BOK Financial Reports Quarterly Earnings of $87 Million
BOK Financial Reports Quarterly Earnings of $87 Million
Mortgage Banking Revenue Drives Results; Company Declares Special Dividend
Business Wire
TULSA, Okla. -- October 31, 2012
BOK Financial Corporation reported net income of $87.4 million or $1.27 per
diluted share for the third quarter of 2012, compared to net income of $97.6
million or $1.43 per diluted share for the second quarter of 2012 and net
income of $85.1 million or $1.24 per diluted share for the third quarter of
2011. A gain on the sale of common stock received in settlement of a defaulted
loan and a negative provision for credit losses increased net income by $14
million or $0.21 per diluted share in the second quarter of 2012.
Net income for the nine months ended September 30, 2012 totaled $268.6 million
or $3.92 per diluted share compared to $218.9 million or $3.19 per diluted
share for the nine months ended September 30, 2011.
“BOK Financial's strong financial results for the third quarter continue to
reflect the strength of our diversified revenue business model,” said
President and CEO Stan Lybarger. “The prolonged low interest rate environment
has enabled our mortgage banking professionals to assist a record number of
customers in the purchase or refinance of their home. We experienced strong
commercial loan growth and continued growth in our deposit base. We are also
very pleased to welcome The Milestone Group to BOK Financial. The Milestone
Group is a Denver-based registered investment adviser which provides wealth
management services to high net worth clients in Colorado and Nebraska."
Highlights of third quarter of 2012 included:
* Net interest revenue totaled $176.0 million for the third quarter of 2012
compared to $181.4 million for the second quarter of 2012. Net interest
margin was 3.12% for the third quarter of 2012 and 3.30% for the second
quarter of 2012. The yield on our securities portfolio continued to
decline as cash flows are reinvested at lower rates. In addition, net
interest revenue for the second quarter of 2012 included $2.9 million from
the full recovery of a nonaccruing commercial loan. Excluding this
recovery, net interest margin for the second quarter was 3.25%.
* Fees and commissions revenue totaled $166.3 million, up $11.9 million or
8% over the second quarter of 2012. Mortgage banking revenue increased
$10.7 million due to record mortgage loan production volumes and improved
pricing of loans sold.
* Operating expenses, excluding changes in the fair value of mortgage
servicing rights, totaled $212.8 million, up $1.2 million or less than 1%
over the previous quarter. Personnel expense increased $478 thousand.
Non-personnel expense increased $725 thousand.
* No provision for credit losses was recorded in the third quarter of 2012
compared to an $8.0 million negative provision for credit losses in the
second quarter of 2012. Net charge-offs totaled $5.7 million or 0.19% of
average loans on an annualized basis in the third quarter of 2012 compared
to net charge-offs of $4.8 million or 0.17% of average loans on an
annualized basis in the second quarter of 2012. Gross charge-offs continue
to decline, down $2.6 million from the previous quarter. Third quarter
recoveries were reduced by $7.1 million due to the refund of a settlement
between BOK Financial and the City of Tulsa.
* The combined allowance for credit losses totaled $236 million or 1.99% of
outstanding loans at September 30, 2012 compared to $241 million or 2.09%
of outstanding loans at June 30, 2012. Nonperforming assets totaled $264
million or 2.21% of outstanding loans and repossessed assets at
September 30, 2012 and $279 million or 2.38% of outstanding loans and
repossessed assets at June 30, 2012.
* Outstanding loan balances were $11.8 billion at September 30, 2012, up
$256 million over the prior quarter. Commercial loan balances grew by $221
million or 13% on an annualized basis over June 30, 2012. Commercial real
estate loans grew by $39 million and residential mortgage loans grew by
$14 million, partially offset by an $18 million decrease in consumer
loans.
* Available for sale securities grew by $1.1 billion during the third
quarter to $11.5 billion at September 30, 2012. The Company increased its
holdings of short-duration U.S. government guaranteed residential
mortgage-backed securities during the third quarter.
* Period end deposits totaled $19.1 billion at September 30, 2012 compared
to $18.4 billion at June 30, 2012. Interest-bearing transaction accounts
increased $451 million and demand deposit accounts increased $408 million,
partially offset by an $86 million decrease in time deposits.
* Tangible common equity ratio was 9.67% at September 30, 2012 and 10.07% at
June 30, 2012. The tangible common equity ratio is a non-GAAP measure of
capital strength used by the Company and investors based on shareholders'
equity minus intangible assets and equity that does not benefit common
shareholders. The Company and its subsidiary bank continue to exceed the
regulatory definition of well capitalized. The Company's Tier 1 capital
ratios, as defined by banking regulations, were 13.21% at September 30,
2012 and 13.62% at June 30, 2012.
* The Company paid a cash dividend of $26 million or $0.38 per common share
during the third quarter of 2012. On October 30, 2012, the board of
directors approved a quarterly cash dividend of $0.38 per common share
payable on or about November 30, 2012 to shareholders of record as of
November 16, 2012.
* On October 30, 2012, the board of directors also approved a special cash
dividend of $1.00 per common share payable on or about November 30, 2012
to shareholders of record as of November 16, 2012.
Net Interest Revenue
Net interest revenue decreased $5.3 million compared to the second quarter of
2012. Net interest margin was 3.12% for the third quarter of 2012 compared to
3.30% for the second quarter of 2012. Net interest revenue for the second
quarter included $2.9 million from the full recovery of a nonaccruing
commercial loan. Excluding this interest recovery, net interest margin was
3.25% for the second quarter of 2012.
The yield on average earning assets decreased 22 basis points compared to the
prior quarter. The available for sale securities portfolio yield decreased 16
basis points to 2.38% due primarily to the continued reinvestment of cash
flows from the portfolio at lower current rates. The loan portfolio yield
decreased by 15 basis points to 4.33%, excluding the impact of the previously
noted interest recovery in the second quarter. The loan yield decrease was
largely due to renewals of maturing fixed-rate loans at current lower rates
and narrowing credit spreads in this prolonged low interest rate environment,
and a reduction in fees recognized when loans prepay. The cost of
interest-bearing liabilities decreased 4 basis points from the previous
quarter to 0.52%. The average rate of interest paid on subordinated debentures
decreased to 2.79% in the third quarter of 2012 compared to 3.95% in the
second quarter of 2012. The interest rate on $233 million of these
subordinated debentures converted from a fixed interest rate of 5.75% to a
floating interest rate based on LIBOR plus 0.69% during the second quarter.
Average earning assets increased $1.2 billion during the third quarter of
2012. The average balance of the available for sale securities portfolio
increased $967 million over the second quarter of 2012 due primarily to growth
in residential and commercial mortgage-backed securities issued by U.S.
government agencies. Average outstanding loans increased $125 million due
primarily to a $140 million increase in commercial loan balances. The average
balance of residential mortgage loans held for sale increased $73 million over
the second quarter of 2012 due to increased origination volumes.
Average deposits increased $325 million over the previous quarter. Demand
deposit balances were up $440 million. Time deposit account balances decreased
$63 million and interest-bearing transaction account balances decreased $60
million. In addition, average balances of borrowed funds decreased $34 million
compared to the second quarter of 2012.
Fees and Commissions Revenue
Fees and commissions revenue totaled $166.3 million, up $11.9 million over the
second quarter of 2012 due primarily to a $10.7 million increase in mortgage
banking revenue.
Growth in mortgage banking revenue was due to record mortgage loan production
volumes and improved pricing of loans sold. Residential mortgage loans funded
for sale totaled $1.0 billion for the third quarter of 2012, up $205 million
or 24% over the previous quarter. Refinanced mortgage loans were 61% of loans
originated for sale in the third quarter of 2012 compared to 51% of the loans
originated for sale in the second quarter of 2012. Growth in mortgage loan
production volume was stimulated by continued low primary mortgage interest
rates and government programs that encourage refinancing. In addition to
growth in loans funded, outstanding mortgage loan commitments at September 30,
2012 were up $60 million or 15% over June 30, 2012. Mortgage banking revenue
also increased due to improved pricing of loans sold which resulted from
government actions to reduce secondary market interest rates. Average
secondary market rates for the third quarter of 2012 decreased nearly 50 basis
points compared to the previous quarter.
Other sources of fees and commissions revenue were up modestly over the
previous quarter. Transaction card revenue increased $1.0 million due
primarily to an increase in the number of transactions processed by our
TransFund electronic funds transfer network and for merchant services clients.
Brokerage and trading revenue was down $1.3 million. Growth in securities
trading and customer hedging revenue was partially offset by decreased retail
brokerage and investment banking fees. Securities trading revenue increased
$2.9 million. Excluding the impact of a $2.9 million recovery of derivative
contract losses from the 2008 Lehman Brothers bankruptcy during the second
quarter of 2012, customer hedging revenue increased $673 thousand. Retail
brokerage revenue decreased $1.4 million and investment banking revenues
decreased $577 thousand. Trust fees and commissions revenue and deposit
service charges and fees were largely unchanged compared to the second quarter
of 2012.
Operating Expenses
Total operating expenses were $222.3 million for the third quarter of 2012
compared to $223.0 million for the second quarter of 2012. Excluding changes
in the fair value of mortgage servicing rights, operating expenses totaled
$212.8 million, up $1.2 million over the second quarter of 2012.
Personnel costs increased $478 thousand over the second quarter of 2012.
Regular compensation expense was up $1.5 million primarily due to increases in
personnel headcount. Incentive compensation expense decreased $1.3 million.
Stock-based incentive compensation expense decreased $4.1 million primarily
due to the timing of accruals for the BOK Financial Corporation True-Up Plan,
which provides incentive compensation for certain senior executives based on
earnings per share performance and compensation of comparable senior
executives at peer banks. Cash-based incentive compensation, which rewards
employees as they generate business opportunities for the Company by growing
loans, deposits, customer relationships or other measurable metrics, increased
$2.8 million.
Non-personnel expense increased $725 thousand over the second quarter of 2012.
Data processing and communications expense increased $1.2 million primarily
due to impairment charges on two discontinued software projects. Net losses
and operating expenses on repossessed properties were down $206 thousand
compared to the second quarter of 2012. All other expenses were down $291
thousand from the second quarter of 2012.
Loans, Deposits and Capital
Loans
Outstanding loans at September 30, 2012 were $11.8 billion, up $256 million
over June 30, 2012. Growth in commercial, commercial real estate and
residential mortgage loans was partially offset by a decrease in consumer
loans.
Outstanding commercial loan balances grew by $221 million or 13% on an
annualized basis over June 30, 2012. Outstanding balances were up in most
geographic markets, including $115 million in Texas, $43 million in Oklahoma,
$31 million in Kansas/Missouri and $22 million in Arizona. Energy sector loans
increased $155 million, growing primarily in the Texas and Colorado markets.
Wholesale/retail sector loans increased $119 million primarily in the Oklahoma
and Texas markets. Service sector loans were down $40 million compared to June
30, 2012 primarily in the Oklahoma market and other commercial and industrial
sector loans decreased $39 million primarily in the Texas market. Unfunded
energy loan commitments increased $76 million during the third quarter to $2.2
billion. All other unfunded commercial loan commitments totaled $3.2 billion
at September 30, 2012, up slightly from June 30, 2012.
Commercial real estate loans were up $39 million over June 30, 2012. Loans
secured by multifamily residential properties increased $36 million primarily
related to loans in the Texas market. Loans secured by retail facilities grew
by $33 million primarily related to loans in the Oklahoma market. Loans
secured by office buildings were up $22 million primarily in the Oklahoma and
Texas markets. Growth in these loan classes was partially offset by a $44
million decrease in loans secured by industrial properties, primarily in the
Texas and Oklahoma markets. Unfunded commercial real estate loan commitments
totaled $574 million at September 30, 2012, up $40 million over June 30, 2012.
Residential mortgage loans increased $14 million over June 30, 2012. Home
equity loans increased $19 million. Growth was primarily in first-lien, fully
amortizing home equity loans. Non-guaranteed permanent mortgage loans
decreased $6.9 million and permanent mortgage loans guaranteed by U.S.
government agencies increased $1.3 million.
Consumer loans decreased $18 million from June 30, 2012, primarily due to
continued runoff of indirect automobile loans related to the previously
announced decision to curtail that business in favor of a customer-focused
direct approach to consumer lending. Approximately $47 million of indirect
automobile loans remain outstanding at September 30, 2012.
Deposits
Deposits totaled $19.1 billion at September 30, 2012 compared to $18.4 billion
at June 30, 2012. Demand deposit balances increased $408 million.
Interest-bearing transaction account balances increased $451 million and time
deposits decreased $86 million. Among the lines of business, commercial
deposits increased $623 million, wealth management deposits increased $210
million and consumer deposits increased $17 million. Commercial and
industrial, treasury services, commercial real estate, energy and small
business customer account balances all increased over the prior quarter.
Commercial customers continue to maintain high account balances due to
continued economic uncertainty and persistently low yields available on high
quality investment alternatives.
The Dodd-Frank Wall Street Reform and Consumer Protection Act temporarily
provided unlimited deposit insurance coverage for noninterest-bearing
transaction accounts at all FDIC-insured institutions. Although an extension
is currently being considered, this temporary program is set to expire on
December 31, 2012. Upon expiration, noninterest-bearing transaction accounts
will be insured only up to $250,000. The impact of the expiration of this
temporary program is uncertain, but could result in a decrease in average
demand deposit balances held by customers.
Capital
The Company and its subsidiary bank exceeded the regulatory definition of well
capitalized at September 30, 2012. The Company's Tier 1 capital ratio was
13.21% at September 30, 2012 and 13.62% at June 30, 2012. The total capital
ratio was 15.71% at September 30, 2012 and 16.19% at June 30, 2012. In
addition, the Company's tangible common equity ratio, a non-GAAP measure, was
9.67% at September 30, 2012 and 10.07% at June 30, 2012. Unrealized securities
gains added 54 basis points to the tangible common equity ratio at
September 30, 2012. The decrease in Tier 1, total and tangible common equity
ratios was largely due to asset growth. In each case, capital used to
calculate these ratios at September 30 exceeded June 30.
In June, banking regulators issued a Notice of Proposed Rulemaking that will
incorporate Basel III capital changes for substantially all U.S. banking
organizations. If adopted as proposed, these changes will establish a 7%
threshold for the Tier 1 common equity ratio consisting of a minimum level
plus a capital conservation buffer. BOK Financial's Tier 1 common equity ratio
based on the existing Basel I standards was 13.01% as of September 30, 2012.
Our estimated Tier 1 common equity ratio under a fully phased in Basel III
framework is approximately 12.35%, nearly 535 basis points above the 7%
regulatory threshold. This estimate is subject to interpretation of rules that
are not yet final. Additionally, the proposed definition of Tier 1 common
equity includes unrealized gains and losses on available for sale securities
which will vary based on market conditions.
Credit Quality
Nonperforming assets decreased $15 million during the third quarter of 2012 to
$264 million or 2.21% of outstanding loans and repossessed assets at
September 30, 2012. Nonaccruing loans decreased $13 million and real estate
and other repossessed assets decreased $1.6 million. Accruing renegotiated
loans, largely consisting of residential mortgage loans guaranteed by U.S.
government agencies, decreased $423 thousand.
During the third quarter of 2012, the Office of the Comptroller of the
Currency issued interpretive guidance regarding accounting for and
classification of retail loans to borrowers who have filed for Chapter 7
bankruptcy. This guidance states that these loans should be charged-down to
collateral value and classified as nonaccruing and troubled debt
restructurings, regardless of current payment status. Generally, we have been
complying with this guidance by charging down such loans to collateral value
within 60 days of being notified of the borrower's bankruptcy filing. Based on
available information we do not expect implementation to significantly affect
charge-offs or provision for credit losses. We estimate that nonaccruing loans
and troubled debt restructuring may increase by $10 million to $15 million. At
September 30, 2012, payments on approximately 89% of loans that may be
classified as nonaccruing are current. We expect to implement this guidance in
the fourth quarter.
Nonaccruing loans totaled $132 million or 1.11% of outstanding loans at
September 30, 2012 and $144 million or 1.25% of outstanding loans at June 30,
2012. During the third quarter of 2012, $20 million of new nonaccruing loans
were identified, offset by $18 million in payments received, $8.9 million in
charge-offs and $7.0 million in foreclosures and repossessions.
Nonaccruing commercial loans decreased to $22 million or 0.30% of outstanding
commercial loans at September 30, 2012 from $35 million or 0.49% of
outstanding commercial loans at June 30, 2012. The decrease was due primarily
to the repayment of a $9.5 million manufacturing sector loan in the Oklahoma
market. The Company also received a $1.8 million partial recovery of amounts
previously charged off on this loan. Nonaccruing commercial real estate loans
decreased to $76 million or 3.50% of outstanding commercial real estate loans
at September 30, 2012 from $80 million or 3.77% of outstanding commercial real
estate loans at June 30, 2012. Nonaccruing commercial real estate loans
consist primarily of land development and residential construction loans.
Nonaccruing land development and residential construction loans totaled $38
million or 13.17% of all land development and construction loans at
September 30, 2012, a decrease of $7.9 million from June 30, 2012.
Nonaccruing residential mortgage loans increased $6.5 million during the third
quarter of 2012 to $29 million or 1.45% of outstanding residential mortgage
loans. Principally all non-guaranteed residential mortgage loans past due 90
days or more are nonaccruing. Residential mortgage loans past due 30 to 89
days and still accruing interest, excluding loans guaranteed by U.S.
government agencies, totaled $21 million at September 30, 2012 and $17 million
at June 30, 2012.
The combined allowance for credit losses totaled $236 million or 1.99% of
outstanding loans and 178.70% of nonaccruing loans at September 30, 2012. The
allowance for loan losses was $234 million and the accrual for off-balance
sheet credit losses was $1.9 million. Gross charge-offs continue to decrease,
totaling $8.9 million for the third quarter, compared to $11.5 million for the
previous quarter. Recoveries of $10.3 million during the third quarter were
partially offset by the return of $7.1 million received from the City of Tulsa
in 2008 to settle claims related to a defaulted loan. The settlement agreement
between BOK Financial and the City of Tulsa was invalidated by the Oklahoma
Supreme Court in 2011. Recoveries totaled $6.7 million for the second quarter
of 2012. Net charge-offs totaled $5.7 million or 0.19% on an annualized basis
for the third quarter of 2012 compared with net charge-offs of $4.8 million or
0.17% on an annualized basis for the second quarter of 2012.
After evaluating all credit factors, no provision for credit losses was
necessary during the third quarter of 2012. The previously noted recovery
refund was expected and had been accrued in prior periods. Net recoveries
recorded during the quarter offset an increase in required reserves due to
loan portfolio growth. Credit quality indicators and most economic factors are
stable or improving in our primary markets.
Real estate and other repossessed assets totaled $104 million at September 30,
2012, primarily consisting of $40 million of 1-4 family residential properties
(including $23 million guaranteed by U.S. government agencies), $29 million of
developed commercial real estate properties, $21 million of undeveloped land
and $12 million of residential land and land development properties. The
distribution of real estate owned and other repossessed assets among various
markets included $29 million attributed to Arizona, $20 million attributed to
New Mexico, $19 million attributed to Texas and $14 million attributed to
Oklahoma. Real estate and other repossessed assets decreased by $1.6 million
during the third quarter of 2012. Additions of $41 million were partially
offset by $38 million of sales. Additions included $23 million and sales
included $21 million of 1-4 family residential properties guaranteed by U.S.
government agencies. Write-downs and net losses on sales of real estate and
other repossessed assets totaled $3.6 million.
The Company also has off-balance sheet credit risk related to residential
mortgage loans sold prior to 2008 to U.S. government agencies under various
community development programs with full recourse for the life of the loans.
The outstanding principal balance of these loans decreased to $238 million at
September 30, 2012 from $241 million at June 30, 2012. The loans are primarily
to borrowers in our market areas, including $167 million in Oklahoma. At
September 30, 2012, approximately 5% of these loans are nonperforming and 6%
were past due 30 to 89 days. A separate accrual for credit risk of $18 million
is available to absorb losses on these loans.
Securities and Derivatives
The fair value of the available for sale securities portfolio totaled $11.5
billion at September 30, 2012 and $10.4 billion at June 30, 2012. The increase
came primarily in short-duration U.S. government agency residential
mortgage-backed securities and U.S. government agency commercial
mortgage-backed securities. At September 30, 2012, the available for sale
portfolio consisted primarily of $10.7 billion of residential mortgage-backed
securities fully backed by U.S. government agencies, $339 million of
commercial mortgage-backed securities fully backed by U.S. government
agencies, and $332 million privately issued by publicly owned financial
institutions. Privately issued mortgage-backed securities included $208
million backed by Jumbo-A residential mortgage loans and $124 million backed
by Alt-A residential mortgage loans. Net unamortized premiums are less than 1%
of the securities portfolio amortized cost.
Net unrealized gains on available for sale securities totaled $281 million at
September 30, 2012 and $242 million at June 30, 2012. Net unrealized gains on
residential mortgage-backed securities issued by U.S. government agencies
increased $2.0 million during the second quarter to $274 million at
September 30, 2012. Net unrealized losses on privately issued residential
mortgage-backed securities totaled $5.3 million at September 30, 2012 and $36
million at June 30, 2012.
The amortized cost of privately issued residential mortgage-backed securities
totaled $337 million at September 30, 2012, down $17 million since June 30,
2012. All of these securities are rated below investment grade by at least one
nationally-recognized rating agency. The amortized cost of these securities
was reduced during the third quarter of 2012 by $16 million of cash payments
received and $1.1 million of credit-related impairment charges during the
quarter.
In the third quarter of 2012, the Company recognized net gains of $8.0 million
from sales of $209 million of available for sale securities. These securities
were sold either because they had reached their expected maximum potential
total return or to mitigate exposure to prepayment risk. Net gains from sales
of available for sale securities totaled $20.5 million in the second quarter
of 2012 and included a gain of $14.2 million from the sale of $26 million of
stock received in settlement of a defaulted loan.
The Company also maintains a portfolio of residential mortgage-backed
securities issued by U.S. government agencies and interest rate derivative
contracts designated as an economic hedge of the changes in the fair value of
our mortgage servicing rights. Residential mortgage interest rates decreased
during the third quarter of 2012, causing prepayment speeds to increase and
the value of our mortgage servicing rights to decrease by $9.6 million. This
decrease was partially offset by a $6.1 million increase in the value of
securities and interest rate derivative contracts held as an economic hedge.
About BOK Financial Corporation
BOK Financial is a $27 billion regional financial services company based in
Tulsa, Oklahoma. The Company's stock is publicly traded on NASDAQ under the
Global Select market listings (symbol: BOKF). BOK Financial's holdings include
BOKF, NA, BOSC, Inc. and Cavanal Hill Investment Management, Inc. BOKF, NA
operates the TransFund electronic funds network and seven banking divisions:
Bank of Albuquerque, Bank of Arizona, Bank of Arkansas, Bank of Kansas City,
Bank of Oklahoma, Bank of Texas and Colorado State Bank and Trust. Through its
subsidiaries, the Company provides commercial and consumer banking, investment
and trust services, mortgage origination and servicing, and an electronic
funds transfer network. For more information, visit www.bokf.com.
The Company will continue to evaluate critical assumptions and estimates, such
as the adequacy of the allowance for credit losses and asset impairment as of
September 30, 2012 through the date its financial statements are filed with
the Securities and Exchange Commission and will adjust amounts reported if
necessary.
This news release contains forward-looking statements that are based on
management's beliefs, assumptions, current expectations, estimates and
projections about BOK Financial, the financial services industry and the
economy generally. Words such as “anticipates,” “believes,” “estimates,”
“expects,” “forecasts,” “plans,” “projects,” variations of such words and
similar expressions are intended to identify such forward-looking statements.
Management judgments relating to and discussion of the provision and allowance
for credit losses involve judgments as to future events and are inherently
forward-looking statements. Assessments that BOK Financial's acquisitions and
other growth endeavors will be profitable are necessary statements of belief
as to the outcome of future events based in part on information provided by
others which BOK Financial has not independently verified. These statements
are not guarantees of future performance and involve certain risks,
uncertainties, and assumptions which are difficult to predict with regard to
timing, extent, likelihood and degree of occurrence. Therefore, actual results
and outcomes may materially differ from what is expected, implied or
forecasted in such forward-looking statements. Internal and external factors
that might cause such a difference include, but are not limited to (1) the
ability to fully realize expected cost savings from mergers within the
expected time frames, (2) the ability of other companies on which BOK
Financial relies to provide goods and services in a timely and accurate
manner, (3) changes in interest rates and interest rate relationships, (4)
demand for products and services, (5) the degree of competition by traditional
and nontraditional competitors, (6) changes in banking regulations, tax laws,
prices, levies and assessments, (7) the impact of technological advances and
(8) trends in consumer behavior as well as their ability to repay loans. BOK
Financial and its affiliates undertake no obligation to update, amend or
clarify forward-looking statements, whether as a result of new information,
future events, or otherwise.
BALANCE SHEETS -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands)
September 30, June 30, September 30,
2012 2012 2011
ASSETS
Cash and due from $ 596,590 $ 628,092 $ 953,688
banks
Funds sold and 18,904 11,171 19,193
resell agreements
Trading securities 204,242 149,317 109,659
Investment 432,114 412,479 452,652
securities
Available for sale 11,506,434 10,395,415 9,619,631
securities
Fair value option 331,887 325,177 672,191
securities
Residential mortgage 325,102 259,174 256,397
loans held for sale
Loans:
Commercial 7,273,217 7,052,544 6,421,602
Commercial real 2,165,526 2,126,214 2,272,833
estate
Residential mortgage 2,018,980 2,005,097 1,949,901
Consumer 374,644 392,576 480,233
Total loans 11,832,367 11,576,431 11,124,569
Less allowance for (233,756 ) (231,669 ) (271,456)
loan losses
Loans, net of 11,598,611 11,344,762 10,853,113
allowance
Premises and 259,195 261,508 264,325
equipment, net
Receivables 116,243 121,944 111,427
Goodwill 358,962 335,601 335,601
Intangible assets, 33,196 9,098 11,115
net
Mortgage servicing 89,653 91,783 87,948
rights, net
Real estate and
other repossessed 104,128 105,708 127,943
assets
Bankers' acceptances 1,605 2,873 211
Derivative contracts 435,653 366,204 370,616
Cash surrender value
of bank-owned life 271,830 269,093 260,506
insurance
Receivable on
unsettled securities 32,480 32,876 172,641
sales
Other assets 400,812 453,771 387,408
TOTAL ASSETS $ 27,117,641 $ 25,576,046 $ 25,066,265
LIABILITIES AND
EQUITY
Deposits:
Demand $ 6,848,401 $ 6,440,375 $ 5,414,284
Interest-bearing 9,002,567 8,551,874 9,252,837
transaction
Savings 269,573 261,998 217,431
Time 3,022,326 3,107,950 3,554,470
Total deposits 19,142,867 18,362,197 18,439,022
Funds purchased 1,680,626 1,453,750 1,318,668
Repurchase 1,109,696 1,136,948 1,206,793
agreements
Other borrowings 639,254 58,056 80,276
Subordinated 347,592 353,378 398,834
debentures
Accrued interest, 182,410 140,434 155,188
taxes, and expense
Bankers' acceptances 1,605 2,873 211
Due on unsettled 556,998 603,800 218,097
securities purchases
Derivative contracts 254,422 370,053 341,822
Other liabilities 189,696 171,836 139,804
TOTAL LIABILITIES 24,105,166 22,653,325 22,298,715
Shareholders'
equity:
Capital, surplus and 2,813,264 2,746,744 2,569,021
retained earnings
Accumulated other 162,393 139,190 163,571
comprehensive income
TOTAL SHAREHOLDERS' 2,975,657 2,885,934 2,732,592
EQUITY
Non-controlling 36,818 36,787 34,958
interest
TOTAL EQUITY 3,012,475 2,922,721 2,767,550
TOTAL LIABILITIES $ 27,117,641 $ 25,576,046 $ 25,066,265
AND EQUITY
AVERAGE BALANCE SHEETS -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands)
Three Months Ended
September 30, June 30, March 31, December 31, September 30,
2012 2012 2012 2011 2011
ASSETS
Funds sold and
resell $ 17,837 $ 19,187 $ 11,385 $ 12,035 $ 12,344
agreements
Trading 132,213 143,770 95,293 97,972 88,576
securities
Investment 408,646 416,284 430,890 443,326 329,627
securities
Available for 11,058,055 10,091,279 9,947,227 9,914,523 9,656,592
sale securities
Fair value
option 336,160 335,965 555,233 660,025 594,629
securities
Residential
mortgage loans 264,024 191,311 182,372 201,242 156,621
held for sale
Loans:
Commercial 7,216,232 7,075,871 6,882,277 6,502,981 6,329,136
Commercial real 2,148,559 2,133,247 2,198,832 2,256,153 2,208,757
estate
Residential 2,003,162 2,011,729 1,944,462 1,949,929 1,868,627
mortgage
Consumer 371,709 393,875 411,240 443,252 466,285
Total loans 11,739,662 11,614,722 11,436,811 11,152,315 10,872,805
Less allowance (231,177 ) (242,605 ) (252,538 ) (266,473 ) (285,570 )
for loan losses
Total loans, net 11,508,485 11,372,117 11,184,273 10,885,842 10,587,235
Total earning 23,725,420 22,569,913 22,406,673 22,214,965 21,425,624
assets
Cash and due 746,364 748,811 908,628 1,234,312 1,045,450
from banks
Cash surrender
value of 270,084 267,246 264,354 261,496 260,505
bank-owned life
insurance
Derivative 291,965 371,690 311,178 247,411 228,466
contracts
Other assets 1,554,339 1,580,857 1,625,750 1,679,256 1,661,693
TOTAL ASSETS $ 26,588,172 $ 25,538,517 $ 25,516,583 $ 25,637,440 $ 24,621,738
LIABILITIES AND
EQUITY
Deposits:
Demand $ 6,718,572 $ 6,278,342 $ 5,847,682 $ 5,588,596 $ 5,086,538
Interest-bearing 8,719,648 8,779,659 9,319,978 9,276,608 9,310,046
transaction
Savings 267,498 259,386 241,442 220,236 214,979
Time 3,068,870 3,132,220 3,246,362 3,485,059 3,617,731
Total deposits 18,774,588 18,449,607 18,655,464 18,570,499 18,229,294
Funds purchased 1,678,006 1,740,354 1,337,614 1,197,154 994,099
Repurchase 1,112,847 1,095,298 1,183,778 1,189,861 1,128,275
agreements
Other borrowings 97,003 86,667 72,911 88,489 128,288
Subordinated 352,432 357,609 397,440 398,858 398,812
debentures
Derivative 247,148 302,329 207,864 180,623 187,515
contracts
Other 1,379,495 637,920 826,279 1,241,469 817,049
liabilities
TOTAL 23,641,519 22,669,784 22,681,350 22,866,953 21,883,332
LIABILITIES
Total equity 2,946,653 2,868,733 2,835,233 2,770,487 2,738,406
TOTAL
LIABILITIES AND $ 26,588,172 $ 25,538,517 $ 25,516,583 $ 25,637,440 $ 24,621,738
EQUITY
STATEMENTS OF EARNINGS -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands, except per share data)
Three Months Ended Nine Months Ended
September September September September
30, 30, 30, 30,
2012 2011 2012 2011
Interest revenue $ 196,071 $ 205,749 $ 597,334 $ 613,555
Interest expense 20,044 30,365 66,377 93,531
Net interest revenue 176,027 175,384 530,957 520,024
Provision for credit — — (8,000 ) 8,950
losses
Net interest revenue
after provision for 176,027 175,384 538,957 511,074
credit losses
Other operating
revenue:
Brokerage and 31,261 29,451 94,972 78,552
trading revenue
Transaction card 27,788 31,328 79,976 90,797
revenue
Trust fees and 19,654 17,853 58,023 55,425
commissions
Deposit service 25,148 24,614 74,743 70,951
charges and fees
Mortgage banking 50,266 29,493 122,892 66,205
revenue
Bank-owned life 2,707 2,761 8,416 8,496
insurance
Other revenue 9,476 10,535 26,062 26,709
Total fees and 166,300 146,035 465,084 397,135
commissions
Gain (loss) on other 125 351 (341 ) 2,474
assets, net
Gain on derivatives, 464 4,048 336 2,860
net
Gain on fair value
option securities, 6,192 17,788 11,311 24,191
net
Gain on available
for sale securities, 7,967 16,694 32,779 27,064
net
Total
other-than-temporary — (9,467 ) (640 ) (9,541 )
impairment losses
Portion of loss
recognized in
(reclassified from) (1,104 ) (1,833 ) (5,044 ) (11,182 )
other comprehensive
income
Net impairment
losses recognized in (1,104 ) (11,300 ) (5,684 ) (20,723 )
earnings
Total other 179,944 173,616 503,485 433,001
operating revenue
Other operating
expense:
Personnel 122,775 103,260 359,841 308,857
Business promotion 6,054 5,280 17,188 14,681
Contribution to BOKF
Charitable — 4,000 — 4,000
Foundation
Professional fees 7,991 7,418 23,933 21,134
and services
Net occupancy and 16,914 16,627 49,843 47,785
equipment
Insurance 3,690 2,206 11,567 13,163
Data processing and 26,486 24,446 73,894 71,377
communications
Printing, postage 3,611 3,780 10,825 10,448
and supplies
Net losses and
operating expenses 5,706 5,939 13,863 17,813
of repossessed
assets
Amortization of 742 896 1,862 2,688
intangible assets
Mortgage banking 11,566 9,349 30,312 24,788
costs
Change in fair value
of mortgage 9,576 24,822 13,899 35,186
servicing rights
Other expense 7,229 12,512 20,460 29,120
Total other 222,340 220,535 627,487 601,040
operating expense
Net income before 133,631 128,465 414,955 343,035
taxes
Federal and state 45,778 43,006 144,447 121,115
income taxes
Net income 87,853 85,459 270,508 221,920
Net income
attributable to 471 358 1,882 3,038
non-controlling
interest
Net income
attributable to BOK
Financial $ 87,382 $ 85,101 $ 268,626 $ 218,882
Corporation
shareholders
Average shares
outstanding:
Basic 67,966,700 67,827,591 67,704,343 67,875,875
Diluted 68,334,989 68,037,419 67,981,558 68,127,754
Net income per
share:
Basic $ 1.28 $ 1.24 $ 3.94 $ 3.20
Diluted $ 1.27 $ 1.24 $ 3.92 $ 3.19
FINANCIAL HIGHLIGHTS -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands, except ratio and share data)
Three Months Ended
September 30, June 30, March 31, December 31, September 30,
2012 2012 2012 2011 2011
Capital:
Period-end
shareholders' $ 2,975,657 $ 2,885,934 $ 2,834,419 $ 2,750,468 $ 2,732,592
equity
Risk weighted $ 18,448,854 $ 17,758,118 $ 17,993,379 $ 17,291,105 $ 17,106,533
assets
Risk-based
capital ratios:
Tier 1 13.21 % 13.62 % 13.03 % 13.27 % 13.14 %
Total capital 15.71 % 16.19 % 16.16 % 16.49 % 16.54 %
Leverage ratio 9.34 % 9.64 % 9.35 % 9.15 % 9.37 %
Tangible common 9.67 % 10.07 % 9.75 % 9.56 % 9.65 %
equity ratio^1
Tier 1 common 13.01 % 13.41 % 12.83 % 13.06 % 12.93 %
equity ratio^2
Common stock:
Book value per $ 43.62 $ 42.35 $ 41.61 $ 40.36 $ 40.18
share
Market value
per share:
High $ 59.47 $ 58.12 $ 59.02 $ 55.90 $ 55.81
Low $ 55.63 $ 53.34 $ 52.56 $ 45.68 $ 44.00
Cash dividends $ 25,912 $ 25,904 $ 22,571 $ 22,451 $ 18,836
paid
Dividend payout 29.65 % 26.53 % 26.99 % 33.51 % 22.13 %
ratio
Shares
outstanding, 68,215,354 68,144,159 68,116,893 68,153,044 68,006,390
net
Stock buy-back
program:
Shares — 39,496 345,300 69,581 492,444
repurchased
Amount $ — $ 2,125 $ 18,432 $ 3,579 $ 22,866
Average price $ — $ 53.81 $ 53.38 $ 51.44 $ 46.43
per share
Performance ratios (quarter annualized):
Return on 1.31 % 1.54 % 1.32 % 1.04 % 1.37 %
average assets
Return on 11.80 % 13.69 % 11.86 % 9.59 % 12.33 %
average equity
Net interest 3.12 % 3.30 % 3.19 % 3.20 % 3.34 %
margin
Efficiency 61.12 % 62.45 % 59.77 % 69.73 % 60.13 %
ratio
Reconciliation of non-GAAP measures:
^1 Tangible
common equity
ratio:
Total
shareholders' $ 2,975,657 $ 2,885,934 $ 2,834,419 $ 2,750,468 $ 2,732,592
equity
Less: Goodwill
and intangible (392,158 ) (344,699 ) (345,246 ) (345,820 ) (346,716 )
assets, net
Tangible common $ 2,583,499 $ 2,541,235 $ 2,489,173 $ 2,404,648 $ 2,385,876
equity
Total assets $ 27,117,641 $ 25,576,046 $ 25,884,173 $ 25,493,946 $ 25,066,265
Less: Goodwill
and intangible (392,158 ) (344,699 ) (345,246 ) (345,820 ) (346,716 )
assets, net
Tangible assets $ 26,725,483 $ 25,231,347 $ 25,538,927 $ 25,148,126 $ 24,719,549
Tangible common 9.67 % 10.07 % 9.75 % 9.56 % 9.65 %
equity ratio
^2 Tier 1
common equity
ratio:
Tier 1 capital $ 2,436,791 $ 2,418,985 $ 2,344,779 $ 2,295,061 $ 2,247,576
Less:
Non-controlling (36,818 ) (36,787 ) (35,982 ) (36,184 ) (34,958 )
interest
Tier 1 common $ 2,399,973 $ 2,382,198 $ 2,308,797 $ 2,258,877 $ 2,212,618
equity
Risk weighted $ 18,448,854 $ 17,758,118 $ 17,993,379 $ 17,291,105 $ 17,106,533
assets
Tier 1 common 13.01 % 13.41 % 12.83 % 13.06 % 12.93 %
equity ratio
FINANCIAL HIGHLIGHTS -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands, except ratio and share data)
Three Months Ended
September 30, June 30, March 31, December 31, September 30,
2012 2012 2012 2011 2011
Other
data:
Trust $ 37,721,780 $ 35,748,719 $ 35,650,798 $ 34,398,796 $ 31,750,636
assets
Mortgage
servicing $ 11,756,350 $ 11,564,643 $ 11,378,806 $ 11,300,986 $ 11,249,503
portfolio
Mortgage
loans $ 1,046,608 $ 841,959 $ 746,241 $ 753,215 $ 637,127
funded for
sale
Mortgage
loan
refinances 61 % 51 % 67 % 66 % 54 %
to total
fundings
Tax
equivalent $ 2,509 $ 2,252 $ 2,094 $ 2,274 $ 2,233
adjustment
Net
unrealized
gain on $ 281,455 $ 242,253 $ 201,340 $ 222,160 $ 278,616
available
for sale
securities
Gain (loss) on mortgage servicing rights, net of economic hedge:
Gain
(loss) on
mortgage $ 645 $ 2,623 $ (2,445 ) $ 121 $ 4,048
hedge
derivative
contracts
Gain
(loss) on
mortgage 5,455 6,908 (2,393 ) 222 17,788
trading
securities
Gain
(loss) on
economic
hedge of 6,100 9,531 (4,838 ) 343 21,836
mortgage
servicing
rights
Gain
(loss) on
changes in
fair value (9,576 ) (11,450 ) 7,127 (5,261 ) (24,822 )
of
mortgage
servicing
rights
Gain
(loss) on
changes in
fair value
of
mortgage $ (3,476 ) $ (1,919 ) $ 2,289 $ (4,918 ) $ (2,986 )
servicing
rights,
net of
economic
hedges
Net
interest
revenue on $ 1,750 $ 2,148 $ 3,165 $ 4,436 $ 5,036
mortgage
trading
securities
QUARTERLY EARNINGS TREND -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands, except ratio and per share data)
Three Months Ended
September June 30, March 31, December 31, September
30, 2012 2012 2011 30,
2012 2011
Interest revenue $ 196,071 $ 203,055 $ 198,208 $ 198,040 $ 205,749
Interest expense 20,044 21,694 24,639 26,570 30,365
Net interest revenue 176,027 181,361 173,569 171,470 175,384
Provision for credit — (8,000 ) — (15,000 ) —
losses
Net interest revenue
after provision for 176,027 189,361 173,569 186,470 175,384
credit losses
Other operating
revenue:
Brokerage and 31,261 32,600 31,111 25,629 29,451
trading revenue
Transaction card 27,788 26,758 25,430 25,960 31,328
revenue
Trust fees and 19,654 19,931 18,438 17,865 17,853
commissions
Deposit service 25,148 25,216 24,379 24,921 24,614
charges and fees
Mortgage banking 50,266 39,548 33,078 25,438 29,493
revenue
Bank-owned life 2,707 2,838 2,871 2,784 2,761
insurance
Other revenue 9,476 7,559 9,027 9,189 10,535
Total fees and 166,300 154,450 144,334 131,786 146,035
commissions
Gain (loss) on other 125 2,990 (3,456 ) 1,682 351
assets, net
Gain (loss) on 464 2,345 (2,473 ) (174 ) 4,048
derivatives, net
Gain (loss) on fair
value option 6,192 6,852 (1,733 ) 222 17,788
securities, net
Gain on available
for sale securities, 7,967 20,481 4,331 7,080 16,694
net
Total
other-than-temporary — (135 ) (505 ) (1,037 ) (9,467 )
impairment losses
Portion of loss
recognized in
(reclassified from) (1,104 ) (723 ) (3,217 ) (1,747 ) (1,833 )
other comprehensive
income
Net impairment
losses recognized in (1,104 ) (858 ) (3,722 ) (2,784 ) (11,300 )
earnings
Total other 179,944 186,260 137,281 137,812 173,616
operating revenue
Other operating
expense:
Personnel 122,775 122,297 114,769 121,129 103,260
Business promotion 6,054 6,746 4,388 5,868 5,280
Contribution to BOKF
Charitable — — — — 4,000
Foundation
Professional fees 7,991 8,343 7,599 7,664 7,418
and services
Net occupancy and 16,914 16,906 16,023 16,826 16,627
equipment
Insurance 3,690 4,011 3,866 3,636 2,206
Data processing and 26,486 25,264 22,144 26,599 24,446
communications
Printing, postage 3,611 3,903 3,311 3,637 3,780
and supplies
Net losses and
operating expenses 5,706 5,912 2,245 6,180 5,939
of repossessed
assets
Amortization of 742 545 575 895 896
intangible assets
Mortgage banking 11,566 11,173 7,573 10,154 9,349
costs
Change in fair value
of mortgage 9,576 11,450 (7,127 ) 5,261 24,822
servicing rights
Other expense 7,229 6,461 6,770 11,133 12,512
Total other 222,340 223,011 182,136 218,982 220,535
operating expense
Net income before 133,631 152,610 128,714 105,300 128,465
taxes
Federal and state 45,778 53,149 45,520 37,396 43,006
income taxes
Net income 87,853 99,461 83,194 67,904 85,459
Net income (loss)
attributable to 471 1,833 (422 ) 911 358
non-controlling
interest
Net income
attributable to BOK
Financial $ 87,382 $ 97,628 $ 83,616 $ 66,993 $ 85,101
Corporation
shareholders
Average shares
outstanding:
Basic 67,966,700 67,472,665 67,665,300 67,526,009 67,827,591
Diluted 68,334,989 67,744,828 67,941,895 67,774,721 68,037,419
Net income per
share:
Basic $ 1.28 $ 1.43 $ 1.22 $ 0.98 $ 1.24
Diluted $ 1.27 $ 1.43 $ 1.22 $ 0.98 $ 1.24
LOANS BY PRINCIPAL MARKET AREA -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands)
Three Months Ended
September 30, June 30, March 31, December 31, September
2012 2012 2012 2011 30,
2011
Bank of
Oklahoma:
Commercial $ 3,141,217 $ 3,098,651 $ 3,107,726 $ 2,826,649 $ 2,865,740
Commercial 639,156 644,761 631,891 607,030 615,848
real estate
Residential 1,477,583 1,460,173 1,426,827 1,411,560 1,378,519
mortgage
Consumer 200,217 205,436 215,693 235,909 250,048
Total Bank 5,458,173 5,409,021 5,382,137 5,081,148 5,110,155
of Oklahoma
Bank of
Texas:
Commercial 2,529,473 2,414,824 2,354,593 2,249,888 2,116,377
Commercial 712,895 678,745 802,979 830,642 759,574
real estate
Residential 266,791 268,639 262,556 268,053 276,721
mortgage
Consumer 108,854 115,602 124,692 126,570 133,454
Total Bank 3,618,013 3,477,810 3,544,820 3,475,153 3,286,126
of Texas
Bank of
Albuquerque:
Commercial 267,469 262,144 273,284 258,668 279,319
Commercial 294,731 285,871 282,834 303,500 302,980
real estate
Residential 117,783 113,987 106,754 104,695 99,191
mortgage
Consumer 15,883 15,828 18,378 19,369 19,393
Total Bank
of 695,866 677,830 681,250 686,232 700,883
Albuquerque
Bank of
Arkansas:
Commercial 48,097 49,305 64,595 76,199 80,304
Commercial 119,305 119,895 139,670 136,170 134,028
real estate
Residential 12,408 12,513 14,557 15,772 15,793
mortgage
Consumer 19,720 24,270 28,783 35,911 44,445
Total Bank 199,530 205,983 247,605 264,052 274,570
of Arkansas
Colorado
State Bank &
Trust:
Commercial 616,321 610,384 541,280 544,020 495,429
Commercial 145,077 149,541 144,757 156,013 189,948
real estate
Residential 57,637 60,893 61,329 64,627 66,491
mortgage
Consumer 19,028 20,612 19,790 21,598 22,183
Total
Colorado 838,063 841,430 767,156 786,258 774,051
State Bank &
Trust
Bank of
Arizona:
Commercial 300,557 278,119 269,099 271,914 269,381
Commercial 186,553 181,513 180,830 198,160 227,085
real estate
Residential 65,234 67,822 76,699 89,315 92,293
mortgage
Consumer 6,150 6,227 5,381 5,633 6,670
Total Bank 558,494 533,681 532,009 565,022 595,429
of Arizona
Bank of
Kansas City:
Commercial 370,083 339,117 348,515 327,732 315,052
Commercial 67,809 65,888 50,722 59,788 43,370
real estate
Residential 21,544 21,070 19,650 20,505 20,893
mortgage
Consumer 4,792 4,601 3,580 3,853 4,040
Total Bank
of Kansas 464,228 430,676 422,467 411,878 383,355
City
TOTAL BOK $ 11,832,367 $ 11,576,431 $ 11,577,444 $ 11,269,743 $ 11,124,569
FINANCIAL
Loans attributed to a geographical region may not always represent the location of the borrower or the
collateral. The previous periods have been reclassified to conform to the current period loan
classification and market attribution.
DEPOSITS BY PRINCIPAL MARKET AREA -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands) Three Months Ended
September 30, June 30, March 31, December 31, September
2012 2012 2012 2011 30,
2011
Bank of Oklahoma:
Demand $ 3,734,900 $ 3,499,834 $ 3,445,424 $ 3,223,201 $ 2,953,410
Interest-bearing:
Transaction 5,496,724 5,412,002 5,889,625 6,050,986 6,038,770
Savings 155,277 150,353 148,556 126,763 122,829
Time 1,274,336 1,354,148 1,370,868 1,450,571 1,489,486
Total 6,926,337 6,916,503 7,409,049 7,628,320 7,651,085
interest-bearing
Total Bank of 10,661,237 10,416,337 10,854,473 10,851,521 10,604,495
Oklahoma
Bank of Texas:
Demand 1,983,678 1,966,465 1,876,133 1,808,491 1,710,315
Interest-bearing:
Transaction 1,782,296 1,813,209 1,734,655 1,940,819 1,820,116
Savings 52,561 51,114 50,331 45,872 42,272
Time 789,725 772,809 789,860 867,664 938,200
Total 2,624,582 2,637,132 2,574,846 2,854,355 2,800,588
interest-bearing
Total Bank of 4,608,260 4,603,597 4,450,979 4,662,846 4,510,903
Texas
Bank of
Albuquerque:
Demand 416,796 357,367 333,707 319,269 325,612
Interest-bearing:
Transaction 526,029 506,165 503,015 491,068 480,816
Savings 31,940 31,215 32,688 27,487 26,127
Time 375,611 383,350 392,234 410,722 431,436
Total 933,580 920,730 927,937 929,277 938,379
interest-bearing
Total Bank of 1,350,376 1,278,097 1,261,644 1,248,546 1,263,991
Albuquerque
Bank of Arkansas:
Demand 29,254 16,921 22,843 18,513 21,809
Interest-bearing:
Transaction 168,827 172,829 151,708 131,181 181,486
Savings 2,246 2,220 2,358 1,727 1,735
Time 45,719 48,517 54,157 61,329 74,163
Total 216,792 223,566 208,223 194,237 257,384
interest-bearing
Total Bank of 246,046 240,487 231,066 212,750 279,193
Arkansas
Colorado State
Bank & Trust:
Demand 330,641 301,646 311,057 272,565 217,394
Interest-bearing:
Transaction 627,015 465,276 476,718 511,993 520,743
Savings 24,689 24,202 23,409 22,771 22,599
Time 476,564 491,280 498,124 523,969 547,481
Total 1,128,268 980,758 998,251 1,058,733 1,090,823
interest-bearing
Total Colorado
State Bank & 1,458,909 1,282,404 1,309,308 1,331,298 1,308,217
Trust
Bank of Arizona:
Demand 151,738 137,313 131,539 106,741 138,971
Interest-bearing:
Transaction 298,048 113,310 95,010 104,961 101,933
Savings 2,201 2,313 1,772 1,192 1,366
Time 33,169 31,539 34,199 37,641 40,007
Total 333,418 147,162 130,981 143,794 143,306
interest-bearing
Total Bank of 485,156 284,475 262,520 250,535 282,277
Arizona
Bank of Kansas
City:
Demand 201,393 160,829 68,469 51,004 46,773
Interest-bearing:
Transaction 103,628 69,083 57,666 123,449 108,973
Savings 660 581 505 545 503
Time 27,202 26,307 26,657 30,086 33,697
Total 131,490 95,971 84,828 154,080 143,173
interest-bearing
Total Bank of 332,883 256,800 153,297 205,084 189,946
Kansas City
TOTAL BOK $ 19,142,867 $ 18,362,197 $ 18,523,287 $ 18,762,580 $ 18,439,022
FINANCIAL
NET INTEREST MARGIN TREND -- UNAUDITED
BOK FINANCIAL CORPORATION
Three Months Ended
September June March December September
30, 30, 31, 31, 30,
2012 2012 2012 2011 2011
TAX-EQUIVALENT
ASSETS YIELDS
Funds sold and 0.07 % 0.08 % 0.07 % 0.10 % 0.16 %
resell agreements
Trading securities 2.12 % 1.53 % 1.88 % 2.79 % 2.85 %
Investment
securities:
Taxable^1 5.83 % 5.93 % 5.89 % 5.91 % 5.63 %
Tax-exempt^1 4.12 % 4.90 % 4.87 % 4.81 % 4.94 %
Total investment 5.33 % 5.63 % 5.59 % 5.59 % 5.35 %
securities^1
Available for sale
securities:
Taxable^1 2.36 % 2.52 % 2.48 % 2.36 % 2.82 %
Tax-exempt^1 4.70 % 4.69 % 5.17 % 5.14 % 4.92 %
Total available for 2.38 % 2.54 % 2.50 % 2.38 % 2.83 %
sale securities^1
Fair value option 2.27 % 2.62 % 2.79 % 2.98 % 3.66 %
securities
Residential
mortgage loans held 3.48 % 3.75 % 3.90 % 4.01 % 4.09 %
for sale
Loans 4.33 % 4.58 % 4.50 % 4.65 % 4.71 %
Less allowance for — % — % — % — % — %
loan losses
Loans, net of 4.42 % 4.68 % 4.61 % 4.76 % 4.84 %
allowance
Total
tax-equivalent 3.47 % 3.69 % 3.64 % 3.69 % 3.91 %
yield on earning
assets^1
COST OF
INTEREST-BEARING
LIABILITIES
Interest-bearing
deposits:
Interest-bearing 0.16 % 0.16 % 0.17 % 0.18 % 0.23 %
transaction
Savings 0.19 % 0.23 % 0.24 % 0.26 % 0.34 %
Time 1.61 % 1.63 % 1.68 % 1.70 % 1.84 %
Total
interest-bearing 0.53 % 0.54 % 0.55 % 0.59 % 0.68 %
deposits
Funds purchased 0.15 % 0.16 % 0.09 % 0.06 % 0.05 %
Repurchase 0.10 % 0.10 % 0.09 % 0.13 % 0.17 %
agreements
Other borrowings 3.03 % 3.96 % 5.58 % 4.75 % 5.26 %
Subordinated debt 2.79 % 3.95 % 5.62 % 5.61 % 5.60 %
Total cost of
interest-bearing 0.52 % 0.56 % 0.63 % 0.66 % 0.76 %
liabilities
Tax-equivalent net
interest revenue 2.95 % 3.13 % 3.01 % 3.03 % 3.15 %
spread
Effect of
noninterest-bearing 0.17 % 0.17 % 0.18 % 0.17 % 0.19 %
funding sources and
other
Tax-equivalent net 3.12 % 3.30 % 3.19 % 3.20 % 3.34 %
interest margin^1
1 Yield calculations exclude security trades that have been recorded on trade date
with no corresponding interest income.
*Story too large*
CREDIT QUALITY INDICATORS
BOK FINANCIAL CORPORATION
(in thousands, except ratios)
Quarter Ended
September June 30, March 31, December September
30, 2012 2012 31, 30,
2012 2011 2011
Nonperforming
assets:
Nonaccruing
loans:
Commercial $ 21,762 $ 34,529 $ 61,750 $ 68,811 $ 83,736
Commercial 75,761 80,214 86,475 99,193 110,048
real estate
[TRUNCATED]
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