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CST: 12/12/2019 18:52:05   

BOK Financial Reports Quarterly Earnings of $111 million or $1.54 Per Share

232 Days ago

TULSA, Okla., April 24, 2019 (GLOBE NEWSWIRE) --

CEO Commentary

Steven G. Bradshaw, president and chief executive officer, stated, “The first quarter was a great start to the year for BOK Financial, with continued growth in our loan portfolio led by our specialty lines of business, and re-energized activity in our brokerage and trading and mortgage businesses. These drivers, combined with diligent expense management, helped us maintain the growth trend established with our record year in 2018. The economy across the BOK Financial footprint is strong and the credit environment remains benign with no trouble spots on the horizon. We are optimistic about prospects for continued earnings growth through the remainder of 2019.”

Bradshaw added, "We are proud to have completed the last steps of the CoBiz systems integration this quarter and look forward to the cost savings and revenue growth envisioned when we announced the deal a mere ten months ago. As I've said previously, I believe the combination of CoBiz and BOK Financial creates the premier commercial bank in Colorado and Arizona and I look forward to our success in these markets for the balance of 2019 and beyond."

First Quarter 2019 Financial Highlights

  • Net income was $110.6 million or $1.54 per diluted share for the first quarter of 2019 and $108.5 million and $1.50 per diluted share for the fourth quarter of 2018. The first quarter included a 13 cent per share reduction as a result of CoBiz integration costs and the fourth quarter included a 15 cent per share reduction.
     
  • Net interest revenue totaled $278.1 million, a decrease of $7.6 million. Net interest margin decreased to 3.30 percent from 3.40 percent.
     
  • Fees and commissions revenue totaled $160.6 million, consistent with the fourth quarter of 2018.
     
  • Operating expense was relatively consistent at $287.2 million. The first quarter of 2019 included $12.7 million of integration costs, while the fourth quarter of 2018 included $14.5 million.
     
  • An $8.0 million provision for credit losses was recorded in the first quarter of 2019. The combined allowance for credit losses totaled $207 million or 0.95 percent of outstanding loans compared to $209 million or 0.97 percent in the previous quarter.
     
  • Average loans increased $187 million and period-end loans increased $102 million to $21.8 billion.
     
  • The Company repurchased 705,609 shares at an average price of $85.85 per share.

First Quarter 2019 Business Segment Highlights

Commercial Banking

  • Contributed $86.1 million to net income, an increase of $1.6 million over the prior quarter. Net interest revenue increased by $3.3 million to $151.6 million. This was partially offset by decreased fee revenue.

    Operating expenses decreased $1.5 million, split relatively evenly between personnel and non-personnel expenses.
  • Average loans grew $364 million to $16.0 billion.

Consumer Banking

  • Contributed $15.6 million to net income, an increase of $12.8 million compared to the fourth quarter. Net interest revenue increased $9.7 million. Operating expense decreased $2.6 million.

  • Implemented the strategic decision to exit our online lead buying business, HomeDirect, to focus on our in-house channel that provides higher margins and allows us to build long-term client relationships.

Wealth Management

  • Contributed $23.7 million to net income, an increase of $6.2 million compared to the prior quarter. Fees and commission revenue increased $5.6 million largely due to an increase in brokerage and trading revenue.

  • Assets under management or administration were $78.9 billion at March 31, 2019 compared to $76.3 billion at December 31, 2018. Fiduciary assets totaled $46.4 billion at March 31, 2019 and $44.8 billion at December 31, 2018.

Net Interest Revenue

Net interest revenue was $278.1 million for the first quarter of 2019, a $7.6 million decrease compared to the fourth quarter of 2018. Net interest margin was 3.30 percent for the first quarter of 2019, down 10 basis points compared to the previous quarter. A decrease in average non-interest bearing demand deposits and an increase in average trading securities and related receivables combined to decrease net interest revenue and to compress the net interest margin.

The decrease in non-interest bearing demand deposits appears to have been driven primarily by seasonal factors along with commercial customers putting their cash to use.

Due to the nature of the trading activity, much of the revenue associated with average trading assets is recognized as brokerage and trading revenue, rather than interest income, while all of the related funding costs remain in interest expense.

The yield on average earning assets was 4.46 percent, a 13 basis point increase. The yield on the loan portfolio was 5.26 percent, up 17 basis points primarily due to increases in short-term market interest rates. The yield on the available for sale securities portfolio increased 6 basis points to 2.57 percent. The yield on the trading securities portfolio was down 22 basis points.

Funding costs were 1.66 percent, up 24 basis points. The cost of interest-bearing deposits increased 17 basis points to 1.04 percent. The cost of other borrowed funds was up 21 basis points to 2.54 percent. The benefit to net interest margin from assets funded by non-interest liabilities was relatively unchanged at 50 basis points.

Average earning assets increased $675 million compared to the fourth quarter of 2018. Average loan balances were up $187 million. Available for sale securities increased $178 million. Fair value option securities balances increased $317 million. Trading securities balances increased $39 million. Average borrowed funds increased $1.5 billion and average interest-bearing deposit balances increased $180 million compared to the fourth quarter of 2018. In addition, receivables from unsettled securities sales, primarily related to our U.S. agency residential mortgage back trading operations, were up $425 million. Growth in these non-interest bearing receivables was funded by increased borrowings.

Fees and Commissions Revenue

Fees and commissions revenue totaled $160.6 million for the first quarter of 2019, consistent with the fourth quarter of 2018.

Brokerage and trading revenue increased $3.5 million due to increased trading volumes. Lower mortgage interest rates have led to an increase in mortgage applications, which has positively affected mortgage banking revenue. Mortgage banking revenue increased $2.0 million over the fourth quarter of 2018. Mortgage gain on sale margins increased 18 basis points.

Other revenue decreased $3.6 million, primarily due to a decrease in revenue earned on certain repossessed assets compared to the fourth quarter of 2018. In addition, service charges were reduced by $1.2 million, primarily due to two less days in the quarter compared to the fourth quarter of 2018.

Operating Expense

Total operating expense was $287.2 million for the first quarter of 2019, relatively consistent with the fourth quarter of 2018. CoBiz integration costs were $12.7 million in the first quarter of 2019 compared to $14.5 million in the fourth quarter of 2018. The following discussion excludes the impact of these costs.

Personnel expense increased $10.9 million. Personnel expenses related to CoBiz operations decreased $2.0 million compared to the prior quarter. Incentive compensation expense increased $9.6 million mainly due to changes in vesting assumptions related to the Company's earnings per share growth relative to a defined peer group. Employee benefits increased $1.9 million due to a seasonal increase in payroll taxes partially offset by a decrease in health care costs.

Non-personnel expense decreased $6.6 million. The fourth quarter of 2018 included a $2.8 million charitable donation to the BOKF Foundation. In addition, business promotion expense decreased $1.7 million and mortgage banking costs decreased $1.6 million, both due to seasonality. Professional fees and services decreased $1.0 million. These decreases were partially offset by an increase in data processing and communications expense of $3.0 million.

Loans, Deposits and Capital

Loans

Outstanding loans were $21.8 billion at March 31, 2019, up $102 million over December 31, 2018. Growth in outstanding commercial loan balances was partially offset by a decrease in commercial real estate loans.Loans

Outstanding commercial loan balances grew by $326 million or 2 percent over December 31, 2018. Energy loan balances were up $115 million, consistent with our ongoing support and commitment to the oil and gas industry. Healthcare sector loans increased by $117 million and wholesale/retail sector loans increased $86 million. This growth was partially offset by a $31 million decrease in other commercial and industrial loans.

Commercial real estate loan balances decreased $164 million or 3 percent compared to December 31, 2018 due to a cycle of pay-downs; however, commitment volume remains strong. Loans secured by multifamily residential properties decreased $78 million. Loans secured by office buildings decreased $40 million and loans secured by retail facilities decreased $28 million.

Deposits

Period-end deposits totaled $25.3 billion at March 31, 2019, a $68 million increase compared to December 31, 2018. Demand deposit balances decreased $318 million. Interest-bearing transaction account balances increased $270 million. Time deposit balances increased by $85 million.

Capital

The company's common equity Tier 1 capital ratio was 10.71 percent at March 31, 2019. In addition, the company's Tier 1 capital ratio was 10.71 percent, total capital ratio was 12.24 percent, and leverage ratio was 8.76 percent at March 31, 2019. At December 31, 2018, the company's common equity Tier 1 capital ratio was 10.92 percent, Tier 1 capital ratio was 10.92 percent, total capital ratio was 12.50 percent, and leverage ratio was 8.96 percent.

The company's tangible common equity ratio, a non-GAAP measure, was 8.64 percent at March 31, 2019 and 8.82 percent at December 31, 2018. The tangible common equity ratio is primarily based on total shareholders' equity, which includes unrealized gains and losses on available for sale securities. The company has elected to exclude unrealized gains and losses from available for sale securities from its calculation of Tier 1 capital for regulatory capital purposes, consistent with the treatment under the previous capital rules.

Credit Quality

Nonperforming assets totaled $262 million or 1.20 percent of outstanding loans and repossessed assets at March 31, 2019, compared to $267 million or 1.23 percent at December 31, 2018. Nonperforming assets that are not guaranteed by U.S. government agencies totaled $163 million or 0.75 percent of outstanding loans and repossessed assets at March 31, 2019, compared to $174 million or 0.81 percent at December 31, 2018.

Nonaccruing loans were $153 million or 0.70 percent of outstanding loans at March 31, 2019. Nonaccruing commercial loans totaled $90 million or 0.65 percent of outstanding commercial loans.  Nonaccruing commercial real estate loans totaled $22 million or 0.47 percent of outstanding commercial real estate loans. Nonaccruing residential mortgage loans totaled $40 million or 1.84 percent of outstanding residential mortgage loans.

Nonaccruing loans decreased $11 million from December 31, 2018, primarily due to a $12 million decrease in energy loans. Healthcare sector loans increased $2.2 million. New nonaccruing loans identified in the first quarter totaled $27 million, offset by $22 million in payments received and $12 million in charge-offs.

Potential problem loans, which are defined as performing loans that, based on known information, cause management concern as to the borrowers' ability to continue to perform, totaled $169 million at March 31, compared to $215 million at December 31. The decrease was primarily due to a $24 million decrease in healthcare sector loans, a $7.5 million decrease in permanent residential mortgage loans and a $5.3 million decrease in energy loans.

Net charge-offs were $10.1 million or 0.19 percent of average loans on an annualized basis for the first quarter of 2019, compared to $12.3 million or 0.23 percent of average loans on an annualized basis for the fourth quarter of 2018. Net charge-offs were 0.23 percent of average loans over the last four quarters. Net charge-offs for the first quarter were primarily related to a single energy production borrower and a single healthcare borrower, both of which had previously been identified as impaired and appropriately reserved. Gross charge-offs were $11.8 million for the first quarter compared to $14.5 million for the previous quarter. Recoveries totaled $1.7 million for the first quarter of 2019 and $2.2 million for the fourth quarter of 2018.

Based on an evaluation of all credit factors, including overall loan portfolio growth, changes in nonaccruing and potential problem loans and net charge-offs, the company determined that an $8.0 million provision for credit losses was appropriate for the first quarter of 2019. The company recorded a $9.0 million provision for credit losses in the fourth quarter of 2018.

The combined allowance for credit losses totaled $207 million or 0.95 percent of outstanding loans and 142 percent of nonaccruing loans at March 31, 2019, excluding residential mortgage loans guaranteed by U.S. government agencies. Excluding loans acquired in the CoBiz acquisition, which are measured at acquisition-date fair value, the combined allowance for loan losses was 1.09 percent of outstanding loans and 159 percent of nonaccruing loans at March 31, 2019 compared to 1.12 percent of outstanding loans and 146 percent of nonaccruing loans at December 31, 2018. The allowance for loan losses was $205 million and the accrual for off-balance sheet credit losses was $1.8 million. At December 31, 2018, the combined allowance for credit losses was $209 million or 0.97 percent of outstanding loans and 134 percent of nonaccruing loans, excluding loans guaranteed by U.S. government agencies. The allowance for loan losses was $207 million and the accrual for off-balance sheet credit losses was $1.8 million.

Securities and Derivatives

The fair value of the available for sale securities portfolio totaled $9.0 billion at March 31, 2019, a $168 million increase compared to December 31, 2018. At March 31, 2019, the available for sale securities portfolio consisted primarily of $6.0 billion of residential mortgage-backed securities fully backed by U.S. government agencies and $2.9 billion of commercial mortgage-backed securities fully backed by U.S. government agencies. At March 31, 2019, the available for sale securities portfolio had a net unrealized loss of $2.6 million compared to a $95 million net unrealized loss at December 31, 2018.

Trading securities increased $183 million to $2.1 billion during the first quarter of 2019. The company holds an inventory of securities, predominately composed of U.S. agency residential mortgage-backed securities, in support of sales to a variety of customers, including banks, corporations, insurance companies, money managers, and others.

The company also maintains a portfolio of residential mortgage-backed securities issued by U.S. government agencies and interest rate derivative contracts as an economic hedge of the changes in the fair value of our mortgage servicing rights.

The net economic cost of the changes in fair value of mortgage servicing rights and related economic hedges was $5.4 million during the first quarter of 2019, including a $20.7 million decrease in the fair value of mortgage servicing rights, a $14.1 million increase in the fair value of securities and derivative contracts held as an economic hedge, and $1.1 million of related net interest revenue.

Commercial Banking 

Net income for Commercial Banking was $86.1 million for the first quarter of 2019, an increase of $1.6 million over the fourth quarter of 2018. Increased net interest revenue was partially offset by decreased fee revenue.

Average loans increased $364 million or 2 percent. Average customer deposits were $8.3 billion, a decrease of $131 million or 2 percent. We continue to see a shift in the deposit mix with demand deposit balances declining $411 million and interest-bearing transaction deposits increasing $277 million.

Operating revenue decreased $1.8 million, partially offset by a decrease in operating expenses of $1.5 million.

Consumer Banking

Net income from Consumer Banking was $15.6 million in the first quarter of 2019, an increase of $12.8 million.

Net interest revenue from Consumer Banking activities increased $9.7 million, primarily due to increased yields on deposits sold to our Funds Management unit as consumer deposits are more valuable in a rising rate environment. In addition, lower recent interest rates have spurred mortgage application volume in the first quarter of 2019. Average loans and average deposits were both relatively consistent with the fourth quarter of 2018.

Revenues from mortgage banking activities increased $1.9 million over the prior quarter due to lower interest rates. Mortgage production volume increased $153 million or 33 percent and gain on sale margins climbed to 1.28 percent from 1.10 percent. Deposit service charges declined $1.6 million due to two less days in the quarter compared to the previous quarter.

Operating expenses decreased $2.6 million. A $4.1 million decrease in non-personnel expenses was partially offset by an increase of $1.6 million in personnel expenses. In the first quarter of 2019, we made the decision to exit our lower margin online lead buying business, HomeDirect, to focus on our core competency of developing complete, long-term relationships with our clients.

The net economic cost of the changes in fair value of mortgage servicing rights and related economic hedges was $5.4 million for the first quarter of 2019 compared to $11.7 million for the fourth quarter of 2018.

Wealth Management

Net income for Wealth Management increased $6.2 million to $23.7 million during the first quarter of 2019. While fiduciary fees and commissions remained consistent with the fourth quarter of 2018, we saw an increase of $6.4 million in brokerage and trading revenue. This increase was partially offset by a decrease in interest received on trading securities and increase in funding costs. Operating expenses decreased $3.0 million, including $2.0 million related to personnel expenses and $1.1 million related to other operating expenses. Personnel expenses decreased primarily due to retention incentives accrued in the fourth quarter.

Average loans were stable at $1.4 billion. Average deposits increased $176 million to $5.7 billion, primarily due to an increase in interest-bearing transaction account balances. Assets under management or administration were $78.9 billion at March 31, 2019 compared to $76.3 billion at December 31, 2018. Fiduciary assets totaled $46.4 billion at March 31, 2019 and $44.8 billion at December 31, 2018.

Conference Call and Webcast

The company will hold a conference call at 9 a.m. Central time on Wednesday, April 24, 2019 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 1-201-689-8471. A conference call and webcast replay will also be available shortly after conclusion of the live call at www.bokf.com or by dialing 1-412-317-6671 and referencing conference ID # 13689382.

About BOK Financial Corporation

BOK Financial Corporation is a $40 billion regional financial services company headquartered in Tulsa, Oklahoma with $79 billion in assets under management and administration. The company's stock is publicly traded on NASDAQ under the Global Select market listings (BOKF). BOK Financial Corporation's holdings include BOKF, NA; BOK Financial Securities, Inc., The Milestone Group, Inc., CoBiz Wealth, LLC and BOK Financial Insurance, Inc. BOKF, NA operates TransFund, Cavanal Hill Investment Management and BOK Financial Asset Management, Inc. BOKF, NA operates banking divisions across eight states as: Bank of Albuquerque; Bank of Arkansas; Bank of Oklahoma; Bank of Texas; BOK Financial in Colorado and Arizona; and Mobank in Kansas and Missouri; as well as having limited purpose offices in Nebraska, Milwaukee and Connecticut. Through its subsidiaries, BOK Financial Corporation provides commercial and consumer banking, brokerage trading, investment, trust and insurance 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 March 31, 2019 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,” “will,”  “intends,” 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, allowance for uncertain tax positions, accruals for loss contingencies and valuation of mortgage servicing rights involve judgments as to expected events and are inherently forward-looking statements. Assessments that BOK Financial's acquisitions, including its latest acquisition of CoBiz Financial, Inc., 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 changes in commodity prices, interest rates and interest rate relationships, inflation, demand for products and services, the degree of competition by traditional and nontraditional competitors, changes in banking regulations, tax laws, prices, levies and assessments, the impact of technological advances, and trends in customer behavior as well as their ability to repay loans. There may also be difficulties and delays in integrating CoBiz Financial Inc.'s business or fully realizing cost savings and other benefits including, but not limited to, business disruption and customer acceptance of BOK Financial Corporation's products and services. 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)
  Mar. 31, 2019   Dec. 31, 2018
ASSETS      
Cash and due from banks $ 718,297     $ 741,749  
Interest-bearing cash and cash equivalents 564,404     401,675  
Trading securities 2,140,326     1,956,923  
Investment securities 331,466     355,187  
Available for sale securities 9,025,198     8,857,120  
Fair value option securities 707,994     283,235  
Restricted equity securities 376,429     344,447  
Residential mortgage loans held for sale 160,157     149,221  
Loans:      
Commercial 13,961,975     13,636,078  
Commercial real estate 4,600,651     4,764,813  
Residential mortgage 2,192,620     2,230,033  
Personal 1,003,734     1,025,806  
Total loans 21,758,980     21,656,730  
Allowance for loan losses (205,340 )   (207,457 )
Loans, net of allowance 21,553,640     21,449,273  
Premises and equipment, net 468,293     330,033  
Receivables 224,887     204,960  
Goodwill 1,048,091     1,049,263  
Intangible assets, net 129,482     134,849  
Mortgage servicing rights 238,193     259,254  
Real estate and other repossessed assets, net 17,139     17,487  
Derivative contracts, net 359,223     320,929  
Cash surrender value of bank-owned life insurance 384,174     381,608  
Receivable on unsettled securities sales 966,455     336,400  
Other assets 469,114     446,891  
TOTAL ASSETS $ 39,882,962     $ 38,020,504  
       
LIABILITIES AND EQUITY      
Deposits:      
Demand $ 10,096,552     $ 10,414,592  
Interest-bearing transaction 12,476,977     12,206,576  
Savings 559,884     529,215  
Time 2,198,389     2,113,380  
Total deposits 25,331,802     25,263,763  
Funds purchased and repurchase agreements 1,439,673     1,018,411  
Other borrowings 7,341,093     6,124,390  
Subordinated debentures 275,880     275,913  
Accrued interest, taxes and expense 173,434     192,826  
Due on unsettled securities purchases 186,401     156,370  
Derivative contracts, net 299,698     362,306  
Other liabilities 303,272     183,480  
TOTAL LIABILITIES 35,351,253     33,577,459  
Shareholders' equity:      
Capital, surplus and retained earnings 4,526,404     4,504,694  
Accumulated other comprehensive loss (3,531 )   (72,585 )
TOTAL SHAREHOLDERS' EQUITY 4,522,873     4,432,109  
Non-controlling interests 8,836     10,936  
TOTAL EQUITY 4,531,709     4,443,045  
TOTAL LIABILITIES AND EQUITY $ 39,882,962     $ 38,020,504  

 

AVERAGE BALANCE SHEETS -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands)
  Three Months Ended
  Mar. 31, 2019   Dec. 31, 2018   Sept. 30, 2018   June 30, 2018   Mar. 31, 2018
ASSETS                  
Interest-bearing cash and cash equivalents $ 537,903     $ 563,132     $ 688,872     $ 1,673,387     $ 2,059,517  
Trading securities 1,968,399     1,929,601     1,762,794     1,482,302     933,404  
Investment securities 343,282     364,737     379,566     399,088     441,207  
Available for sale securities 8,883,054     8,704,963     8,129,214     8,163,142     8,236,938  
Fair value option securities 594,349     277,575     469,398     487,192     626,251  
Restricted equity securities 395,432     362,729     328,842     348,546     349,176  
Residential mortgage loans held for sale 145,040     179,553     207,488     218,600     199,380  
Loans:                  
Commercial 13,966,521     13,587,344     11,484,200     11,189,899     10,871,569  
Commercial real estate 4,602,149     4,747,784     3,774,470     3,660,166     3,491,335  
Residential mortgage 2,193,334     2,222,063     1,956,089     1,915,015     1,937,198  
Personal 1,004,061     1,022,140     989,026     986,162     961,379  
Total loans 21,766,065     21,579,331     18,203,785     17,751,242     17,261,481  
Allowance for loan losses (206,092 )   (209,613 )   (214,160 )   (222,856 )   (228,996 )
Total loans, net 21,559,973     21,369,718     17,989,625     17,528,386     17,032,485  
Total earning assets 34,427,432     33,752,008     29,955,799     30,300,643     29,878,358  
Cash and due from banks 705,411     731,700     578,905     571,333     564,585  
Derivative contracts, net 262,927     299,319     294,126     318,375     278,694  
Cash surrender value of bank-owned life insurance 382,538     379,893     322,038     319,507     317,334  
Receivable on unsettled securities sales 1,224,700     799,548     768,785     618,240     998,803  
Other assets 2,669,673     2,423,275     1,776,164     1,777,937     1,687,178  
TOTAL ASSETS $ 39,672,681     $ 38,385,743     $ 33,695,817     $ 33,906,035     $ 33,724,952  
                   
LIABILITIES AND EQUITY                  
Deposits:                  
Demand $ 9,988,088     $ 10,648,683     $ 9,325,002     $ 9,223,327     $ 9,151,272  
Interest-bearing transaction 11,931,539     11,773,651     10,010,031     10,189,354     10,344,469  
Savings 541,575     526,275     503,821     503,671     480,110  
Time 2,153,277     2,146,786     2,097,441     2,138,880     2,151,044  
Total deposits 24,614,479     25,095,395     21,936,295     22,055,232     22,126,895  
Funds purchased and repurchase agreements 2,033,036     1,205,568     1,193,583     593,250     532,412  
Other borrowings 7,040,279     6,361,141     5,765,440     6,497,020     6,326,967  
Subordinated debentures 275,882     276,378     144,702     144,692     144,682  
Derivative contracts, net 273,786     268,848     185,029     235,543     223,373  
Due on unsettled securities purchases 453,937     493,887     544,263     527,804     558,898  
Other liabilities 501,788     341,438     311,605     340,322     333,151  
TOTAL LIABILITIES 35,193,187     34,042,655     30,080,917     30,393,863     30,246,378  
Total equity 4,479,494     4,343,088     3,614,900     3,512,172     3,478,574  
TOTAL LIABILITIES AND EQUITY $ 39,672,681     $ 38,385,743     $ 33,695,817     $ 33,906,035     $ 33,724,952  

 

STATEMENTS OF EARNINGS -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands, except per share data)
  Three Months Ended
  March 31,
  2019   2018
       
Interest revenue $ 376,074     $ 265,407  
Interest expense 97,972     45,671  
Net interest revenue 278,102     219,736  
Provision for credit losses 8,000     (5,000 )
Net interest revenue after provision for credit losses 270,102     224,736  
Other operating revenue:      
Brokerage and trading revenue 31,617     30,648  
Transaction card revenue 20,738     20,990  
Fiduciary and asset management revenue 43,358     41,832  
Deposit service charges and fees 28,243     27,161  
Mortgage banking revenue 23,834     26,025  
Other revenue 12,762     12,958  
Total fees and commissions 160,552     159,614  
Other gains (losses), net 2,976     (1,292 )
Gain (loss) on derivatives, net 4,667     (5,685 )
Gain (loss) on fair value option securities, net 9,665     (17,564 )
Change in fair value of mortgage servicing rights (20,666 )   21,206  
Gain (loss) on available for sale securities, net 76     (290 )
Total other operating revenue 157,270     155,989  
Other operating expense:      
Personnel 169,228     139,947  
Business promotion 7,874     6,010  
Professional fees and services 16,139     10,200  
Net occupancy and equipment 29,521     24,046  
Insurance 4,839     6,593  
Data processing and communications 31,449     27,817  
Printing, postage and supplies 4,885     4,089  
Net losses and operating expenses of repossessed assets 1,996     7,705  
Amortization of intangible assets 5,191     1,300  
Mortgage banking costs 9,906     10,149  
Other expense 6,129     6,574  
Total other operating expense 287,157     244,430  
       
Net income before taxes 140,215     136,295  
Federal and state income taxes 29,950     30,948  
       
Net income 110,265     105,347  
Net loss attributable to non-controlling interests (347 )   (215 )
Net income attributable to BOK Financial Corporation shareholders $ 110,612     $ 105,562  
       
Average shares outstanding:      
Basic 71,387,070     64,847,334  
Diluted 71,404,388     64,888,033  
       
Net income per share:      
Basic $ 1.54     $ 1.61  
Diluted $ 1.54     $ 1.61  

 

FINANCIAL HIGHLIGHTS -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands, except ratio and share data)
  Three Months Ended
  Mar. 31, 2019   Dec. 31, 2018   Sept. 30, 2018   June 30, 2018   Mar. 31, 2018
Capital:                  
Period-end shareholders' equity $ 4,522,873     $ 4,432,109     $ 3,615,032     $ 3,553,431     $ 3,495,029  
Risk weighted assets $ 31,601,558     $ 30,742,295     $ 27,398,072     $ 27,004,559     $ 26,025,660  
Risk-based capital ratios:                  
Common equity tier 1 10.71 %   10.92 %   12.07 %   11.92 %   12.06 %
Tier 1 10.71 %   10.92 %   12.07 %   11.92 %   12.06 %
Total capital 12.24 %   12.50 %   13.37 %   13.26 %   13.49 %
Leverage ratio 8.76 %   8.96 %   9.90 %   9.57 %   9.40 %
Tangible common equity ratio1 8.64 %   8.82 %   9.55 %   9.21 %   9.18 %
                   
Common stock:                  
Book value per share $ 63.30     $ 61.45     $ 55.25     $ 54.30     $ 53.39  
Tangible book value per share 46.82     45.03     47.90     46.95     46.10  
Market value per share:                  
High $ 93.72     $ 98.29     $ 105.22     $ 106.65     $ 107.00  
Low $ 72.11     $ 69.96     $ 92.40     $ 92.39     $ 89.82  
Cash dividends paid $ 35,885     $ 35,977     $ 32,591     $ 29,340     $ 29,342  
Dividend payout ratio 32.44 %   33.17 %   27.79 %   25.65 %   27.80 %
Shares outstanding, net 71,449,982     72,122,932     65,434,258     65,439,090     65,459,505  
Stock buy-back program:                  
Shares repurchased 705,609     525,000         8,257     82,583  
Amount $ 60,577     $ 45,057     $     $ 824     $ 7,584  
Average price per share $ 85.85     $ 85.82     $     $ 99.84     $ 91.83  
                   
Performance ratios (quarter annualized):
Return on average assets 1.13 %   1.12 %   1.38 %   1.35 %   1.27 %
Return on average equity 10.04 %   9.93 %   12.95 %   13.14 %   12.39 %
Net interest margin 3.30 %   3.40 %   3.21 %   3.17 %   2.99 %
Efficiency ratio 64.80 %   63.25 %   61.60 %   61.77 %   64.98 %
                   
Reconciliation of non-GAAP measures:
1  Tangible common equity ratio:                  
Total shareholders' equity $ 4,522,873     $ 4,432,109     $ 3,615,032     $ 3,553,431     $ 3,495,029  
Less: Goodwill and intangible assets, net 1,177,573     1,184,112     480,800     481,366     477,088  
Tangible common equity $ 3,345,300     $ 3,247,997     $ 3,134,232     $ 3,072,065     $ 3,017,941  
                   
Total assets $ 39,882,962     $ 38,020,504     $ 33,289,864     $ 33,833,107     $ 33,361,492  
Less: Goodwill and intangible assets, net 1,177,573     1,184,112     480,800     481,366     477,088  
Tangible assets $ 38,705,389     $ 36,836,392     $ 32,809,064     $ 33,351,741     $ 32,884,404  
                   
Tangible common equity ratio 8.64 %   8.82 %   9.55 %   9.21 %   9.18 %
                   
Other data:                  
Fiduciary assets $ 46,401,149     $ 44,841,339     $ 45,560,107     $ 46,531,900     $ 46,648,290  
Tax equivalent interest $ 3,148     $ 3,067     $ 1,894     $ 1,983     $ 2,010  
Net unrealized loss on available for sale securities $ (2,609 )   $ (95,271 )   $ (216,793 )   $ (180,602 )   $ (148,247 )
                   
                   
 

 
                 
Mortgage banking:                  
Mortgage production revenue $ 7,868     $ 5,073     $ 7,250     $ 9,915     $ 9,452  
                   
Mortgage loans funded for sale $ 510,527     $ 497,353     $ 651,076     $ 773,910     $ 664,958  
Add: current period-end outstanding commitments 263,434     160,848     197,752     251,231     298,318  
Less: prior period end outstanding commitments 160,848     197,752     251,231     298,318     222,919  
Total mortgage production volume $ 613,113     $ 460,449     $ 597,597     $ 726,823     $ 740,357  
                   
Mortgage loan refinances to mortgage loans funded for sale 30 %   23 %   23 %   22 %   42 %
Gain on sale margin 1.28 %   1.10 %   1.21 %   1.36 %   1.28 %
                   
Mortgage servicing revenue $ 15,966     $ 16,807     $ 16,286     $ 16,431     $ 16,573  
Average outstanding principal balance of mortgage loans serviced for others 21,581,835     21,706,541     21,895,041     21,986,065     22,027,726  
Average mortgage servicing revenue rates 0.30 %   0.31 %   0.30 %   0.30 %   0.31 %
                   
Gain (loss) on mortgage servicing rights, net of economic hedge:
Gain (loss) on mortgage hedge derivative contracts, net $ 4,432     $ 12,162     $ (2,843 )   $ (3,070 )   $ (5,698 )
Gain (loss) on fair value option securities, net 9,665     (282 )   (4,385 )   (3,341 )   (17,564 )
Gain (loss) on economic hedge of mortgage servicing rights 14,097     11,880     (7,228 )   (6,411 )   (23,262 )
Gain (loss) on changes in fair value of mortgage servicing rights (20,666 )   (24,233 )   5,972     1,723     21,206  
Loss on changes in fair value of mortgage servicing rights, net of economic hedges, included in other operating revenue (6,569 )   (12,353 )   (1,256 )   (4,688 )   (2,056 )
Net interest revenue on fair value option securities2 1,129     695     1,100     1,203     1,800  
Total economic cost of changes in the fair value of mortgage servicing rights, net of economic hedges $ (5,440 )   $ (11,658 )   $ (156 )   $ (3,485 )   $ (256 )

2    Actual interest earned on fair value option securities less internal transfer-priced cost of funds.

 

QUARTERLY EARNINGS TREND -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands, except ratio and per share data)
  Three Months Ended
  Mar. 31, 2019   Dec. 31, 2018   Sept. 30, 2018   June 30, 2018   Mar. 31, 2018
                   
Interest revenue $ 376,074     $ 365,592     $ 303,247     $ 294,180     $ 265,407  
Interest expense 97,972     79,906     62,364     55,618     45,671  
Net interest revenue 278,102     285,686     240,883     238,562     219,736  
Provision for credit losses 8,000     9,000     4,000         (5,000 )
Net interest revenue after provision for credit losses 270,102     276,686     236,883     238,562     224,736  
Other operating revenue:                  
Brokerage and trading revenue 31,617     28,101     23,086     26,488     30,648  
Transaction card revenue 20,738     20,664     21,396     20,975     20,990  
Fiduciary and asset management revenue 43,358     43,665     57,514     41,692     41,832  
Deposit service charges and fees 28,243     29,393     27,765     27,834     27,161  
Mortgage banking revenue 23,834     21,880     23,536     26,346     26,025  
Other revenue 12,762     16,404     12,900     13,923     12,958  
Total fees and commissions 160,552     160,107     166,197     157,258     159,614  
Other gains (losses), net 2,976     (8,305 )   2,754     4,578     (1,292 )
Gain (loss) on derivatives, net 4,667     11,167     (2,847 )   (3,057 )   (5,685 )
Gain (loss) on fair value option securities, net 9,665     (282 )   (4,385 )   (3,341 )   (17,564 )
Change in fair value of mortgage servicing rights (20,666 )   (24,233 )   5,972     1,723     21,206  
Gain (loss) on available for sale securities, net 76     (1,999 )   250     (762 )   (290 )
Total other operating revenue 157,270     136,455     167,941     156,399     155,989  
Other operating expense:                  
Personnel 169,228     160,706     143,531     138,947     139,947  
Business promotion 7,874     9,207     7,620     7,686     6,010  
Charitable contributions to BOKF Foundation     2,846              
Professional fees and services 16,139     20,712     13,209     14,978     10,200  
Net occupancy and equipment 29,521     27,780     23,394     22,761     24,046  
Insurance 4,839     4,248     6,232     6,245     6,593  
Data processing and communications 31,449     27,575     31,665     27,739     27,817  
Printing, postage and supplies 4,885     5,232     3,837     4,011     4,089  
Net losses and operating expenses of repossessed assets 1,996     2,581     4,044     2,722     7,705  
Amortization of intangible assets 5,191     5,331     1,603     1,386     1,300  
Mortgage banking costs 9,906     11,518     11,741     12,890     10,149  
Other expense 6,129     6,907     5,741     7,111     6,574  
Total other operating expense 287,157     284,643     252,617     246,476     244,430  
Net income before taxes 140,215     128,498     152,207     148,485     136,295  
Federal and state income taxes 29,950     20,121     34,662     33,330     30,948  
Net income 110,265     108,377     117,545     115,155     105,347  
Net income (loss) attributable to non-controlling interests (347 )   (79 )   289     783     (215 )
Net income attributable to BOK Financial Corporation shareholders $ 110,612     $ 108,456     $ 117,256     $ 114,372     $ 105,562  
                   
Average shares outstanding:                  
Basic 71,387,070     71,808,029     64,901,095     64,901,975     64,847,334  
Diluted 71,404,388     71,833,334     64,934,351     64,937,226     64,888,033  
Net income per share:                  
Basic $ 1.54     $ 1.50     $ 1.79     $ 1.75     $ 1.61  
Diluted $ 1.54     $ 1.50     $ 1.79     $ 1.75     $ 1.61  

 

LOANS TREND -- UNAUDITED
BOK FINANCIAL CORPORATION
(In thousands)
    Mar. 31, 2019   Dec. 31, 2018   Sept. 30, 2018   June 30, 2018   Mar. 31, 2018
Commercial:                    
Energy   $ 3,705,099     $ 3,590,333     $ 3,294,867     $ 3,147,219     $ 2,969,618  
Services   3,287,563     3,258,192     2,603,862     2,516,676     2,488,065  
Healthcare   2,915,885     2,799,277     2,437,323     2,353,722     2,359,928  
Wholesale/retail   1,706,900     1,621,158     1,650,729     1,699,554     1,531,576  
Public finance   803,083     804,550     418,578     433,408     445,814  
Manufacturing   742,374     730,521     660,582     647,816     559,695  
Other commercial and industrial   801,071     832,047     510,160     550,644     564,971  
Total commercial   13,961,975     13,636,078     11,576,101     11,349,039     10,919,667  
                     
Commercial real estate:                    
Multifamily   1,210,358     1,288,065     1,120,166     1,056,984     1,008,903  
Office   1,033,158     1,072,920     824,829     820,127     737,144  
Retail   890,685     919,082     759,423     768,024     750,396  
Industrial   767,757     778,106     696,774     653,384     613,608  
Residential construction and land development   149,686     148,584     101,872     118,999     117,458  
Other commercial real estate   549,007     558,056     301,611     294,702     279,273  
Total commercial real estate   4,600,651     4,764,813     3,804,675     3,712,220     3,506,782  
                     
Residential mortgage:                    
Permanent mortgage   1,098,481     1,122,610     1,094,926     1,068,412     1,047,785  
Permanent mortgages guaranteed by U.S. government agencies   193,308     190,866     180,718     169,653     177,880  
Home equity   900,831     916,557     696,098     704,185     720,104  
Total residential mortgage   2,192,620     2,230,033     1,971,742     1,942,250     1,945,769  
                     
Personal   1,003,734     1,025,806     996,941     1,000,187     965,632  
                     
Total   $ 21,758,980     $ 21,656,730     $ 18,349,459     $ 18,003,696     $ 17,337,850  

 

LOANS BY PRINCIPAL MARKET AREA -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands)
  Mar. 31, 2019   Dec. 31, 2018   Sept. 30, 2018   June 30, 2018   Mar. 31, 2018
                   
Oklahoma:                  
Commercial $ 3,551,054     $ 3,491,117     $ 3,609,109     $ 3,465,407     $ 3,265,013  
Commercial real estate 665,190     700,756     651,315     662,665     668,031  
Residential mortgage 1,417,381     1,440,566     1,429,843     1,403,658     1,419,281  
Personal 374,807     375,543     376,201     362,846     353,128  
Total Oklahoma 6,008,432     6,007,982     6,066,468     5,894,576     5,705,453  
                   
Texas:                  
Commercial 5,754,018     5,438,133     5,115,646     4,922,451     4,715,841  
Commercial real estate 1,344,810     1,341,783     1,354,679     1,336,101     1,254,421  
Residential mortgage 265,927     266,805     253,265     243,400     229,761  
Personal 396,794     394,743     381,452     394,021     363,608  
Total Texas 7,761,549     7,441,464     7,105,042     6,895,973     6,563,631  
                   
New Mexico:                  
Commercial 342,915     340,489     325,048     305,167     315,701  
Commercial real estate 371,416     383,670     392,494     386,878     348,485  
Residential mortgage 85,326     87,346     88,110     90,581     93,490  
Personal 11,065     10,662     11,659     11,107     11,667  
Total New Mexico 810,722     822,167     817,311     793,733     769,343  
                   
Arkansas:                  
Commercial 79,286     111,338     102,237     93,217     94,430  
Commercial real estate 142,551     141,898     106,701     90,807     88,700  
Residential mortgage 7,731     7,537     7,278     6,927     7,033  
Personal 11,550     11,955     12,126     12,331     9,916  
Total Arkansas 241,118     272,728     228,342     203,282     200,079  
                   
Colorado:                  
Commercial 2,231,703     2,275,069     1,132,500     1,165,721     1,180,655  
Commercial real estate 957,348     963,575     354,543     267,065     210,801  
Residential mortgage 241,722     251,849     68,694     64,839     64,530  
Personal 65,812     72,916     56,999     60,504     63,118  
Total Colorado 3,496,585     3,563,409     1,612,736     1,558,129     1,519,104  
                   
Arizona:                  
Commercial 1,335,140     1,320,139     621,658     681,852     624,106  
Commercial real estate 791,466     889,903     666,562     710,784     672,319  
Residential mortgage 98,973     97,959     44,659     47,010     39,227  
Personal 61,875     68,546     67,280     65,541     57,023  
Total Arizona 2,287,454     2,376,547     1,400,159     1,505,187     1,392,675  
                   
Kansas/Missouri:                  
Commercial 667,859     659,793     669,903     715,224     723,921  
Commercial real estate 327,870     343,228     278,381     257,920     264,025  
Residential mortgage 75,560     77,971     79,893     85,835     92,447  
Personal 81,831     91,441     91,224     93,837     107,172  
Total Kansas/Missouri 1,153,120     1,172,433     1,119,401     1,152,816     1,187,565  
                   
TOTAL BOK FINANCIAL $ 21,758,980     $ 21,656,730     $ 18,349,459     $ 18,003,696     $ 17,337,850  

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)
  Mar. 31, 2019   Dec. 31, 2018   Sept. 30, 2018   June 30, 2018   Mar. 31, 2018
Oklahoma:                  
  Demand $ 3,432,239     $ 3,610,593     $ 3,564,307     $ 3,867,934     $ 4,201,843  
  Interest-bearing:                  
  Transaction 6,542,548     6,445,831     6,010,972     5,968,459     6,051,301  
  Savings 309,875     288,210     288,080     289,202     289,351  
  Time 1,217,371     1,118,643     1,128,810     1,207,471     1,203,534  
  Total interest-bearing 8,069,794     7,852,684     7,427,862     7,465,132     7,544,186  
Total Oklahoma 11,502,033     11,463,277     10,992,169     11,333,066     11,746,029  
                   
Texas:                  
  Demand 2,966,743     3,291,433     3,357,669     3,321,980     3,019,483  
  Interest-bearing:                  
  Transaction 2,385,305     2,295,169     2,182,114     2,169,155     2,208,892  
  Savings 101,849     99,624     97,909     97,809     98,852  
  Time 419,269     423,880     453,119     445,500     475,967  
  Total interest-bearing 2,906,423     2,818,673     2,733,142     2,712,464     2,783,711  
Total Texas 5,873,166     6,110,106     6,090,811     6,034,444     5,803,194  
                   
New Mexico:                  
  Demand 662,362     691,692     722,188     770,974     695,060  
  Interest-bearing:                  
  Transaction 573,203     571,347     593,760     586,593     555,414  
  Savings 61,497     58,194     57,794     59,415     60,596  
  Time 228,212     224,515     221,513     212,689     216,306  
  Total interest-bearing 862,912     854,056     873,067     858,697     832,316  
Total New Mexico 1,525,274     1,545,748     1,595,255     1,629,671     1,527,376  
                   
Arkansas:                  
  Demand 31,624     36,800     36,579     39,896     35,291  
  Interest-bearing:                  
  Transaction 147,964     91,593     128,001     143,298     94,206  
  Savings 1,785     1,632     1,826     1,885     1,960  
  Time 8,321     8,726     10,214     10,771     11,878  
  Total interest-bearing 158,070     101,951     140,041     155,954     108,044  
Total Arkansas 189,694     138,751     176,620     195,850     143,335  
                   
Colorado:                  
  Demand 1,897,547     1,658,473     593,442     529,912     521,963  
  Interest-bearing:                  
  Transaction 1,844,632     1,899,203     622,520     701,362     687,785  
  Savings 58,919     57,289     40,308     38,176     37,232  
  Time 261,235     274,877     217,628     208,049     215,330  
  Total interest-bearing 2,164,786     2,231,369     880,456     947,587     940,347  
Total Colorado 4,062,333     3,889,842     1,473,898     1,477,499     1,462,310  
                   
Arizona:                  
  Demand 695,238     707,402     365,878     383,627     326,581  
  Interest-bearing:                  
  Transaction 621,735     575,567     130,105     193,687     247,926  
  Savings 12,144     10,545     3,559     3,935     4,116  
  Time 44,004     43,051     23,927     22,447     21,009  
  Total interest-bearing 677,883     629,163     157,591     220,069     273,051  
Total Arizona 1,373,121     1,336,565     523,469     603,696     599,632  
                   
Kansas/Missouri:                  
  Demand 410,799     418,199     423,560     459,636     505,802  
  Interest-bearing:                  
  Transaction 361,590     327,866     322,747     401,545     381,447  
  Savings 13,815     13,721     13,125     13,052     13,845  
  Time 19,977     19,688     20,635     20,805     22,230  
  Total interest-bearing 395,382     361,275     356,507     435,402     417,522  
Total Kansas/Missouri 806,181     779,474     780,067     895,038     923,324  
                   
TOTAL BOK FINANCIAL $ 25,331,802     $ 25,263,763     $ 21,632,289     $ 22,169,264     $ 22,205,200  

 

NET INTEREST MARGIN TREND -- UNAUDITED
BOK FINANCIAL CORPORATION
  Three Months Ended
  Mar. 31, 2019   Dec. 31, 2018   Sept. 30, 2018   June 30, 2018   Mar. 31, 2018
                   
TAX-EQUIVALENT ASSETS YIELDS                  
Interest-bearing cash and cash equivalents 2.56 %   2.23 %   1.98 %   1.86 %   1.57 %
Trading securities 3.88 %   4.10 %   3.98 %   3.63 %   3.40 %
Investment securities 5.22 %   4.26 %   4.06 %   3.95 %   3.78 %
Available for sale securities 2.57 %   2.51 %   2.37 %   2.30 %   2.23 %
Fair value option securities 3.62 %   3.56 %   3.25 %   3.16 %   2.95 %
Restricted equity securities 6.42 %   6.39 %   6.36 %   6.21 %   5.86 %
Residential mortgage loans held for sale 4.58 %   4.00 %   4.27 %   4.28 %   3.71 %
Loans 5.26 %   5.09 %   4.80 %   4.80 %   4.45 %
Allowance for loan losses                  
Loans, net of allowance 5.31 %   5.14 %   4.86 %   4.86 %   4.51 %
Total tax-equivalent yield on earning assets 4.46 %   4.33 %   4.04 %   3.91 %   3.61 %
                   
COST OF INTEREST-BEARING LIABILITIES                
Interest-bearing deposits:                  
  Interest-bearing transaction 0.94 %   0.79 %   0.67 %   0.55 %   0.45 %
  Savings 0.12 %   0.11 %   0.09 %   0.08 %   0.07 %
  Time 1.80 %   1.54 %   1.40 %   1.29 %   1.25 %
Total interest-bearing deposits 1.04 %   0.87 %   0.77 %   0.66 %   0.57 %
Funds purchased and repurchase agreements 2.07 %   1.36 %   1.25 %   0.53 %   0.40 %
Other borrowings 2.68 %   2.51 %   2.20 %   1.96 %   1.60 %
Subordinated debt 5.51 %   5.38 %   5.55 %   5.67 %   5.61 %
Total cost of interest-bearing liabilities 1.66 %   1.42 %   1.25 %   1.11 %   0.93 %
Tax-equivalent net interest revenue spread 2.80 %   2.91 %   2.79 %   2.80 %   2.68 %
Effect of noninterest-bearing funding sources and other 0.50 %   0.49 %   0.42 %   0.37 %   0.31 %
Tax-equivalent net interest margin 3.30 %   3.40 %   3.21 %   3.17 %   2.99 %

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. Yield/rate calculations are generally based on the conventions that determine how interest income and expense is accrued.

CREDIT QUALITY INDICATORS -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands, except ratios)
  Three Months Ended
  Mar. 31, 2019   Dec. 31, 2018   Sept. 30, 2018   June 30, 2018   Mar. 31, 2018
Nonperforming assets:                  
Nonaccruing loans:                  
Commercial $ 90,358     $ 99,841     $ 109,490     $ 120,978     $ 131,460  
Commercial real estate 21,508     21,621     1,316     1,996     2,470  
Residential mortgage 40,409     41,555     41,917     42,343     45,794  
Personal 302     230     269     340     340  
Total nonaccruing loans 152,577     163,247     152,992     165,657     180,064  
Accruing renegotiated loans guaranteed by U.S. government agencies 91,787     86,428     83,347     75,374     74,418  
Real estate and other repossessed assets 17,139     17,487     24,515     27,891     23,652  
Total nonperforming assets $ 261,503     $ 267,162     $ 260,854     $ 268,922     $ 278,134  
Total nonperforming assets excluding those guaranteed by U.S. government agencies $ 162,770     $ 173,602     $ 169,717     $ 185,981     $ 194,833  
                   
Nonaccruing loans by loan class:                  
Commercial:                  
Energy $ 35,332     $ 47,494     $ 54,033     $ 65,597     $ 89,942  
Services 9,555     8,567     4,097     4,377     2,109  
Healthcare 18,768     16,538     15,704     16,125     15,342  
Manufacturing 9,548     8,919     9,202     2,991     3,002  
Wholesale/retail 1,425     1,316     9,249     14,095     2,564  
Public finance                  
Other commercial and industrial 15,730     17,007     17,205     17,793     18,501  
Total commercial 90,358     99,841     109,490     120,978     131,460  
Commercial real estate:                  
Retail 20,159     20,279     777     1,068     264  
Residential construction and land development 350     350     350     350     1,613  
Multifamily     301              
Office 855             275     275  
Industrial                  
Other commercial real estate 144     691     189     303     318  
Total commercial real estate 21,508     21,621     1,316     1,996     2,470  
Residential mortgage:                  
Permanent mortgage 22,937     23,951     22,855     23,105     24,578  
Permanent mortgage guaranteed by U.S. government agencies 6,946     7,132     7,790     7,567     8,883  
Home equity 10,526     10,472     11,272     11,671     12,333  
Total residential mortgage 40,409     41,555     41,917     42,343     45,794  
Personal 302     230     269     340     340  
Total nonaccruing loans $ 152,577     $ 163,247     $ 152,992     $ 165,657     $ 180,064  
                   
Performing loans 90 days past due1 $ 610     $ 1,338     $ 518     $ 879     $ 90  
                   
Gross charge-offs $ 11,775     $ 14,515     $ 11,073     $ 15,105     $ 2,890  
Recoveries (1,689 )   (2,168 )   (2,092 )   (4,578 )   (1,576 )
Net charge-offs $ 10,086     $ 12,347     $ 8,981     $ 10,527     $ 1,314  
                   
Provision for credit losses $ 8,000     $ 9,000     $ 4,000     $     $ (5,000 )
                   
Allowance for loan losses to period end loans 0.94 %   0.96 %   1.15 %   1.19 %   1.29 %
Combined allowance for credit losses to period end loans 0.95 %   0.97 %   1.16 %   1.21 %   1.32 %
Nonperforming assets to period end loans and repossessed assets 1.20 %   1.23 %   1.42 %   1.49 %   1.60 %
Net charge-offs (annualized) to average loans 0.19 %   0.23 %   0.20 %   0.24 %   0.03 %
Allowance for loan losses to nonaccruing loans1 141.00 %   132.89 %   145.02 %   136.09 %   130.84 %
Combined allowance for credit losses to nonaccruing loans1 142.25 %   134.03 %   146.41 %   137.63 %   133.25 %

1   Excludes residential mortgage loans guaranteed by agencies of the U.S. government.

SEGMENTS -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands, except ratios)
    Three Months Ended   Change
Commercial Banking   Mar. 31, 2019   Dec. 31, 2018   Mar. 31, 2018   1Q19 vs 4Q18   1Q19 vs 1Q18
Net interest revenue   $ 151,647     $ 148,359     $ 132,071     2.2 %   14.8 %
Fees and commissions revenue   38,046     39,667     40,017     (4.1 )%   (4.9 )%
Other operating expense   50,177     51,628     48,370     (2.8 )%   3.7 %
Corporate expense allocations   10,148     9,112     10,603     11.4 %   (4.3 )%
Net income   86,143     84,588     79,247     1.8 %   8.7 %
                     
Average assets   19,931,964     19,341,927     17,793,820     3.1 %   12.0 %
Average loans   15,992,749     15,628,731     14,426,750     2.3 %   10.9 %
Average deposits   8,261,543     8,393,016     8,664,452     (1.6 )%   (4.7 )%
                     
Consumer Banking                    
Net interest revenue   $ 51,102     $ 41,364     $ 36,977     23.5 %   38.2 %
Fees and commissions revenue   42,821     42,839     44,963     %   (4.8 )%
Other operating expense   53,506     56,081     54,695     (4.6 )%   (2.2 )%
Corporate expense allocations   11,883     11,098     11,188     7.1 %   6.2 %
Net income   15,584     2,741     9,374     468.6 %   66.2 %
                     
Average assets   8,371,683     8,071,978     8,468,101     3.7 %   (1.1 )%
Average loans   1,750,642     1,745,642     1,746,136     0.3 %   0.3 %
Average deposits   6,544,665     6,542,188     6,538,096     %   0.1 %
                     
Wealth Management                    
Net interest revenue   $ 28,256     $ 29,292     $ 25,339     (3.5 )%   11.5 %
Fees and commissions revenue   73,256     67,607     74,807     8.4 %   (2.1 )%
Other operating expense   61,507     64,549     64,942     (4.7 )%   (5.3 )%
Corporate expense allocations   8,360     8,828     8,815     (5.3 )%   (5.2 )%
Net income   23,719     17,472     19,609     35.8 %   21.0 %
                     
Average assets   9,312,154     8,687,234     8,095,794     7.2 %   15.0 %
Average loans   1,448,718     1,448,805     1,389,926     %   4.2 %
Average deposits   5,659,771     5,483,455     5,662,470     3.2 %   %
Fiduciary assets   46,401,149     44,841,339     46,648,290     3.5 %   (0.5 )%
Assets under management or administration   78,852,284     76,279,777     78,878,989     3.4 %   %

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