Loading, Please Wait...

CST: 18/10/2019 19:07:10   

BOK Financial Reports Quarterly Earnings of $138 million or $1.93 Per Share

86 Days ago

TULSA, Okla., July 24, 2019 (GLOBE NEWSWIRE) -- BOK Financial (NASDAQ: BOKF) today reported net earnings applicable to common shareholders for the first quarter of 2019 of $137.6 million, or $1.93 per diluted common share, up 24% from the previous quarter and up 20% from the same quarter a year ago.

CEO Commentary

Steven G. Bradshaw, president and chief executive officer, stated, “The second quarter was another in a long line of exceptional earnings performance for BOK Financial. By achieving the highest level of quarterly earnings in the history of the company, our diversified revenue approach was on full display this quarter as continued growth in our loan portfolio was matched by re-energized activity in our fee businesses. Combined strength in these dual pillars of revenue generation, combined with diligent expense management, drove us through a 60 percent efficiency ratio for the first time since the first quarter of 2012. These factors, along with a benign credit environment, affirm our confidence for the remainder of 2019."

Bradshaw continued, "The overall momentum we are building in Colorado and Arizona on the back of the final systems integration of CoBiz last quarter is growing. Now that we've achieved the expense synergies, we are very focused on growing our share and serving our customers in both of these markets, and are pleased to see the progress we've made already."

Second Quarter 2019 Financial Highlights

  • Net income was $137.6 million or $1.93 per diluted share for the second quarter of 2019 and $110.6 million and $1.54 per diluted share for the first quarter of 2019. The first quarter included a 13 cent per share reduction due to CoBiz integration costs.
  • Net interest revenue totaled $285.4 million, an increase of $7.3 million. Net interest margin was consistent at 3.30 percent compared to the first quarter of 2019. Recovery of foregone interest and an increase in loan discount accretion added 10 basis points to net interest margin in the second quarter.
  • Fees and commissions revenue totaled $176.1 million, an increase of $15.6 million led by increases in trading revenue and mortgage banking revenue. Lower mortgage interest rates have increased mortgage production and related trading activity.
  • Operating expense decreased $10.0 million to $277.1 million. The first quarter of 2019 included $12.7 million of integration costs. Excluding first quarter integration costs, personnel expenses decreased $5.6 million as efficiencies are recognized from the CoBiz acquisition.
  • A $5.0 million provision for credit losses was recorded in the second quarter of 2019. The combined allowance for credit losses totaled $204 million or 0.92 percent of outstanding loans compared to $207 million or 0.95 percent in the previous quarter.
  • Average loans increased $238 million to $22.0 billion and period-end loans increased $497 million to $22.3 billion. Average deposits increased $548 million to $25.2 billion and period-end deposits were relatively consistent with the prior quarter.
  • The Company repurchased 250,000 shares at an average price of $80.50 per share.

Commercial Banking

  • Contributed $106.9 million to net income, an increase of $20.8 million over the prior quarter. Net interest revenue increased by $34.0 million, primarily driven by the allocation of acquired loans to the business lines. Fee revenue increased $3.1 million, while operating expense increased $12.8 million.
  • Average loans grew by $347 million, excluding the allocation of acquired loans in the second quarter. Average deposits increased $226 million.

Consumer Banking

  • Contributed $16.3 million to net income, an increase of $1.0 million compared to the first quarter. Net interest revenue increased $1.6 million, fee revenue increased $6.0 million and operating expense increased $3.9 million.
  • The recent decrease in mortgage interest rates has spurred mortgage origination activity in the second quarter. Mortgage production volume increased $197 million to $810 million and gain on sale margin increased 18 basis points to 1.46 percent.

Wealth Management

  • Contributed $25.5 million to net income, an increase of $1.8 million compared to the prior quarter. While net interest revenue decreased slightly, fees and commissions revenue increased $12.7 million largely due to an increase in brokerage and trading revenue. Operating expense increased $7.9 million.
  • Assets under management or administration were $81.8 billion at June 30, 2019 compared to $78.9 billion at March 31, 2019. Fiduciary assets totaled $49.3 billion at June 30, 2019 and $46.4 billion at March 31, 2019.

Net Interest Revenue

Net interest revenue was $285.4 million for the second quarter of 2019, a $7.3 million increase over the first quarter of 2019. Recoveries of foregone interest on non-accruing loans added $3.4 million. The second quarter of 2019 included $13.4 million of purchase accounting discount accretion while the first quarter of 2019 included $7.8 million.

Net interest margin was 3.30 percent, consistent with the previous quarter. The recovery of foregone interest and increase in loan discount accretion added approximately 10 basis points to net interest margin in the second quarter. Excluding these items, the yield on average earning assets was 4.31 percent, a 6 basis point decrease while the yield on the loan portfolio was 5.09 percent, down 2 basis points. The yield on the available for sale securities portfolio increased 6 basis points to 2.63 percent. The yield on the trading securities portfolio, which moves with long term interest rates because it turns over rapidly, was down 29 basis points.

Funding costs were 1.70 percent, up 4 basis points. The cost of interest-bearing deposits increased 9 basis points to 1.13 percent. The cost of other borrowed funds was down 1 basis point to 2.53 percent. The benefit to net interest margin from assets funded by non-interest liabilities was relatively unchanged at 49 basis points.

Average earning assets increased $933 million compared to the first quarter of 2019. Average available for sale securities increased $553 million. Average loan balances were up $238 million. Average fair value option securities balances increased $304 million. Average trading securities balances decreased $211 million. Average interest-bearing deposit balances increased $652 million and average borrowed funds increased $169 million compared to the first quarter of 2019.

Fees and Commissions Revenue

Fees and commissions revenue totaled $176.1 million for the second quarter of 2019, an increase of $15.6 million over the first quarter of 2019.

Lower mortgage interest rates have positively affected both our brokerage and trading and mortgage banking revenue. Brokerage and trading revenue increased $8.9 million due to increased trading volumes. Mortgage banking revenue increased $4.3 million due to a $197 million increase in production volume and an 18 basis point increase in gain on sale margin.

Fiduciary and asset management revenue increased $1.7 million over the first quarter of 2019, primarily due to seasonal tax fees collected in the second quarter. Transaction card revenue increased $1.2 million due to increased transaction volume.

Operating Expense

Total operating expense was $277.1 million for the second quarter of 2019, a decrease of $10.0 million compared to the first quarter of 2019. The first quarter of 2019 included $12.7 million of CoBiz integration costs. The following discussion excludes the impact of these costs.

Personnel expense decreased $5.6 million. CoBiz system integration was completed near the end of the first quarter which enabled us to fully realize expected operating efficiencies related to the acquisition. Regular compensation decreased $1.8 million while incentive compensation expense decreased $1.7 million. Employee benefits also decreased $2.0 million.

Non-personnel expense increased $8.3 million. Business promotion expense increased $2.9 million, primarily due to advertising expenses related to marketing our BOK Financial brand in the Colorado and Arizona markets. Insurance expense is up $1.9 million largely due to adjustments to deposit insurance expense related to the CoBiz integration. Increases in professional fees and services of $1.7 million and mortgage banking costs of $1.6 million were partially offset by a decrease in net losses and expenses of repossessed assets of $1.4 million. In addition, a $1.0 million cash charitable donation was made to the BOKF Foundation in the second quarter.

Loans, Deposits and Capital

Loans

Outstanding loans were $22.3 billion at June 30, 2019, up $497 million over March 31, 2019, largely related to growth in commercial and commercial real estate balances.

Outstanding commercial loan balances grew by $375 million or 3 percent over March 31, 2019. Energy loan balances were up $216 million. Wholesale/retail sector loans increased $86 million. Other commercial and industrial loans increased $28 million and services sector loans increased by $22 million.

Commercial real estate loan balances increased $109 million or 2 percent compared to March 31, 2019 due to our strong ongoing commitment volume. Loans secured by multifamily residential properties increased $90 million. Loans secured by industrial properties increased $61 million. Loans secured by office buildings increased $23 million. This growth was partially offset by a $65 million decrease in retail facilities.

Deposits

Period-end deposits totaled $25.3 billion at June 30, 2019, a $27 million decrease compared to March 31, 2019. Demand deposit balances decreased $429 million. Interest-bearing transaction account balances grew by $375 million. Time deposit balances increased by $30 million. Average deposits were $25.2 billion at June 30, 2019, an increase of $548 million compared to March 31, 2019. Total interest-bearing deposits increased $652 million partially offset by a decrease in demand deposits of $104 million.

Capital

The company's common equity Tier 1 capital ratio was 10.84 percent at June 30, 2019. In addition, the company's Tier 1 capital ratio was 10.84 percent, total capital ratio was 12.34 percent, and leverage ratio was 8.75 percent at June 30, 2019. At March 31, 2019, the company's common equity Tier 1 capital ratio was 10.71 percent, Tier 1 capital ratio was 10.71 percent, total capital ratio was 12.24 percent, and leverage ratio was 8.76 percent.

The company's tangible common equity ratio, a non-GAAP measure, was 8.69 percent at June 30, 2019 and 8.64 percent at March 31, 2019. 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 $297 million or 1.33 percent of outstanding loans and repossessed assets at June 30, 2019, compared to $262 million or 1.20 percent at March 31, 2019. Nonperforming assets that are not guaranteed by U.S. government agencies totaled $194 million or 0.88 percent of outstanding loans and repossessed assets at June 30, 2019, compared to $163 million or 0.75 percent at March 31, 2019.

Nonaccruing loans were $184 million or 0.83 percent of outstanding loans at June 30, 2019. Nonaccruing commercial loans totaled $123 million or 0.86 percent of outstanding commercial loans. Nonaccruing commercial real estate loans totaled $22 million or 0.46 percent of outstanding commercial real estate loans. Nonaccruing residential mortgage loans totaled $38 million or 1.77 percent of outstanding residential mortgage loans.

Nonaccruing loans increased $31 million from March 31, 2019, primarily due to a $36 million increase in energy loans. Healthcare sector loans decreased $2.6 million. New nonaccruing loans identified in the second quarter totaled $54 million, offset by $7.1 million in payments received and $13 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 $161 million at June 30, compared to $169 million at March 31. The decrease was primarily due to energy and manufacturing loans, partially offset by an increase in other commercial and industrial loans and loans secured by multifamily commercial real estate.

Net charge-offs were $7.7 million or 0.14 percent of average loans on an annualized basis for the second quarter of 2019, compared to $10.1 million or 0.19 percent of average loans on an annualized basis for the first quarter of 2019. Net charge-offs were 0.20 percent of average loans over the last four quarters. Gross charge-offs were $13.2 million for the second quarter compared to $11.8 million for the previous quarter. Recoveries totaled $5.5 million for the second quarter of 2019 and $1.7 million for the first quarter of 2019.

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 a $5.0 million provision for credit losses was appropriate for the second quarter of 2019. The company recorded an $8.0 million provision for credit losses in the first quarter of 2019.

The combined allowance for credit losses totaled $204 million or 0.92 percent of outstanding loans and 115 percent of nonaccruing loans at June 30, 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 1.03 percent of outstanding loans and 126 percent of nonaccruing loans at June 30, 2019 compared to 1.09 percent of outstanding loans and 159 percent of nonaccruing loans at March 31, 2019. The allowance for loan losses was $203 million and the accrual for off-balance sheet credit losses was $1.9 million. At March 31, 2019, the combined allowance for credit losses was $207 million or 0.95 percent of outstanding loans and 142 percent of nonaccruing loans, excluding loans guaranteed by U.S. government agencies. The allowance for loan losses was $205 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 $10.5 billion at June 30, 2019, a $1.5 billion increase compared to March 31, 2019. At June 30, 2019, the available for sale securities portfolio consisted primarily of $7.4 billion of residential mortgage-backed securities fully backed by U.S. government agencies and $3.1 billion of commercial mortgage-backed securities fully backed by U.S. government agencies. At June 30, 2019, the available for sale securities portfolio had a net unrealized gain of $132 million compared to a $2.6 million net unrealized loss at March 31, 2019.

Trading securities decreased $240 million to $1.9 billion during the second 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. This portfolio of fair value option securities increased $431 million to $1.1 billion at June 30, 2019.

The net economic cost of the changes in fair value of mortgage servicing rights and related economic hedges was $7.3 million during the second quarter of 2019, including a $29.6 million decrease in the fair value of mortgage servicing rights, a $21.0 million increase in the fair value of securities and derivative contracts held as an economic hedge, and $1.3 million of related net interest revenue.

Commercial Banking

Net income for Commercial Banking was $106.9 million for the second quarter of 2019, an increase of $20.8 million over the first quarter of 2019. Net interest revenue increased $34.0 million largely as a result of the allocation of acquired loans to the business line during the second quarter.

Excluding acquired loans and deposits, average loans increased $347 million or 2 percent while average customer deposits increased $226 million or 2 percent. We continue to see a shift in the deposit mix from demand deposit balances to interest bearing deposit balances.

Fees and commissions revenue increased $3.1 million, primarily due to an increase in loan syndication fees based on the timing of completed transactions and increased transaction card revenues related to a seasonal increase in transaction volume. Operating expense increased $12.8 million primarily due to an increase in personnel expenses as a result of the allocation of CoBiz personnel to the business line.

Consumer Banking

Net income from Consumer Banking was $16.3 million in the second quarter of 2019, an increase of $1.0 million.

Net interest revenue from Consumer Banking activities increased $1.6 million largely due to an increase in interest earned on the fair value option portfolio combined with increased deposits sold to our Funds Management unit. Average loans increased $46 million or 3 percent and average deposits increased $454 million or 7 percent.

Revenues from mortgage banking activities increased $4.3 million over the prior quarter due to lower interest rates. Mortgage production volume increased $197 million or 32 percent and the gain on sale margin climbed to 1.46 percent from 1.28 percent. Deposit service charges also increased $1.1 million due to two more days in the quarter compared to the previous quarter.

Operating expenses increased $3.9 million, nearly all related to non-personnel expenses. Mortgage banking costs increased $1.6 million related to increased payoffs as mortgage interest rates declined during the quarter. Business promotion expense increased $1.6 million primarily due to additional brand marketing.

Wealth Management

Net income for Wealth Management increased $1.8 million to $25.5 million during the second quarter of 2019. An increase in brokerage and trading revenue was partially offset by a decrease in net interest revenue and an increase in operating expenses.

Brokerage and trading revenue increased $8.4 million due to an increase in trading activity and volumes as a result of favorable interest rate changes. This increase was partially offset by a decrease in interest received on trading securities and an increase in funding costs. Fiduciary and asset management revenue increased $3.4 million largely due to a seasonal increase related to tax fees collected in the second quarter as well as increased assets under management. Operating expenses increased $7.9 million, including $6.1 million related to personnel expenses and $1.9 million related to other operating expenses.

Average loans increased $199 million to $1.6 billion. Average deposits increased $561 million to $6.2 billion, primarily due to an increase in interest-bearing transaction account balances. Assets under management or administration were $81.8 billion at June 30, 2019 compared to $78.9 billion at March 31, 2019. Fiduciary assets totaled $49.3 billion at June 30, 2019 and $46.4 billion at March 31, 2019.

Conference Call and Webcast

The company will hold a conference call at 9 a.m. Central time on Wednesday, July 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 # 13692252.

About BOK Financial Corporation

BOK Financial Corporation is a $42 billion regional financial services company headquartered in Tulsa, Oklahoma with $82 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 June 30, 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)
  June 30, 2019   Mar. 31, 2019
ASSETS      
Cash and due from banks $ 739,109     $ 718,297  
Interest-bearing cash and cash equivalents 596,382     564,404  
Trading securities 1,900,395     2,140,326  
Investment securities 327,677     331,466  
Available for sale securities 10,514,414     9,025,198  
Fair value option securities 1,138,819     707,994  
Restricted equity securities 461,017     376,429  
Residential mortgage loans held for sale 193,570     160,157  
Loans:      
Commercial 14,336,908     13,961,975  
Commercial real estate 4,710,033     4,600,651  
Residential mortgage 2,170,822     2,192,620  
Personal 1,037,889     1,003,734  
Total loans 22,255,652     21,758,980  
Allowance for loan losses (202,534 )   (205,340 )
Loans, net of allowance 22,053,118     21,553,640  
Premises and equipment, net 468,368     468,293  
Receivables 213,608     224,887  
Goodwill 1,048,091     1,048,091  
Intangible assets, net 124,473     129,482  
Mortgage servicing rights 208,308     238,193  
Real estate and other repossessed assets, net 16,940     17,139  
Derivative contracts, net 415,221     359,223  
Cash surrender value of bank-owned life insurance 384,193     384,174  
Receivable on unsettled securities sales 583,421     966,455  
Other assets 505,949     469,114  
TOTAL ASSETS $ 41,893,073     $ 39,882,962  
       
LIABILITIES AND EQUITY      
Deposits:      
Demand $ 9,667,557     $ 10,096,552  
Interest-bearing transaction 12,851,943     12,476,977  
Savings 557,683     559,884  
Time 2,227,938     2,198,389  
Total deposits 25,305,121     25,331,802  
Funds purchased and repurchase agreements 2,331,947     1,439,673  
Other borrowings 7,823,809     7,341,093  
Subordinated debentures 275,892     275,880  
Accrued interest, taxes and expense 181,413     173,434  
Due on unsettled securities purchases 565,268     186,401  
Derivative contracts, net 381,454     299,698  
Other liabilities 309,694     303,272  
TOTAL LIABILITIES 37,174,598     35,351,253  
Shareholders' equity:      
Capital, surplus and retained earnings 4,610,869     4,526,404  
Accumulated other comprehensive gain (loss) 98,569     (3,531 )
TOTAL SHAREHOLDERS' EQUITY 4,709,438     4,522,873  
Non-controlling interests 9,037     8,836  
TOTAL EQUITY 4,718,475     4,531,709  
TOTAL LIABILITIES AND EQUITY $ 41,893,073     $ 39,882,962  


 
AVERAGE BALANCE SHEETS -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands)
  Three Months Ended
  June 30, 2019   Mar. 31, 2019   Dec. 31, 2018   Sept. 30, 2018   June 30, 2018
ASSETS                  
Interest-bearing cash and cash equivalents $ 535,491     $ 537,903     $ 563,132     $ 688,872     $ 1,673,387  
Trading securities 1,757,335     1,968,399     1,929,601     1,762,794     1,482,302  
Investment securities 328,482     343,282     364,737     379,566     399,088  
Available for sale securities 9,435,668     8,883,054     8,704,963     8,129,214     8,163,142  
Fair value option securities 898,772     594,349     277,575     469,398     487,192  
Restricted equity securities 413,812     395,432     362,729     328,842     348,546  
Residential mortgage loans held for sale 192,102     145,040     179,553     207,488     218,600  
Loans:                  
Commercial 14,175,057     13,966,521     13,587,344     11,484,200     11,189,899  
Commercial real estate 4,656,861     4,602,149     4,747,784     3,774,470     3,660,166  
Residential mortgage 2,146,315     2,193,334     2,222,063     1,956,089     1,915,015  
Personal 1,026,172     1,004,061     1,022,140     989,026     986,162  
Total loans 22,004,405     21,766,065     21,579,331     18,203,785     17,751,242  
Allowance for loan losses (205,532 )   (206,092 )   (209,613 )   (214,160 )   (222,856 )
Total loans, net 21,798,873     21,559,973     21,369,718     17,989,625     17,528,386  
Total earning assets 35,360,535     34,427,432     33,752,008     29,955,799     30,300,643  
Cash and due from banks 703,294     705,411     731,700     578,905     571,333  
Derivative contracts, net 328,802     262,927     299,319     294,126     318,375  
Cash surrender value of bank-owned life insurance 384,974     382,538     379,893     322,038     319,507  
Receivable on unsettled securities sales 1,437,462     1,224,700     799,548     768,785     618,240  
Other assets 2,629,710     2,669,673     2,423,275     1,776,164     1,777,937  
TOTAL ASSETS $ 40,844,777     $ 39,672,681     $ 38,385,743     $ 33,695,817     $ 33,906,035  
                   
LIABILITIES AND EQUITY                  
Deposits:                  
Demand $ 9,883,965     $ 9,988,088     $ 10,648,683     $ 9,325,002     $ 9,223,327  
Interest-bearing transaction 12,512,282     11,931,539     11,773,651     10,010,031     10,189,354  
Savings 558,738     541,575     526,275     503,821     503,671  
Time 2,207,391     2,153,277     2,146,786     2,097,441     2,138,880  
Total deposits 25,162,376     24,614,479     25,095,395     21,936,295     22,055,232  
Funds purchased and repurchase agreements 2,066,950     2,033,036     1,205,568     1,193,583     593,250  
Other borrowings 7,175,617     7,040,279     6,361,141     5,765,440     6,497,020  
Subordinated debentures 275,887     275,882     276,378     144,702     144,692  
Derivative contracts, net 283,484     273,786     268,848     185,029     235,543  
Due on unsettled securities purchases 821,688     453,937     493,887     544,263     527,804  
Other liabilities 460,732     501,788     341,438     311,605     340,322  
TOTAL LIABILITIES 36,246,734     35,193,187     34,042,655     30,080,917     30,393,863  
Total equity 4,598,043     4,479,494     4,343,088     3,614,900     3,512,172  
TOTAL LIABILITIES AND EQUITY $ 40,844,777     $ 39,672,681     $ 38,385,743     $ 33,695,817     $ 33,906,035  


 
STATEMENTS OF EARNINGS -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands, except per share data)
  Three Months Ended   Six Months Ended
  June 30,   June 30,
  2019   2018   2019   2018
               
Interest revenue $ 390,820     $ 294,180     $ 766,894     $ 559,587  
Interest expense 105,388     55,618     203,360     101,289  
Net interest revenue 285,432     238,562     563,534     458,298  
Provision for credit losses 5,000         13,000     (5,000 )
Net interest revenue after provision for credit losses 280,432     238,562     550,534     463,298  
Other operating revenue:              
Brokerage and trading revenue 40,526     26,488     72,143     57,136  
Transaction card revenue 21,915     20,975     42,653     41,965  
Fiduciary and asset management revenue 45,025     41,692     88,383     83,524  
Deposit service charges and fees 28,074     27,834     56,317     54,994  
Mortgage banking revenue 28,131     26,346     51,965     52,371  
Other revenue 12,437     13,923     25,199     26,882  
Total fees and commissions 176,108     157,258     336,660     316,872  
Other gains, net 3,480     4,578     6,456     3,286  
Gain (loss) on derivatives, net 11,150     (3,057 )   15,817     (8,742 )
Gain (loss) on fair value option securities, net 9,853     (3,341 )   19,518     (20,905 )
Change in fair value of mortgage servicing rights (29,555 )   1,723     (50,221 )   22,929  
Gain (loss) on available for sale securities, net 1,029     (762 )   1,105     (1,052 )
Total other operating revenue 172,065     156,399     329,335     312,388  
Other operating expense:              
Personnel 160,342     138,947     329,570     278,894  
Business promotion 10,142     7,686     18,016     13,696  
Charitable contributions to BOKF Foundation 1,000         1,000      
Professional fees and services 13,002     14,978     29,141     25,178  
Net occupancy and equipment 26,880     22,761     56,401     46,807  
Insurance 6,454     6,245     11,293     12,838  
Data processing and communications 29,735     27,739     61,184     55,556  
Printing, postage and supplies 4,107     4,011     8,992     8,100  
Net losses and operating expenses of repossessed assets 580     2,722     2,576     10,427  
Amortization of intangible assets 5,138     1,386     10,329     2,686  
Mortgage banking costs 11,545     12,890     21,451     23,039  
Other expense 8,212     7,111     14,341     13,685  
Total other operating expense 277,137     246,476     564,294     490,906  
               
Net income before taxes 175,360     148,485     315,575     284,780  
Federal and state income taxes 37,580     33,330     67,530     64,278  
               
Net income 137,780     115,155     248,045     220,502  
Net gain (loss) attributable to non-controlling interests 217     783     (130 )   568  
Net income attributable to BOK Financial Corporation shareholders $ 137,563     $ 114,372     $ 248,175     $ 219,934  
               
Average shares outstanding:              
Basic 70,887,063     64,901,975     71,135,414     64,874,567  
Diluted 70,902,033     64,937,226     71,151,558     64,912,552  
               
Net income per share:              
Basic $ 1.93     $ 1.75     $ 3.47     $ 3.36  
Diluted $ 1.93     $ 1.75     $ 3.46     $ 3.36  


 
FINANCIAL HIGHLIGHTS -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands, except ratio and share data)
  Three Months Ended
  June 30, 2019   Mar. 31, 2019   Dec. 31, 2018   Sept. 30, 2018   June 30, 2018
Capital:                  
Period-end shareholders' equity $ 4,709,438     $ 4,522,873     $ 4,432,109     $ 3,615,032     $ 3,553,431  
Risk weighted assets $ 32,040,741     $ 31,601,558     $ 30,742,295     $ 27,398,072     $ 27,004,559  
Risk-based capital ratios:                  
Common equity tier 1 10.84 %   10.71 %   10.92 %   12.07 %   11.92 %
Tier 1 10.84 %   10.71 %   10.92 %   12.07 %   11.92 %
Total capital 12.34 %   12.24 %   12.50 %   13.37 %   13.26 %
Leverage ratio 8.75 %   8.76 %   8.96 %   9.90 %   9.57 %
Tangible common equity ratio1 8.69 %   8.64 %   8.82 %   9.55 %   9.21 %
                   
Common stock:                  
Book value per share $ 66.15     $ 63.30     $ 61.45     $ 55.25     $ 54.30  
Tangible book value per share 49.68     46.82     45.03     47.90     46.95  
Market value per share:                  
High $ 88.17     $ 93.72     $ 98.29     $ 105.22     $ 106.65  
Low $ 72.60     $ 72.11     $ 69.96     $ 92.40     $ 92.39  
Cash dividends paid $ 35,631     $ 35,885     $ 35,977     $ 32,591     $ 29,340  
Dividend payout ratio 25.90 %   32.44 %   33.17 %   27.79 %   25.65 %
Shares outstanding, net 71,198,270     71,449,982     72,122,932     65,434,258     65,439,090  
Stock buy-back program:                  
Shares repurchased 250,000     705,609     525,000         8,257  
Amount $ 20,125     $ 60,577     $ 45,057     $     $ 824  
Average price per share $ 80.50     $ 85.85     $ 85.82     $     $ 99.84  
                   
Performance ratios (quarter annualized):
Return on average assets 1.35 %   1.13 %   1.12 %   1.38 %   1.35 %
Return on average equity 12.02 %   10.04 %   9.93 %   12.95 %   13.14 %
Net interest margin 3.30 %   3.30 %   3.40 %   3.21 %   3.17 %
Efficiency ratio 59.51 %   64.80 %   63.25 %   61.60 %   61.77 %
                   
Reconciliation of non-GAAP measures:
1  Tangible common equity ratio:                  
Total shareholders' equity $ 4,709,438     $ 4,522,873     $ 4,432,109     $ 3,615,032     $ 3,553,431  
Less: Goodwill and intangible assets, net 1,172,564     1,177,573     1,184,112     480,800     481,366  
Tangible common equity $ 3,536,874     $ 3,345,300     $ 3,247,997     $ 3,134,232     $ 3,072,065  
                   
Total assets $ 41,893,073     $ 39,882,962     $ 38,020,504     $ 33,289,864     $ 33,833,107  
Less: Goodwill and intangible assets, net 1,172,564     1,177,573     1,184,112     480,800     481,366  
Tangible assets $ 40,720,509     $ 38,705,389     $ 36,836,392     $ 32,809,064     $ 33,351,741  
                   
Tangible common equity ratio 8.69 %   8.64 %   8.82 %   9.55 %   9.21 %
                   
                   
                                       
FINANCIAL HIGHLIGHTS -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands, except ratio and share data)
  Three Months Ended  
  June 30, 2019   Mar. 31, 2019   Dec. 31, 2018   Sept. 30, 2018   June 30, 2018
                                       
Other data:                                      
Tax equivalent interest $ 3,481     $ 2,529     $ 3,067     $ 1,894     $ 1,983  
Net unrealized gain (loss) on available for sale securities $ 131,780     $ (2,609 )   $ (95,271 )   $ (216,793 )   $ (180,602 )
                                       
Mortgage banking:                                      
Mortgage production revenue $ 11,869     $ 7,868     $ 5,073     $ 7,250     $ 9,915  
                                       
Mortgage loans funded for sale $ 729,841     $ 510,527     $ 497,353     $ 651,076     $ 773,910  
Add: current period-end outstanding commitments 344,087     263,434     160,848     197,752     251,231  
Less: prior period end outstanding commitments 263,434     160,848     197,752     251,231     298,318  
Total mortgage production volume $ 810,494     $ 613,113     $ 460,449     $ 597,597     $ 726,823  
                   
Mortgage loan refinances to mortgage loans funded for sale 31 %   30 %   23 %   23 %   22 %
Gain on sale margin 1.46 %   1.28 %   1.10 %   1.21 %   1.36 %
                   
Mortgage servicing revenue $ 16,262     $ 15,966     $ 16,807     $ 16,286     $ 16,431  
Average outstanding principal balance of mortgage loans serviced for others 21,418,690     21,581,835     21,706,541     21,895,041     21,986,065  
Average mortgage servicing revenue rates 0.30 %   0.30 %   0.31 %   0.30 %   0.30 %
                   
Gain (loss) on mortgage servicing rights, net of economic hedge:
Gain (loss) on mortgage hedge derivative contracts, net $ 11,128     $ 4,432     $ 12,162     $ (2,843 )   $ (3,070 )
Gain (loss) on fair value option securities, net 9,853     9,665     (282 )   (4,385 )   (3,341 )
Gain (loss) on economic hedge of mortgage servicing rights 20,981     14,097     11,880     (7,228 )   (6,411 )
Gain (loss) on changes in fair value of mortgage servicing rights (29,555 )   (20,666 )   (24,233 )   5,972     1,723  
Loss on changes in fair value of mortgage servicing rights, net of economic hedges, included in other operating revenue (8,574 )   (6,569 )   (12,353 )   (1,256 )   (4,688 )
Net interest revenue on fair value option securities2 1,296     1,129     695     1,100     1,203  
Total economic cost of changes in the fair value of mortgage servicing rights, net of economic hedges $ (7,278 )   $ (5,440 )   $ (11,658 )   $ (156 )   $ (3,485 )

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
  June 30, 2019   Mar. 31, 2019   Dec. 31, 2018   Sept. 30, 2018   June 30, 2018
                   
Interest revenue $ 390,820     $ 376,074     $ 365,592     $ 303,247     $ 294,180  
Interest expense 105,388     97,972     79,906     62,364     55,618  
Net interest revenue 285,432     278,102     285,686     240,883     238,562  
Provision for credit losses 5,000     8,000     9,000     4,000      
Net interest revenue after provision for credit losses 280,432     270,102     276,686     236,883     238,562  
Other operating revenue:                  
Brokerage and trading revenue 40,526     31,617     28,101     23,086     26,488  
Transaction card revenue 21,915     20,738     20,664     21,396     20,975  
Fiduciary and asset management revenue 45,025     43,358     43,665     57,514     41,692  
Deposit service charges and fees 28,074     28,243     29,393     27,765     27,834  
Mortgage banking revenue 28,131     23,834     21,880     23,536     26,346  
Other revenue 12,437     12,762     16,404     12,900     13,923  
Total fees and commissions 176,108     160,552     160,107     166,197     157,258  
Other gains (losses), net 3,480     2,976     (8,305 )   2,754     4,578  
Gain (loss) on derivatives, net 11,150     4,667     11,167     (2,847 )   (3,057 )
Gain (loss) on fair value option securities, net 9,853     9,665     (282 )   (4,385 )   (3,341 )
Change in fair value of mortgage servicing rights (29,555 )   (20,666 )   (24,233 )   5,972     1,723  
Gain (loss) on available for sale securities, net 1,029     76     (1,999 )   250     (762 )
Total other operating revenue 172,065     157,270     136,455     167,941     156,399  
Other operating expense:                  
Personnel 160,342     169,228     160,706     143,531     138,947  
Business promotion 10,142     7,874     9,207     7,620     7,686  
Charitable contributions to BOKF Foundation 1,000         2,846          
Professional fees and services 13,002     16,139     20,712     13,209     14,978  
Net occupancy and equipment 26,880     29,521     27,780     23,394     22,761  
Insurance 6,454     4,839     4,248     6,232     6,245  
Data processing and communications 29,735     31,449     27,575     31,665     27,739  
Printing, postage and supplies 4,107     4,885     5,232     3,837     4,011  
Net losses and operating expenses of repossessed assets 580     1,996     2,581     4,044     2,722  
Amortization of intangible assets 5,138     5,191     5,331     1,603     1,386  
Mortgage banking costs 11,545     9,906     11,518     11,741     12,890  
Other expense 8,212     6,129     6,907     5,741     7,111  
Total other operating expense 277,137     287,157     284,643     252,617     246,476  
Net income before taxes 175,360     140,215     128,498     152,207     148,485  
Federal and state income taxes 37,580     29,950     20,121     34,662     33,330  
Net income 137,780     110,265     108,377     117,545     115,155  
Net income (loss) attributable to non-controlling interests 217     (347 )   (79 )   289     783  
Net income attributable to BOK Financial Corporation shareholders $ 137,563     $ 110,612     $ 108,456     $ 117,256     $ 114,372  
                   
Average shares outstanding:                  
Basic 70,887,063     71,387,070     71,808,029     64,901,095     64,901,975  
Diluted 70,902,033     71,404,388     71,833,334     64,934,351     64,937,226  
Net income per share:                  
Basic $ 1.93     $ 1.54     $ 1.50     $ 1.79     $ 1.75  
Diluted $ 1.93     $ 1.54     $ 1.50     $ 1.79     $ 1.75  


 
LOANS TREND -- UNAUDITED
BOK FINANCIAL CORPORATION
(In thousands)
    June 30, 2019   Mar. 31, 2019   Dec. 31, 2018   Sept. 30, 2018   June 30, 2018
Commercial:                    
Energy   $ 3,921,353     $ 3,705,099     $ 3,590,333     $ 3,294,867     $ 3,147,219  
Services   3,309,458     3,287,563     3,258,192     2,603,862     2,516,676  
Healthcare   2,926,510     2,915,885     2,799,277     2,437,323     2,353,722  
Wholesale/retail   1,793,118     1,706,900     1,621,158     1,650,729     1,699,554  
Public finance   795,659     803,083     804,550     418,578     433,408  
Manufacturing   761,357     742,374     730,521     660,582     647,816  
Other commercial and industrial   829,453     801,071     832,047     510,160     550,644  
Total commercial   14,336,908     13,961,975     13,636,078     11,576,101     11,349,039  
                     
Commercial real estate:                    
Multifamily   1,300,372     1,210,358     1,288,065     1,120,166     1,056,984  
Office   1,056,306     1,033,158     1,072,920     824,829     820,127  
Retail   825,399     890,685     919,082     759,423     768,024  
Industrial   828,569     767,757     778,106     696,774     653,384  
Residential construction and land development   141,509     149,686     148,584     101,872     118,999  
Other commercial real estate   557,878     549,007     558,056     301,611     294,702  
Total commercial real estate   4,710,033     4,600,651     4,764,813     3,804,675     3,712,220  
                     
Residential mortgage:                    
Permanent mortgage   1,088,370     1,098,481     1,122,610     1,094,926     1,068,412  
Permanent mortgages guaranteed by U.S. government agencies   195,373     193,308     190,866     180,718     169,653  
Home equity   887,079     900,831     916,557     696,098     704,185  
Total residential mortgage   2,170,822     2,192,620     2,230,033     1,971,742     1,942,250  
                     
Personal   1,037,889     1,003,734     1,025,806     996,941     1,000,187  
                     
Total   $ 22,255,652     $ 21,758,980     $ 21,656,730     $ 18,349,459     $ 18,003,696  


 
LOANS BY PRINCIPAL MARKET AREA -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands)
  June 30, 2019   Mar. 31, 2019   Dec. 31, 2018   Sept. 30, 2018   June 30, 2018
                   
Oklahoma:                  
Commercial $ 3,762,234     $ 3,551,054     $ 3,491,117     $ 3,609,109     $ 3,465,407  
Commercial real estate 717,970     665,190     700,756     651,315     662,665  
Residential mortgage 1,403,398     1,417,381     1,440,566     1,429,843     1,403,658  
Personal 382,764     374,807     375,543     376,201     362,846  
Total Oklahoma 6,266,366     6,008,432     6,007,982     6,066,468     5,894,576  
                   
Texas:                  
Commercial 5,877,265     5,754,018     5,438,133     5,115,646     4,922,451  
Commercial real estate 1,341,609     1,344,810     1,341,783     1,354,679     1,336,101  
Residential mortgage 272,878     265,927     266,805     253,265     243,400  
Personal 400,585     396,794     394,743     381,452     394,021  
Total Texas 7,892,337     7,761,549     7,441,464     7,105,042     6,895,973  
                   
New Mexico:                  
Commercial 350,520     342,915     340,489     325,048     305,167  
Commercial real estate 385,058     371,416     383,670     392,494     386,878  
Residential mortgage 82,390     85,326     87,346     88,110     90,581  
Personal 10,236     11,065     10,662     11,659     11,107  
Total New Mexico 828,204     810,722     822,167     817,311     793,733  
                   
Arkansas:                  
Commercial 87,896     79,286     111,338     102,237     93,217  
Commercial real estate 149,300     142,551     141,898     106,701     90,807  
Residential mortgage 7,463     7,731     7,537     7,278     6,927  
Personal 11,208     11,550     11,955     12,126     12,331  
Total Arkansas 255,867     241,118     272,728     228,342     203,282  
                   
Colorado:                  
Commercial 2,325,742     2,231,703     2,275,069     1,132,500     1,165,721  
Commercial real estate 1,023,410     957,348     963,575     354,543     267,065  
Residential mortgage 241,780     241,722     251,849     68,694     64,839  
Personal 72,537     65,812     72,916     56,999     60,504  
Total Colorado 3,663,469     3,496,585     3,563,409     1,612,736     1,558,129  
                   
Arizona:                  
Commercial 1,330,415     1,335,140     1,320,139     621,658     681,852  
Commercial real estate 761,243     791,466     889,903     666,562     710,784  
Residential mortgage 91,684     98,973     97,959     44,659     47,010  
Personal 76,335     61,875     68,546     67,280     65,541  
Total Arizona 2,259,677     2,287,454     2,376,547     1,400,159     1,505,187  
                   
Kansas/Missouri:                  
Commercial 602,836     667,859     659,793     669,903     715,224  
Commercial real estate 331,443     327,870     343,228     278,381     257,920  
Residential mortgage 71,229     75,560     77,971     79,893     85,835  
Personal 84,224     81,831     91,441     91,224     93,837  
Total Kansas/Missouri 1,089,732     1,153,120     1,172,433     1,119,401     1,152,816  
                   
TOTAL BOK FINANCIAL $ 22,255,652     $ 21,758,980     $ 21,656,730     $ 18,349,459     $ 18,003,696  

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, 2019   Mar. 31, 2019   Dec. 31, 2018   Sept. 30, 2018   June 30, 2018
Oklahoma:                  
  Demand $ 3,279,359     $ 3,432,239     $ 3,610,593     $ 3,564,307     $ 3,867,934  
  Interest-bearing:                  
  Transaction 7,020,484     6,542,548     6,445,831     6,010,972     5,968,459  
  Savings 307,785     309,875     288,210     288,080     289,202  
  Time 1,253,804     1,217,371     1,118,643     1,128,810     1,207,471  
  Total interest-bearing 8,582,073     8,069,794     7,852,684     7,427,862     7,465,132  
Total Oklahoma 11,861,432     11,502,033     11,463,277     10,992,169     11,333,066  
                   
Texas:                  
  Demand 2,974,005     2,966,743     3,291,433     3,357,669     3,321,980  
  Interest-bearing:                  
  Transaction 2,453,619     2,385,305     2,295,169     2,182,114     2,169,155  
  Savings 103,125     101,849     99,624     97,909     97,809  
  Time 425,253     419,269     423,880     453,119     445,500  
  Total interest-bearing 2,981,997     2,906,423     2,818,673     2,733,142     2,712,464  
Total Texas 5,956,002     5,873,166     6,110,106     6,090,811     6,034,444  
                   
New Mexico:                  
  Demand 630,861     662,362     691,692     722,188     770,974  
  Interest-bearing:                  
  Transaction 557,881     573,203     571,347     593,760     586,593  
  Savings 62,636     61,497     58,194     57,794     59,415  
  Time 232,569     228,212     224,515     221,513     212,689  
  Total interest-bearing 853,086     862,912     854,056     873,067     858,697  
Total New Mexico 1,483,947     1,525,274     1,545,748     1,595,255     1,629,671  
                   
Arkansas:                  
  Demand 29,176     31,624     36,800     36,579     39,896  
  Interest-bearing:                  
  Transaction 148,485     147,964     91,593     128,001     143,298  
  Savings 1,783     1,785     1,632     1,826     1,885  
  Time 7,810     8,321     8,726     10,214     10,771  
  Total interest-bearing 158,078     158,070     101,951     140,041     155,954  
Total Arkansas 187,254     189,694     138,751     176,620     195,850  
                   
Colorado:                  
  Demand 1,621,820     1,897,547     1,658,473     593,442     529,912  
  Interest-bearing:                  
  Transaction 1,800,271     1,844,632     1,899,203     622,520     701,362  
  Savings 57,263     58,919     57,289     40,308     38,176  
  Time 246,198     261,235     274,877     217,628     208,049  
  Total interest-bearing 2,103,732     2,164,786     2,231,369     880,456     947,587  
Total Colorado 3,725,552     4,062,333     3,889,842     1,473,898     1,477,499  
                   
Arizona:                  
  Demand 700,480     695,238     707,402     365,878     383,627  
  Interest-bearing:                  
  Transaction 560,429     621,735     575,567     130,105     193,687  
  Savings 11,966     12,144     10,545     3,559     3,935  
  Time 43,099     44,004     43,051     23,927     22,447  
  Total interest-bearing 615,494     677,883     629,163     157,591     220,069  
Total Arizona 1,315,974     1,373,121     1,336,565     523,469     603,696  
                   
Kansas/Missouri:                  
  Demand 431,856     410,799     418,199     423,560     459,636  
  Interest-bearing:                  
  Transaction 310,774     361,590     327,866     322,747     401,545  
  Savings 13,125     13,815     13,721     13,125     13,052  
  Time 19,205     19,977     19,688     20,635     20,805  
  Total interest-bearing 343,104     395,382     361,275     356,507     435,402  
Total Kansas/Missouri 774,960     806,181     779,474     780,067     895,038  
                   
TOTAL BOK FINANCIAL $ 25,305,121     $ 25,331,802     $ 25,263,763     $ 21,632,289     $ 22,169,264  


 
NET INTEREST MARGIN TREND -- UNAUDITED
BOK FINANCIAL CORPORATION
  Three Months Ended
  June 30, 2019   Mar. 31, 2019   Dec. 31, 2018   Sept. 30, 2018   June 30, 2018
                   
TAX-EQUIVALENT ASSETS YIELDS                  
Interest-bearing cash and cash equivalents 2.57 %   2.56 %   2.23 %   1.98 %   1.86 %
Trading securities 3.59 %   3.88 %   4.10 %   3.98 %   3.63 %
Investment securities 4.41 %   4.50 %   4.26 %   4.06 %   3.95 %
Available for sale securities 2.63 %   2.57 %   2.51 %   2.37 %   2.30 %
Fair value option securities 3.34 %   3.62 %   3.56 %   3.25 %   3.16 %
Restricted equity securities 6.30 %   6.42 %   6.39 %   6.36 %   6.21 %
Residential mortgage loans held for sale 3.65 %   4.58 %   4.00 %   4.27 %   4.28 %
Loans 5.39 %   5.26 %   5.09 %   4.80 %   4.80 %
Allowance for loan losses                  
Loans, net of allowance 5.45 %   5.31 %   5.14 %   4.86 %   4.86 %
Total tax-equivalent yield on earning assets 4.51 %   4.46 %   4.33 %   4.04 %   3.91 %
                   
COST OF INTEREST-BEARING LIABILITIES                
Interest-bearing deposits:                  
  Interest-bearing transaction 1.04 %   0.94 %   0.79 %   0.67 %   0.55 %
  Savings 0.12 %   0.12 %   0.11 %   0.09 %   0.08 %
  Time 1.90 %   1.80 %   1.54 %   1.40 %   1.29 %
Total interest-bearing deposits 1.13 %   1.04 %   0.87 %   0.77 %   0.66 %
Funds purchased and repurchase agreements 2.08 %   2.07 %   1.36 %   1.25 %   0.53 %
Other borrowings 2.67 %   2.68 %   2.51 %   2.20 %   1.96 %
Subordinated debt 5.53 %   5.51 %   5.38 %   5.55 %   5.67 %
Total cost of interest-bearing liabilities 1.70 %   1.66 %   1.42 %   1.25 %   1.11 %
Tax-equivalent net interest revenue spread 2.81 %   2.80 %   2.91 %   2.79 %   2.80 %
Effect of noninterest-bearing funding sources and other 0.49 %   0.50 %   0.49 %   0.42 %   0.37 %
Tax-equivalent net interest margin 3.30 %   3.30 %   3.40 %   3.21 %   3.17 %

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
  June 30, 2019   Mar. 31, 2019   Dec. 31, 2018   Sept. 30, 2018   June 30, 2018
Nonperforming assets:                  
Nonaccruing loans:                  
Commercial $ 123,395     $ 90,358     $ 99,841     $ 109,490     $ 120,978  
Commercial real estate 21,670     21,508     21,621     1,316     1,996  
Residential mortgage 38,477     40,409     41,555     41,917     42,343  
Personal 237     302     230     269     340  
Total nonaccruing loans 183,779     152,577     163,247     152,992     165,657  
Accruing renegotiated loans guaranteed by U.S. government agencies 95,989     91,787     86,428     83,347     75,374  
Real estate and other repossessed assets 16,940     17,139     17,487     24,515     27,891  
Total nonperforming assets $ 296,708     $ 261,503     $ 267,162     $ 260,854     $ 268,922  
Total nonperforming assets excluding those guaranteed by U.S. government agencies $ 193,976     $ 162,770     $ 173,602     $ 169,717     $ 185,981  
                   
Nonaccruing loans by loan class:                  
Commercial:                  
Energy $ 71,632     $ 35,332     $ 47,494     $ 54,033     $ 65,597  
Services 10,087     9,555     8,567     4,097     4,377  
Healthcare 16,148     18,768     16,538     15,704     16,125  
Manufacturing 8,613     9,548     8,919     9,202     2,991  
Wholesale/retail 1,390     1,425     1,316     9,249     14,095  
Public finance                  
Other commercial and industrial 15,525     15,730     17,007     17,205     17,793  
Total commercial 123,395     90,358     99,841     109,490     120,978  
Commercial real estate:                  
Retail 20,057     20,159     20,279     777     1,068  
Residential construction and land development 350     350     350     350     350  
Multifamily 275         301          
Office 855     855             275  
Industrial                  
Other commercial real estate 133     144     691     189     303  
Total commercial real estate 21,670     21,508     21,621     1,316     1,996  
Residential mortgage:                  
Permanent mortgage 21,803     22,937     23,951     22,855     23,105  
Permanent mortgage guaranteed by U.S. government agencies 6,743     6,946     7,132     7,790     7,567  
Home equity 9,931     10,526     10,472     11,272     11,671  
Total residential mortgage 38,477     40,409     41,555     41,917     42,343  
Personal 237     302     230     269     340  
Total nonaccruing loans $ 183,779     $ 152,577     $ 163,247     $ 152,992     $ 165,657  
                   
Performing loans 90 days past due1 $ 2,698     $ 610     $ 1,338     $ 518     $ 879  
                                       
Gross charge-offs $ 13,227     $ 11,775     $ 14,515     $ 11,073     $ 15,105  
Recoveries   (5,503 )     (1,689 )     (2,168 )     (2,092 )     (4,578 )
Net charge-offs $ 7,724     $ 10,086     $ 12,347     $ 8,981     $ 10,527  
                                       
Provision for credit losses $ 5,000     $ 8,000     $ 9,000     $ 4,000     $  
                   
Allowance for loan losses to period end loans 0.91 %   0.94 %   0.96 %   1.15 %   1.19 %
Combined allowance for credit losses to period end loans 0.92 %   0.95 %   0.97 %   1.16 %   1.21 %
Nonperforming assets to period end loans and repossessed assets 1.33 %   1.20 %   1.23 %   1.42 %   1.49 %
Net charge-offs (annualized) to average loans 0.14 %   0.19 %   0.23 %   0.20 %   0.24 %
Allowance for loan losses to nonaccruing loans1 114.40 %   141.00 %   132.89 %   145.02 %   136.09 %
Combined allowance for credit losses to nonaccruing loans1 115.48 %   142.25 %   134.03 %   146.41 %   137.63 %

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   June 30, 2019   Mar. 31, 2019   June 30, 2018   2Q19 vs
1Q19
  2Q19 vs
2Q18
Net interest revenue   $ 185,610     $ 151,648     $ 145,025     22.4 %   28.0 %
Fees and commissions revenue   41,105     38,046     42,874     8.0 %   (4.1 )%
Other operating expense   62,947     50,177     49,386     25.4 %   27.5 %
Corporate expense allocations   11,384     10,148     9,366     12.2 %   21.5 %
Net income   106,932     86,143     87,577     24.1 %   22.1 %
                     
Average assets   22,910,071     19,936,895     18,072,155     14.9 %   26.8 %
Average loans   18,812,800     15,988,843     14,900,918     17.7 %   26.3 %
Average deposits   10,724,206     8,261,543     8,379,584     29.8 %   28.0 %
                     
Consumer Banking                    
Net interest revenue   $ 52,717     $ 51,102     $ 39,295     3.2 %   34.2 %
Fees and commissions revenue   48,830     42,821     46,332     14.0 %   5.4 %
Other operating expense   57,694     53,821     61,146     7.2 %   (5.6 )%
Corporate expense allocations   11,695     11,900     11,042     (1.7 )%   5.9 %
Net income   16,344     15,337     5,793     6.6 %   182.1 %
                     
Average assets   9,212,667     8,371,683     8,353,558     10.0 %   10.3 %
Average loans   1,796,823     1,750,642     1,716,259     2.6 %   4.7 %
Average deposits   6,998,677     6,544,665     6,579,635     6.9 %   6.4 %
                     
Wealth Management                    
Net interest revenue   $ 26,943     $ 28,256     $ 28,986     (4.6 )%   (7.0 )%
Fees and commissions revenue   85,925     73,256     70,489     17.3 %   21.9 %
Other operating expense   69,452     61,507     61,491     12.9 %   12.9 %
Corporate expense allocations   9,168     8,360     11,142     9.7 %   (17.7 )%
Net income   25,545     23,719     20,119     7.7 %   27.0 %
                     
Average assets   9,849,396     9,328,986     8,495,557     5.6 %   15.9 %
Average loans   1,647,680     1,448,718     1,413,170     13.7 %   16.6 %
Average deposits   6,220,848     5,659,771     5,834,669     9.9 %   6.6 %
Fiduciary assets   49,296,896     46,401,149     46,531,900     6.2 %   5.9 %
Assets under management or administration   81,774,602     78,852,284     78,873,446     3.7 %   3.7 %

Acquired assets and liabilities were allocated to segments in the second quarter of 2019.

Contact:
Cody McAlester
+1 918-295-0486
cmcalester@bokf.com

Is your business listed correctly on America’s largest city directory network of 1,000 portals?