
Diluted $ 1.10 $ 1.16 $ 2.20 $ 2.44
 
 
FINANCIAL HIGHLIGHTS -- UNAUDITED
BOK FINANCIAL CORPORATION

(in thousands, except ratio and share data)

 
    Three Months Ended
June 30,
2014
    March 31,
2014
    December 31,
2013
    September 30,
2013
    June 30,
2013
Capital:
Period-end shareholders' equity $ 3,212,517 $ 3,109,925 $ 3,020,049 $ 2,991,244 $ 2,957,637
Risk weighted assets $ 20,224,135 $ 19,720,418 $ 19,389,381 $ 19,366,620 $ 19,157,978
Risk-based capital ratios:
Tier 1 13.63 % 13.77 % 13.77 % 13.51 % 13.37 %
Total capital 15.38 % 15.55 % 15.56 % 15.35 % 15.28 %
Leverage ratio 10.26 % 10.17 % 10.05 % 9.80 % 9.43 %
Tangible common equity ratio1 10.20 % 10.06 % 9.90 % 9.73 % 9.38 %
Tier 1 common equity ratio 13.46 % 13.59 % 13.59 % 13.33 % 13.19 %
 
Common stock:
Book value per share $ 46.39 $ 45.00 $ 43.88 $ 43.49 $ 43.03
Market value per share:
High $ 70.66 $ 69.69 $ 66.32 $ 69.36 $ 65.95
Low $ 61.64 $ 62.34 $ 60.81 $ 62.93 $ 60.52
Cash dividends paid $ 27,706 $ 27,637 $ 27,523 $ 26,135 $ 26,118
Dividend payout ratio 36.51 % 36.08 % 37.72 % 34.51 % 32.68 %
Shares outstanding, net 69,256,958 69,111,167 68,829,450 68,787,584 68,739,208
 
Performance ratios (quarter annualized):
Return on average assets 1.11 % 1.14 % 1.07 % 1.10 % 1.16 %
Return on average equity 9.58 % 10.00 % 9.48 % 10.13 % 10.59 %
Net interest margin 2.75 % 2.71 % 2.74 % 2.75 % 2.80 %
Efficiency ratio 63.62 % 59.69 % 68.50 % 66.03 % 63.11 %
 
Reconciliation of non-GAAP measures:

1   Tangible common equity ratio:

Total shareholders' equity $ 3,212,517 $ 3,109,925 $ 3,020,049 $ 2,991,244 $ 2,957,637
Less: Goodwill and intangible assets, net       (414,356 )       (396,131 )       (384,323 )       (385,166 )       (386,001 )
Tangible common equity     $ 2,798,161       $ 2,713,794       $ 2,635,726       $ 2,606,078       $ 2,571,636  
 
Total assets $ 27,843,770 $ 27,364,714 $ 27,015,432 $ 27,166,367 $ 27,808,200
Less: Goodwill and intangible assets, net       (414,356 )       (396,131 )       (384,323 )       (385,166 )       (386,001 )
Tangible assets     $ 27,429,414       $ 26,968,583       $ 26,631,109       $ 26,781,201       $ 27,422,199  
 
Tangible common equity ratio       10.20 %       10.06 %       9.90 %       9.73 %       9.38 %
 
Other data:
Fiduciary assets $ 32,716,648 $ 31,296,565 $ 30,137,092 $ 29,593,140 $ 28,280,214
Mortgage servicing portfolio $ 14,626,291 $ 14,045,642 $ 13,718,942 $ 13,298,479 $ 12,741,651
Mortgage commitments $ 546,864 $ 387,755 $ 258,873 $ 351,196 $ 547,508
Mortgage loans funded for sale $ 1,090,629 $ 727,516 $ 848,870 $ 1,080,167 $ 1,196,038
Mortgage loan refinances to total fundings 25 % 32 % 29 % 30 % 48 %
Tax equivalent adjustment $ 2,803 $ 2,551 $ 2,467 $ 2,565 $ 2,647
Net unrealized gain (loss) on available for sale securities $ 85,480 $ 15,446 $ (37,929 ) $ 7,425 $ 42,233
 
Gain (loss) on mortgage servicing rights, net of economic hedge:
Gain (loss) on mortgage hedge derivative contracts, net $ 831 $ 968 $ (931 ) $ 31 $ (2,526 )
Gain (loss) on fair value option securities, net       4,074         2,585         (3,013 )       (89 )       (9,102 )
Gain (loss) on economic hedge of mortgage servicing rights 4,905 3,553 (3,944 ) (58 ) (11,628 )
Gain (loss) on changes in fair value of mortgage servicing rights       (6,444 )       (4,461 )       6,093         (346 )       14,315  
Gain (loss) on changes in fair value of mortgage servicing rights, net of economic hedges     $ (1,539 )     $ (908 )     $ 2,149       $ (404 )     $ 2,687  
 
Net interest revenue on fair value option securities     $ 721       $ 790       $ 811       $ 741       $ 910  
 
 
QUARTERLY EARNINGS TREND -- UNAUDITED
BOK FINANCIAL CORPORATION

(in thousands, except ratio and per share data)

 
    Three Months Ended
June 30,
2014
    March 31,
2014
    December 31,
2013
    September 30,
2013
    June 30,
2013
 
Interest revenue $ 182,631 $ 179,120 $ 183,120 $ 185,428 $ 186,777
Interest expense       16,534         16,478         16,876         17,539         17,885  
Net interest revenue 166,097 162,642 166,244 167,889 168,892
Provision for credit losses       —         —         (11,400 )       (8,500 )       —  
Net interest revenue after provision for credit losses 166,097 162,642 177,644 176,389 168,892
Other operating revenue:
Brokerage and trading revenue 39,056 29,516 28,515 32,338 32,874
Transaction card revenue 31,510 29,134 29,134 30,055 29,942
Fiduciary and asset management revenue 29,543 25,722 25,074 23,892 24,803
Deposit service charges and fees 23,133 22,689 23,440 24,742 23,962
Mortgage banking revenue 29,330 22,844 21,876 23,486 36,596
Bank-owned life insurance 2,274 2,106 2,285 2,408 2,236
Other revenue       9,208         8,852         12,048         8,314         8,760  
Total fees and commissions 164,054 140,863 142,372 145,235 159,173
Gain (loss) on other assets, net (52 ) (4,264 ) 651 (377 ) (1,666 )
Gain (loss) on derivatives, net 831 968 (930 ) 31 (2,527 )
Gain (loss) on fair value option securities, net 4,176 2,660 (2,805 ) (80 ) (9,156 )
Change in fair value of mortgage servicing rights (6,444 ) (4,461 ) 6,093 (346 ) 14,315
Gain on available for sale securities, net 4 1,240 1,634 478 3,753
Total other-than-temporary impairment losses — — — (1,436 ) (1,138 )
Portion of loss recognized in (reclassified from) other comprehensive income       —         —         —         (73 )       586  
Net impairment losses recognized in earnings       —         —         —         (1,509 )       (552 )
Total other operating revenue 162,569 137,006 147,015 143,432 163,340
Other operating expense:
Personnel 123,714 104,433 125,662 125,799 128,110
Business promotion 7,150 5,841 6,020 5,355 5,770
Charitable contributions to BOKF Foundation — 2,420 — 2,062 —
Professional fees and services 11,054 7,565 10,003 7,183 8,381
Net occupancy and equipment 18,789 16,896 19,103 17,280 16,909
Insurance 4,467 4,541 4,394 3,939 4,044
Data processing and communications 29,071 27,135 28,196 25,695 26,734
Printing, postage and supplies 3,429 3,541 3,126 3,505 3,580
Net losses and operating expenses of repossessed assets 1,118 1,432 1,618 2,014 282
Amortization of intangible assets 949 816 842 835 875
Mortgage banking costs 7,960 3,634 7,071 8,753 7,910
Other expense       7,006         6,850         9,384         7,878         8,326  
Total other operating expense 214,707 185,104 215,419 210,298 210,921
Net income before taxes 113,959 114,544 109,240 109,523 121,311
Federal and state income taxes       37,230         37,501         35,318         33,461         41,423  
Net income 76,729 77,043 73,922 76,062 79,888
Net income (loss) attributable to non-controlling interests       834         453         946         324         (43 )
Net income attributable to BOK Financial Corporation shareholders     $ 75,895       $ 76,590       $ 72,976       $ 75,738       $ 79,931  
 
Average shares outstanding:
Basic $ 1.10 $ 1.11 $ 1.06 $ 1.10 $ 1.16
Diluted $ 1.10 $ 1.11 $ 1.06 $ 1.10 $ 1.16
Net income per share:
Basic 68,359,945 68,273,685 68,095,254 68,049,179 67,993,822
Diluted 68,511,378 68,436,478 68,293,758 68,272,861 68,212,497
 
 
LOANS TREND -- UNAUDITED
BOK FINANCIAL CORPORATION

(In thousands)

 
    June 30,
2014
    March 31,
2014
    December 31,
2013
    September 30,
2013
    June 30,
2013
Commercial:
Energy $ 2,419,788 $ 2,344,072 $ 2,351,760 $ 2,311,991 $ 2,384,746
Services 2,377,065 2,232,471 2,282,210 2,148,551 2,204,253
Wholesale/retail 1,318,151 1,225,990 1,201,364 1,181,806 1,175,543
Manufacturing 452,866 444,215 391,751 382,460 386,133
Healthcare 1,394,156 1,396,562 1,274,246 1,160,212 1,118,810
Other commercial and industrial       405,635       408,396       441,890       386,055       438,635
Total commercial       8,367,661       8,051,706       7,943,221       7,571,075       7,708,120
 
Commercial real estate:
Residential construction and land development 184,779 184,820 206,258 216,456 225,654
Retail 642,110 640,506 586,047 556,918 553,412
Office 394,217 436,264 411,499 422,043 459,558
Multifamily 677,403 662,674 576,502 520,454 500,452
Industrial 342,080 305,207 243,877 245,022 253,990
Other commercial real estate       414,389       401,936       391,170       388,336       324,030
Total commercial real estate       2,654,978       2,631,407       2,415,353       2,349,229       2,317,096
 
Residential mortgage:
Permanent mortgage 1,020,928 1,033,572 1,062,744 1,078,661 1,095,871
Permanent mortgages guaranteed by U.S. government agencies 188,087 184,822 181,598 163,919 156,887
Home equity       799,200       800,281       807,684       792,185       787,027
Total residential mortgage       2,008,215       2,018,675       2,052,026       2,034,765       2,039,785
 
Consumer       396,004       376,066       381,664       395,031       375,781
 
Total     $ 13,426,858     $ 13,077,854     $ 12,792,264     $ 12,350,100     $ 12,440,782
 
 
LOANS BY PRINCIPAL MARKET AREA -- UNAUDITED
BOK FINANCIAL CORPORATION

(in thousands)

 
    June 30,
2014
    March 31,
2014
    December 31,
2013
    September 30,
2013
    June 30,
2013
 
Bank of Oklahoma:
Commercial $ 3,101,513 $ 2,782,997 $ 2,902,140 $ 2,801,979 $ 2,993,247
Commercial real estate 598,790 593,282 602,010 564,141 569,780
Residential mortgage 1,490,171 1,505,702 1,524,212 1,497,027 1,503,457
Consumer       187,914       179,733       192,283       207,360       211,744
Total Bank of Oklahoma       5,378,388       5,061,714       5,220,645       5,070,507       5,278,228
 
Bank of Texas:
Commercial 3,107,808 3,161,203 3,052,274 2,858,970 2,849,888
Commercial real estate 995,182 969,804 816,574 853,857 813,659
Residential mortgage 251,290 256,332 260,544 263,945 263,916
Consumer       147,322       136,782       131,297       129,144       105,390
Total Bank of Texas       4,501,602       4,524,121       4,260,689       4,105,916       4,032,853
 
Bank of Albuquerque:
Commercial 381,843 351,454 342,336 325,542 296,036
Commercial real estate 309,421 305,080 308,829 306,914 314,871
Residential mortgage 137,110 131,932 133,900 131,756 133,058
Consumer       12,346       12,972       13,842       14,583       14,364
Total Bank of Albuquerque       840,720       801,438       798,907       778,795       758,329
 
Bank of Arkansas:
Commercial 71,859 73,804 81,556 73,063 61,414
Commercial real estate 85,633 81,181 78,264 84,364 85,546
Residential mortgage 8,334 7,898 7,922 10,466 10,691
Consumer       6,323       6,881       8,023       9,426       11,819
Total Bank of Arkansas       172,149       169,764       175,765       177,319       169,470
 
Colorado State Bank & Trust:
Commercial 856,323 825,315 735,626 748,331 786,262
Commercial real estate 200,995 213,850 190,355 158,320 146,137
Residential mortgage 60,360 57,345 62,821 66,475 62,490
Consumer       23,330       22,095       22,686       22,592       23,148
Total Colorado State Bank & Trust       1,141,008       1,118,605       1,011,488       995,718       1,018,037
 
Bank of Arizona:
Commercial 446,814 453,799 417,702 379,817 355,698
Commercial real estate 292,799 301,266 257,477 250,129 258,938
Residential mortgage 41,059 42,899 47,111 49,109 51,774
Consumer       7,821       7,145       7,887       7,059       4,947
Total Bank of Arizona       788,493       805,109       730,177       686,114       671,357
 
Bank of Kansas City:
Commercial 401,501 403,134 411,587 383,373 365,575
Commercial real estate 172,158 166,944 161,844 131,504 128,165
Residential mortgage 19,891 16,567 15,516 15,987 14,399
Consumer       10,948       10,458       5,646       4,867       4,369
Total Bank of Kansas City       604,498       597,103       594,593       535,731       512,508
 
TOTAL BOK FINANCIAL     $ 13,426,858     $ 13,077,854     $ 12,792,264     $ 12,350,100     $ 12,440,782
 

Loans attributed to a geographical region may not always represent the location of the borrower or the collateral.

 
DEPOSITS BY PRINCIPAL MARKET AREA -- UNAUDITED
BOK FINANCIAL CORPORATION

(in thousands)

 
    June 30,
2014
    March 31,
2014
    December 31,
2013
    September 30,
2013
    June 30,
2013
Bank of Oklahoma:
Demand $ 3,785,922 $ 3,476,876 $ 3,432,940 $ 3,442,831 $ 3,552,328
Interest-bearing:
Transaction 5,997,474 6,148,712 6,318,045 5,565,462 5,644,959
Savings 210,330 211,770 191,880 189,186 185,345
Time       1,195,586       1,209,002       1,214,507       1,197,617       1,179,869
Total interest-bearing       7,403,390       7,569,484       7,724,432       6,952,265       7,010,173
Total Bank of Oklahoma       11,189,312       11,046,360       11,157,372       10,395,096       10,562,501
 
Bank of Texas:
Demand 2,617,194 2,513,729 2,481,603 2,498,668 2,299,632
Interest-bearing:
Transaction 1,957,236 1,967,107 1,966,580 1,853,586 1,931,758
Savings 67,012 70,890 64,632 63,368 63,745
Time       606,248       621,925       638,465       667,873       692,888
Total interest-bearing       2,630,496       2,659,922       2,669,677       2,584,827       2,688,391
Total Bank of Texas       5,247,690       5,173,651       5,151,280       5,083,495       4,988,023
 
Bank of Albuquerque:
Demand 515,554 524,191 502,395 491,894 455,580
Interest-bearing:
Transaction 489,378 516,734 529,140 541,565 525,481
Savings 36,442 37,481 33,944 34,003 34,096
Time       309,540       320,352       327,281       334,946       346,506
Total interest-bearing       835,360       874,567       890,365       910,514       906,083
Total Bank of Albuquerque       1,350,914       1,398,758       1,392,760       1,402,408       1,361,663
 
Bank of Arkansas:
Demand 44,471 40,026 38,566 33,378 31,778
Interest-bearing:
Transaction 205,216 212,144 144,018 205,891 187,223
Savings 2,287 2,264 1,986 1,919 1,974
Time       41,155       32,312       32,949       35,184       37,272
Total interest-bearing       248,658       246,720       178,953       242,994       226,469
Total Bank of Arkansas       293,129       286,746       217,519       276,372       258,247
 
Colorado State Bank & Trust:
Demand 396,185 399,820 409,942 375,060 367,407
Interest-bearing:
Transaction 566,320 536,438 541,675 536,734 519,584
Savings 29,234 28,973 26,880 27,782 27,948
Time       385,252       399,948       407,088       424,225       451,168
Total interest-bearing       980,806       965,359       975,643       988,741       998,700
Total Colorado State Bank & Trust       1,376,991       1,365,179       1,385,585       1,363,801       1,366,107

 

 

 

 

 

Bank of Arizona:
Demand 293,836 265,149 204,092 188,365 186,382
Interest-bearing:
Transaction 379,170 409,200 364,736 339,158 376,305
Savings 2,813 2,711 2,432 2,511 2,238
Time       37,666       37,989       34,391       36,285       35,490
Total interest-bearing       419,649       449,900       401,559       377,954       414,033
Total Bank of Arizona       713,485       715,049       605,651       566,319       600,415
 
Bank of Kansas City:
Demand 254,843 252,496 246,739 301,780 252,216
Interest-bearing:
Transaction 103,610 109,321 69,857 77,414 81,250
Savings 1,511 1,507 1,252 1,080 1,029
Time       40,379       40,646       41,312       23,890       24,779
Total interest-bearing       145,500       151,474       112,421       102,384       107,058
Total Bank of Kansas City       400,343       403,970       359,160       404,164       359,274
 
TOTAL BOK FINANCIAL     $ 20,571,864     $ 20,389,713     $ 20,269,327     $ 19,491,655     $ 19,496,230
 
 
NET INTEREST MARGIN TREND -- UNAUDITED
BOK FINANCIAL CORPORATION
 
    Three Months Ended
June 30,
2014
    March 31,
2014
    December 31,
2013
    September 30,
2013
    June 30,
2013
 
TAX-EQUIVALENT ASSETS YIELDS
Interest-bearing cash and cash equivalents 0.24 % 0.20 % 0.18 % 0.22 % 0.27 %
Trading securities 2.40 % 2.85 % 1.73 % 2.25 % 2.40 %
Investment securities:
Taxable 5.64 % 5.64 % 5.75 % 5.78 % 5.88 %
Tax-exempt     1.63 %     1.67 %     1.66 %     1.60 %     1.88 %
Total investment securities     3.01 %     3.04 %     3.12 %     3.22 %     3.58 %
Available for sale securities:
Taxable 1.94 % 1.90 % 1.89 % 1.92 % 1.94 %
Tax-exempt     4.44 %     3.11 %     2.74 %     2.81 %     3.59 %
Total available for sale securities     1.96 %     1.91 %     1.89 %     1.93 %     1.96 %
Fair value option securities 1.94 % 1.99 % 2.06 % 1.80 % 1.92 %
Restricted equity securities 5.26 % 4.68 % 5.06 % 3.05 % 4.05 %
Residential mortgage loans held for sale 4.63 % 3.46 % 4.16 % 3.87 % 3.54 %
Loans 3.85 % 3.89 % 4.01 % 4.06 % 4.12 %
Allowance for loan losses                              
Loans, net of allowance 3.91 % 3.95 % 4.07 % 4.13 % 4.19 %
Total tax-equivalent yield on earning assets 3.02 % 2.99 % 3.02 % 3.03 % 3.10 %
 
COST OF INTEREST-BEARING LIABILITIES
Interest-bearing deposits:
Interest-bearing transaction 0.10 % 0.10 % 0.11 % 0.11 % 0.12 %
Savings 0.12 % 0.12 % 0.12 % 0.13 % 0.15 %
Time     1.55 %     1.56 %     1.55 %     1.55 %     1.57 %
Total interest-bearing deposits 0.40 % 0.41 % 0.42 % 0.43 % 0.44 %
Funds purchased 0.07 % 0.06 % 0.08 % 0.07 % 0.10 %
Repurchase agreements 0.08 % 0.08 % 0.06 % 0.06 % 0.06 %
Other borrowings 0.40 % 0.40 % 0.31 % 0.28 % 0.27 %
Subordinated debt     2.52 %     2.52 %     2.48 %     2.52 %     2.54 %
Total cost of interest-bearing liabilities     0.42 %     0.41 %     0.42 %     0.42 %     0.43 %
Tax-equivalent net interest revenue spread 2.60 % 2.58 % 2.60 % 2.61 % 2.67 %
Effect of noninterest-bearing funding sources and other     0.15 %     0.13 %     0.14 %     0.14 %     0.13 %
Tax-equivalent net interest margin     2.75 %     2.71 %     2.74 %     2.75 %     2.80 %
 

Yield calculations are shown on a tax equivalent basis at the statutory federal and state rates for the periods presented. The yield calculations exclude security trades that have been recorded on trade date with no corresponding interest income and the unrealized gains and losses. The yield calculation also includes average loan balances for which the accrual of interest has been discontinued and are net of unearned income.

 
CREDIT QUALITY INDICATORS
BOK FINANCIAL CORPORATION

(in thousands, except ratios)

 
    Three Months Ended
June 30,
2014
    March 31,
2014
    December 31,
2013
    September 30,
2013
    June 30,
2013
Nonperforming assets:
Nonaccruing loans:
Commercial $ 17,103 $ 19,047 $ 16,760 $ 19,522 $ 20,869
Commercial real estate 34,472 39,305 40,850 52,502 58,693
Residential mortgage 44,340 45,380 42,320 39,256 40,534
Consumer       765         974         1,219         1,624         2,037  
Total nonaccruing loans 96,680 104,706 101,149 112,904 122,133
Accruing renegotiated loans guaranteed by U.S. government agencies 57,818 55,507 54,322 50,099 48,733
Real estate and other repossessed assets:
Guaranteed by U.S. government agencies 49,720 45,638 37,431 37,906 32,155
Other       50,391         49,877         54,841         70,216         77,957  
Total real estate and other repossessed assets       100,111         95,515         92,272         108,122         110,112  
Total nonperforming assets     $ 254,609       $ 255,728       $ 247,743       $ 271,125       $ 280,978  
Total nonperforming assets excluding those guaranteed by U.S. government agencies     $ 145,124       $ 153,011       $ 155,213       $ 182,543       $ 200,007  
 
Nonaccruing loans by loan portfolio sector:
Commercial:
Energy $ 1,619 $ 1,759 $ 1,860 $ 1,953 $ 2,277
Services 3,669 4,581 4,922 6,927 7,448
Wholesale / retail 5,885 6,854 6,969 7,223 6,700
Manufacturing 3,507 3,565 592 843 876
Healthcare 1,422 1,443 1,586 1,733 2,670
Other commercial and industrial       1,001         845         831         843         898  
Total commercial       17,103         19,047         16,760         19,522         20,869  
Commercial real estate:
Residential construction and land development 15,146 16,547 17,377 20,784 21,135
Retail 4,199 4,626 4,857 7,914 8,406
Office 3,591 6,301 6,391 6,838 7,828
Multifamily — — 7 4,350 6,447
Industrial 631 886 252 — —
Other commercial real estate       10,905         10,945         11,966         12,616         14,877  
Total commercial real estate       34,472         39,305         40,850         52,502         58,693  
Residential mortgage:
Permanent mortgage 32,952 36,342 34,279 31,797 32,747
Permanent mortgage guaranteed by U.S. government agencies 1,947 1,572 777 577 83
Home equity       9,441         7,466         7,264         6,882         7,704  
Total residential mortgage       44,340         45,380         42,320         39,256         40,534  
Consumer       765         974         1,219         1,624         2,037  
Total nonaccruing loans     $ 96,680       $ 104,706       $ 101,149       $ 112,904       $ 122,133  
 
Performing loans 90 days past due1 $ 67 $ 1,991 $ 1,415 $ 188 $ 2,460
 
Gross charge-offs $ (3,522 ) $ (2,848 ) $ (3,113 ) $ (4,708 ) $ (8,552 )
Recoveries       5,524         5,360         6,068         4,409         6,210  
Net recoveries (charge-offs)     $ 2,002       $ 2,512       $ 2,955       $ (299 )     $ (2,342 )
 
Provision for credit losses $ — $ — $ (11,400 ) $ (8,500 ) $ —
 
Allowance for loan losses to period end loans 1.42 % 1.44 % 1.45 % 1.57 % 1.63 %
Combined allowance for credit losses to period end loans 1.43 % 1.45 % 1.47 % 1.59 % 1.65 %
Nonperforming assets to period end loans and repossessed assets 1.88 % 1.94 % 1.92 % 2.18 % 2.24 %
Net charge-offs (annualized) to average loans (0.06 )% (0.08 )% (0.09 )% 0.01 % 0.08 %
Allowance for loan losses to nonaccruing loans 197.24 % 179.86 % 183.29 % 172.12 % 166.31 %
Combined allowance for credit losses to nonaccruing loans 198.59 % 181.46 % 185.35 % 173.54 % 167.63 %
 
1 Excludes residential mortgage loans guaranteed by agencies of the U.S. government.

BOK Financial Corporation

Joseph Crivelli, 918-595-3027

Investor Relations

or

Andrea Myers, 918-594-7794

Corporate Communications

Source: BOK Financial Corporation

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