-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, O6wg00VXM8+dRT/AhcQi2cv2xmikd1FEabFfUyO7OttrVuwSTMSl8lrMWPwbnuJF zwOrx+w8FYIMuJm9OOOybQ== 0000875357-06-000042.txt : 20061017 0000875357-06-000042.hdr.sgml : 20061017 20061017163259 ACCESSION NUMBER: 0000875357-06-000042 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20060930 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20061017 DATE AS OF CHANGE: 20061017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BOK FINANCIAL CORP ET AL CENTRAL INDEX KEY: 0000875357 STANDARD INDUSTRIAL CLASSIFICATION: NATIONAL COMMERCIAL BANKS [6021] IRS NUMBER: 731373454 STATE OF INCORPORATION: OK FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-19341 FILM NUMBER: 061148972 BUSINESS ADDRESS: STREET 1: BANK OF OKLAHOMA TOWER STREET 2: PO BOX 2300 CITY: TULSA STATE: OK ZIP: 74192 BUSINESS PHONE: 9185953025 MAIL ADDRESS: STREET 1: BANK OF OKLAHOMA TOWER STREET 2: P O BOX 2300 CITY: TULSA STATE: OK ZIP: 74192 8-K 1 form8k093006.txt FORM 8-K Q306 EARNINGS RELEASE UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): October 17, 2006 BOK FINANCIAL CORPORATION (Exact name of registrant as specified in its charter) Oklahoma 000-19341 73-1373454 -------- --------- ---------- (State or other jurisdiction (Commission (IRS Employer of incorporation) File Number) Identification No.) Bank of Oklahoma Tower, Boston Avenue at Second Street, Tulsa, Oklahoma 74172 (Address of principal executive offices) Registrant's telephone number, including area code: (918) 588-6000 _____________________N/A___________________________ (Former name or former address, if changes since last report) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: |_| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425). |_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12). |_| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)). |_| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)). INFORMATION TO BE INCLUDED IN THE REPORT ITEM 2.02. Results of Operations and Financial Condition. On October 17, 2006, BOK Financial Corporation ("BOK Financial") issued a press release announcing its financial results for the three and nine months ended September 30, 2006 ("Press Release"). The full text of the Press Release is attached as Exhibit 99(a) to this report and is incorporated herein by reference. On October 17, 2006, in connection with issuance of the Press Release, BOK Financial released financial information related to the three and nine months ended September 30, 2006 ("Financial Information"), which includes certain historical financial information relating to BOK Financial. The Financial Information is attached as Exhibit 99(b) to this report and is incorporated herein by reference. ITEM 9.01. Financial Statements and Exhibits. (c) Exhibits 99(a) Text of Press Release, dated October 17, 2006, titled "BOK Financial Reports Third Quarter Earnings - Strong Balance Sheet Growth and Stable Margin Continue" 99(b) Financial Information for the Three and Nine Months Ended September 30, 2006 Signature Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. BOK FINANCIAL CORPORATION By: /s/ Steven E. Nell -------------------------------- Steven E. Nell Executive Vice President Chief Financial Officer Date: October 17, 2006 EX-99 2 press093006.txt (A) TEXT OF PRESS RELEASE DATED 10/17/06 EXHIBIT 99 (a) NASD: BOKF For Further Information Contact: Steven Nell Chief Financial Officer (918) 588-6000 Kayte Spillman Assistant Vice President Corporate Communications Specialist BOK Financial Corp. (918) 588-6378 BOK FINANCIAL REPORTS THIRD QUARTER EARNINGS Strong Balance Sheet Growth and Stable Margin Continue TULSA, Okla. (Tuesday, October 17, 2006) - BOK Financial Corporation reported earnings of $52.7 million or $0.78 per diluted share for the third quarter of 2006, up 4% over the third quarter of 2005. Net income for the third quarter of 2005 totaled $50.8 million or $0.76 per diluted share. Highlights of the quarter included: o Average outstanding loans and average deposits increased 14% and 13%, respectively over the third quarter of 2005 o Net interest revenue grew $11.2 million or 10% over last year's third quarter, 9% annualized over the second quarter of 2006 o Net interest margin was 3.38%, up from 3.32% over the third quarter of last year and stable throughout 2006 o Fee income increased $2.7 million or 3% over the third quarter of 2005 o Fair value of mortgage servicing rights declined $4.2 million, net of hedging gains during the third quarter o Other operating expenses increased $9.2 million or 8%, including a $1.8 million non-cash charge related to taxes on a $202 million investment in bank-owned life insurance; personnel costs were up $8.1 million o Income tax expense was reduced $2.2 million for the resolution of uncertain tax issues o Non-performing loans, annualized net charge-offs continued to be near historic lows "We were pleased to see the continuation of double digit loan and deposit growth while maintaining a stable net interest margin in a very competitive environment," said President and CEO Stan Lybarger. "Our fee revenue business lines have long been a key strength of the Company, but we clearly experienced slower growth during the third quarter." Net Interest Revenue Net interest revenue totaled $124.0 million for the third quarter of 2006, up $11.2 million or 10% over the same period of 2005. Average earning assets grew $1.2 billion or 9%, due to a $1.2 billion increase in average outstanding loans. Average deposits increased $1.3 billion or 13% compared with the third quarter of 2005. Net interest revenue was also improved by a $226 million reduction in short-term borrowed funds, which generally have a higher interest cost. Net interest margin was 3.38% for the third quarter of 2006 compared with 3.32% for the third quarter of 2005 and 3.40% for the second quarter of 2006. Net interest margin has remained stable throughout the first nine months of 2006. While the spread between the yield on earning assets and the cost of interest bearing liabilities continued to narrow, the Company benefited from a strong capital position. Loans and Deposits Outstanding loans totaled $10.0 billion at September 30, 2006, up $211 million over previous quarter's end. Commercial loans totaled $5.7 billion at September 30, 2006, a $140 million increase. Commercial lFoans grew in all sectors of the portfolio. The outstanding balance of commercial real estate loans remained unchanged at $2.3 billion. Commercial real estate loan growth in the Arizona and Colorado markets was largely offset by reductions in Texas and New Mexico. Regional markets continue to increase in importance to the Company as we continue to add experienced bankers in each market. At September 30, 2006, $4.3 billion or 43% of outstanding loans were attributed to markets outside of Oklahoma. Texas remained the largest regional market with $2.5 billion of loans outstanding at the end of the third quarter. Pay downs of commercial real estate loans reduced outstanding loans in the Texas market at a 4% annualized rate. Outstanding loans in the New Mexico, Colorado and Arizona markets totaled $698 million, $574 million and $313 million, respectively. Annualized loan growth during the third quarter was 24% in New Mexico, 52% in Colorado and 86% in Arizona. Deposits increased $349 million during the third quarter to $11.7 billion at September 30, 2006. Interest-bearing transaction accounts grew $471 million, an annualized rate of 38%. Rising interest rates led to a shift to interest-bearing transaction accounts from demand deposits, which decreased $117 million. Total deposits increased $184 million or 12% annualized in the Oklahoma market and $104 million or 14% annualized in the Texas market. In addition, deposits in the Colorado market increased $65 million or 38% annualized during the third quarter. Fees and Commissions Revenue Fees and commissions revenue totaled $93.0 million for the third quarter of 2006, up 3% from the same period last year. Total fee revenue, which recently had been growing at a low double digit rate, slowed in most major categories of fees and commissions. Mortgage banking revenue decreased $2.6 million or 27% due largely to lower volumes. "Volatile mortgage interest rates over the past six months affected this quarter's performance," said Lybarger. "Rising rates in the second quarter reduced our loan production pipeline coming into this quarter and falling rates in the third quarter reduced the value of our servicing portfolio." Brokerage and trading revenue declined $408 thousand or 4% from last year. A flat yield curve reduced revenue from trading activities $1.3 million or 20%. Derivatives revenue, primarily from customer energy hedging, increased $513 thousand or 21% over last year. Transaction card revenue grew $1.4 million or 8% from both check card and ATM processing fees. The Company recently signed agreements to place ATMs with two large regional convenience store chains. Trust revenue and deposit services charges increased $725 thousand or 4% and $703 thousand or 3%, respectively. Overdraft fees, which provided much of the recent growth in deposit services charges, were up $915 thousand or 5%. Investment banking revenue, which is included in other revenue, increased $1.3 million. A newly-developed tax-exempt leasing unit provided much of this revenue growth. Mortgage Servicing Rights Depreciation in the fair value of mortgage servicing rights, net of recognized gains on economic hedges decreased pre-tax income by $4.2 million and net income $2.7 million or $0.04 per diluted share during the third quarter. At the end of the second quarter, a 50 basis point decrease in mortgage interest rates was expected to reduce the fair value of the Company's servicing rights, net of economic hedge gains, by $659 thousand. Although average mortgage interest rates fell 52 basis points, increased prepayment speeds and mortgage rate volatility caused the third quarter's results to differ from expectations. Loans serviced by BOK Financial historically have prepaid at rates well-below national trends. Although still below national trends, actual prepayments in our servicing portfolio migrated upward during the third quarter. In addition, mortgage interest rate volatility over the past two quarters increased the risk-premium required by investors further lowering the fair value of the servicing rights. Year-to-date, the fair value of mortgage servicing rights, net of recognized losses on economic hedges, increased pre-tax income by $2.1 million. Operating Expenses and Taxes Operating expenses, excluding changes in the fair value of mortgage servicing rights, totaled $130.9 million, up $9.2 million over the third quarter of 2005. The third quarter of 2006 included a $1.8 million non-cash charge related to taxes on bank-owned life insurance. Personnel expense totaled $74.6 million for the third quarter of 2006, up $8.1 million over the third quarter of 2005. Salaries and wages increased $5.0 million or 12%. Average compensation per employee increased 8% and the average number of employees increased 4%. "We continued adding experienced bankers in the regional markets and in Kansas City where we expect to open a bank in the fourth quarter," Lybarger said. "We also increased expenditures related to product development, technology and support services. These investments are expected to provide long-term benefits to the Company." The Company reduced its provision for income taxes by $2.2 million which contributed $0.03 to diluted earnings per share. The statute of limitations on an uncertain income tax position expired during the third quarter of 2006. Credit Quality Net loans charged-off during the third quarter of 2006 totaled $4.3 million, compared with $3.8 million in the previous quarter and $3.3 million in the third quarter of 2005. Non-performing loans totaled $41 million at September 30, 2006 and continue to be at near-historic lows. The combined allowance for loan losses and reserve for off-balance sheet credit losses totaled $127 million or 1.28% of outstanding loans and 417% of non-accruing loans at September 30, 2006. The allowance for loan losses was $105 million and the reserve for off-balance sheet credit losses was $22 million. At June 30, 2006, the combined allowance for loan losses and reserve for off-balance sheet credit losses totaled $126 million or 1.30% of outstanding loans and 408% of non-accruing loans. The allowance for loan losses was $105 million and the reserve for off-balance sheet credit losses was $21 million. The provision for credit losses for the third quarter of 2006 was $5.3 million, compared with $4.0 million for the third quarter of 2005 and $3.8 million for the second quarter of 2006. About BOK Financial Corporation BOK Financial is a regional financial services company that provides commercial and consumer banking, investment and trust services, mortgage origination and servicing, and an electronic funds transfer network. Holdings include Bank of Albuquerque, N.A., Bank of Arizona, N.A., Bank of Arkansas, N.A., Bank of Oklahoma, N.A., Bank of Texas, N.A., Colorado State Bank & Trust, N.A., BOSC,Inc., the TransFund electronic funds network, Southwest Trust Company, N.A. and AXIA Investment Management, Inc. Shares of BOK Financial are traded on the NASDAQ under the symbol BOKF. For more information, visit www.bokf.com. Forward-looking Information 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. EX-99 3 fs093006.txt (B) FINANCIAL INFORMATION FOR Q306 EXHIBIT 99 (b) BALANCE SHEETS BOK FINANCIAL CORPORATION (In thousands) Period Ended --------------------------------------------------- September 30, December 31, September 30, 2006 2005 2005 -------------- --------------- ------------- (Unaudited) (Unaudited) ASSETS Cash and due from banks $ 595,566 $ 684,857 $ 564,987 Trading securities 21,437 18,633 38,032 Funds sold and resell agreements 31,765 14,465 49,475 Securities: Available for sale 4,653,469 4,821,575 4,824,098 Investment 247,510 245,125 243,161 Mortgage trading securities 111,753 - - -------------- --------------- ------------- Total securities 5,012,732 5,066,700 5,067,259 Loans: Commercial 5,677,576 5,299,935 5,067,690 Commercial real estate 2,325,159 1,989,902 1,972,624 Residential mortgage 1,250,955 1,169,331 1,166,559 Residential mortgage held for sale 49,269 51,666 46,306 Consumer 702,947 629,144 630,389 -------------- --------------- ------------- Total loans 10,005,906 9,139,978 8,883,568 Less reserve for loan losses (105,465) (103,876) (109,622) -------------- --------------- ------------- Loans, net of reserve 9,900,441 9,036,102 8,773,946 Premises and equipment, net 178,940 179,627 177,084 Accrued revenue receivable 108,685 99,874 88,721 Intangible assets, net 258,994 263,022 258,478 Mortgage servicing rights, net 65,788 54,097 52,872 Real estate and other repossessed assets 9,322 8,476 5,069 Bankers' acceptances 8,081 33,001 40,170 Derivative contracts 322,424 452,878 643,703 Cash surrender value of bank-owned life insurance 209,766 9,279 9,221 Receivable on unsettled securities trades 868 - - Other assets 391,102 406,058 570,584 -------------- --------------- ------------- TOTAL ASSETS $ 17,115,911 $ 16,327,069 $ 16,339,602 ============== =============== ============= LIABILITIES AND SHAREHOLDERS' EQUITY Deposits: Demand $ 1,707,066 $ 1,865,948 $ 1,756,695 Interest-bearing transaction 5,478,292 5,257,295 4,360,723 Savings 142,637 154,015 155,152 Time 4,328,187 4,098,060 4,126,635 -------------- --------------- ------------- Total deposits 11,656,182 11,375,318 10,399,205 Funds purchased and repurchase agreements 2,339,585 1,337,911 2,173,791 Other borrowings 595,506 1,054,298 1,051,228 Subordinated debentures 297,370 295,964 296,401 Accrued interest, taxes, and expense 83,411 92,219 70,667 Bankers' acceptances 8,081 33,001 40,170 Due on unsettled securities trades - 8,429 11,198 Derivative contracts 339,284 466,669 661,253 Other liabilities 126,574 124,106 122,147 -------------- --------------- ------------- TOTAL LIABILITIES 15,445,993 14,787,915 14,826,060 Shareholders' equity: Capital, surplus and retained earnings 1,745,401 1,606,965 1,559,108 Accumulated other comprehensive income (loss) (75,483) (67,811) (45,566) -------------- --------------- ------------- TOTAL SHAREHOLDERS' EQUITY 1,669,918 1,539,154 1,513,542 -------------- --------------- ------------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 17,115,911 $ 16,327,069 $ 16,339,602 ============== =============== =============
AVERAGE BALANCE SHEETS - UNAUDITED BOK FINANCIAL CORPORATION (In thousands) Quarter Ended --------------------------------------------------------------------------------------- September 30, June 30, March 31, December 31, September 30, 2006 2006 2006 2005 2005 -------------- --------------- ------------- --------------- -------------- ASSETS Trading securities $ 21,721 $ 23,672 $ 16,722 $ 20,595 $ 14,560 Funds sold and resell agreements 51,518 32,048 21,181 57,656 44,882 Securities: Available for sale 4,681,094 4,760,257 4,828,324 4,815,296 4,794,958 Investment 238,908 227,810 236,953 244,488 236,837 Mortgage trading securities 80,756 68,518 59,160 - - -------------- --------------- ------------- --------------- -------------- Total securities 5,000,758 5,056,585 5,124,437 5,059,784 5,031,795 Loans: Commercial 5,568,238 5,355,644 5,217,467 5,222,316 4,926,685 Commercial real estate 2,280,681 2,247,779 2,096,885 1,960,507 1,917,996 Residential mortgage 1,223,140 1,176,660 1,166,509 1,160,385 1,119,512 Residential mortgage held for sale 51,647 47,163 45,983 42,756 59,265 Consumer 689,896 645,064 637,863 619,582 612,274 -------------- --------------- ------------- --------------- -------------- Total loans 9,813,602 9,472,309 9,164,706 9,005,546 8,635,732 Less allowance for loan losses (106,474) (106,048) (105,135) (108,998) (109,840) -------------- --------------- ------------- --------------- -------------- Total loans, net 9,707,128 9,366,261 9,059,571 8,896,548 8,525,892 -------------- --------------- ------------- --------------- -------------- Total earning assets 14,781,125 14,478,566 14,221,911 14,034,583 13,617,129 Cash and due from banks 562,802 554,412 584,508 540,776 542,841 Other assets 1,487,196 1,531,312 1,463,820 1,627,352 1,427,905 -------------- --------------- ------------- --------------- -------------- TOTAL ASSETS $ 16,831,123 $ 16,564,290 $ 16,270,239 $ 16,202,711 $ 15,587,875 ============== =============== ============= =============== ============== LIABILITIES AND SHAREHOLDERS' EQUITY Deposits: Demand $ 1,453,163 $ 1,474,835 $ 1,485,398 $ 1,530,504 $ 1,424,102 Interest-bearing transaction 5,458,280 5,353,413 5,327,004 4,821,627 4,533,912 Savings 146,276 153,200 155,554 154,316 157,772 Time 4,314,672 4,220,204 4,162,952 4,216,625 3,958,948 -------------- --------------- ------------- --------------- -------------- Total deposits 11,372,391 11,201,652 11,130,908 10,723,072 10,074,734 Funds purchased and repurchase agreements 2,138,749 2,118,211 1,731,983 1,812,752 2,067,432 Other borrowings 750,247 684,431 882,878 1,049,635 1,047,423 Subordinated debentures 293,146 292,474 295,792 296,021 297,284 Other liabilities 657,269 695,418 680,897 814,192 613,667 -------------- --------------- ------------- --------------- -------------- TOTAL LIABILITIES 15,211,802 14,992,186 14,722,458 14,695,672 14,100,540 Shareholders' equity 1,619,321 1,572,104 1,547,781 1,507,039 1,487,335 -------------- --------------- ------------- --------------- -------------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 16,831,123 $ 16,564,290 $ 16,270,239 $ 16,202,711 $ 15,587,875 ============== =============== ============= =============== ==============
STATEMENTS OF EARNINGS - UNAUDITED BOK FINANCIAL CORPORATION (In thousands, except per share data) Quarter Ended Nine Months Ended --------------------------------- ------------------------------- September 30, September 30, --------------------------------- ------------------------------- 2006 2005 2006 2005 -------------- --------------- ------------- --------------- Interest revenue $ 255,480 $ 199,056 $ 719,505 $ 555,694 Interest expense 131,502 86,228 357,095 222,739 -------------- --------------- ------------- --------------- Net interest revenue 123,978 112,828 362,410 332,955 Provision for credit losses 5,254 3,976 12,449 7,991 -------------- --------------- ------------- --------------- Net interest revenue after provision for credit losses 118,724 108,852 349,961 324,964 Other operating revenue Brokerage and trading revenue 10,958 11,366 34,395 33,106 Transaction card revenue 19,939 18,526 58,398 53,048 Trust fees and commissions 17,101 16,376 52,797 48,651 Deposit service charges and fees 26,322 25,619 76,649 73,139 Mortgage banking revenue 6,935 9,535 20,919 23,663 Other revenue 11,756 8,896 33,683 24,453 -------------- --------------- ------------- --------------- Total fees and commissions 93,011 90,318 276,841 256,060 Gain (loss) on asset sales 475 675 1,247 7,584 Gain (loss) on securities, net 3,718 (4,744) (86) (5,115) Gain (loss) on derivatives, net 379 606 (102) 1,073 -------------- --------------- ------------- --------------- Total other operating revenue 97,583 86,855 277,900 259,602 Other operating expense Personnel 74,605 66,533 218,206 190,305 Business promotion 4,401 4,494 14,006 12,794 Professional fees and services 4,734 3,951 13,010 12,062 Net occupancy and equipment 13,222 12,587 39,447 37,331 Data processing and communications 16,931 17,492 50,083 48,972 Printing, postage and supplies 4,182 3,846 12,088 11,090 Net (gains) losses and operating expenses of repossessed assets 34 (387) 307 237 Amortization of intangible assets 1,299 1,801 4,028 5,146 Mortgage banking costs 2,869 4,268 8,795 11,268 Change in fair value of mortgage servicing rights 7,921 - (2,773) - Recovery for impairment of mortgage servicing rights - (4,671) - (3,207) Other expense 8,612 7,120 21,119 19,205 -------------- --------------- ------------- --------------- Total other operating expense 138,810 117,034 378,316 345,203 Income before taxes 77,497 78,673 249,545 239,363 Federal and state income taxes 24,837 27,846 87,153 86,016 -------------- --------------- ------------- --------------- Net income $ 52,660 $ 50,827 $ 162,392 $ 153,347 ============== =============== ============= =============== Average shares outstanding: Basic 66,756,458 66,427,447 66,749,141 63,239,165 Diluted 67,325,428 67,105,539 67,301,406 67,013,525 Earnings per share: Basic $ 0.79 $ 0.77 $ 2.43 $ 2.42 ============== =============== ============= =============== Diluted $ 0.78 $ 0.76 $ 2.41 $ 2.29 ============== =============== ============= ===============
FINANCIAL HIGHLIGHTS - UNAUDITED BOK FINANCIAL CORPORATION (In thousands, except ratio and share data) Quarter Ended --------------------------------------------------------------------------------------- September 30, June 30, March 31, December 31, September 30, 2006 2006 2006 2005 2005 -------------- --------------- ------------- --------------- -------------- Capital: Period-end shareholders' equity $ 1,669,918 $ 1,583,010 $ 1,565,435 $ 1,539,154 $ 1,513,542 Risk-based capital ratios: Tier 1 9.99% 10.00% 10.16% 9.84% 9.71% Total capital 12.07% 12.14% 12.41% 12.10% 12.04% Leverage ratio 8.88% 8.74% 8.60% 8.30% 8.01% Common stock: Book value per share $ 24.98 $ 23.68 $ 23.41 $ 23.07 $ 22.75 Market value per share: High $ 53.30 $ 49.60 $ 47.65 $ 48.53 $ 49.30 Low $ 48.13 $ 46.85 $ 44.40 $ 43.54 $ 45.26 Cash dividends paid $ 10,034 $ 10,024 $ 6,694 $ 6,664 $ 6,656 Dividend payout ratio 19.05% 18.23% 12.23% 13.84% 13.10% Shares outstanding, net 66,859,272 66,840,241 66,883,037 66,702,408 66,520,927 Stock buy-back program: Shares repurchased 71,447 108,322 61,408 - - Amount $ 3,702,729 $ 5,259,931 $ 2,759,075 $ - $ - -------------- --------------- ------------- --------------- -------------- Average price per share $ 51.82 $ 48.56 $ 44.93 $ - $ - ============== =============== ============= =============== ============== Performance ratios: Return on average assets 1.24% 1.33% 1.36% 1.18% 1.29% Return on average equity 12.90% 14.03% 14.35% 12.68% 13.56% Net interest margin 3.38% 3.40% 3.39% 3.34% 3.32% Efficiency ratio 59.81% 58.04% 59.61% 60.32% 59.53% Other data: Trust assets $ 29,732,804 $ 28,746,686 $ 29,091,040 $ 28,464,745 $ 27,598,958 Mortgage servicing portfolio $ 4,524,071 $ 4,536,605 $ 4,520,976 $ 4,056,427 $ 4,053,885 Mortgage loan fundings during the quarter $ 204,264 $ 214,835 $ 168,220 $ 211,426 $ 247,045 Mortgage loan refinances to total fundings 23.89% 21.71% 27.59% 27.12% 27.19% Tax equivalent adjustment $ 1,836 $ 1,640 $ 1,522 $ 1,392 $ 1,289
QUARTERLY EARNINGS TRENDS - UNAUDITED BOK FINANCIAL CORPORATION (In thousands, except ratio and per share data) Quarter Ended ----------------------------------------------------------------------------------- September 30, June 30, March 31, December 31, September 30, 2006 2006 2006 2005 2005 -------------- --------------- ------------- --------------- -------------- Interest revenue $ 255,480 $ 240,440 $ 223,585 $ 214,240 $ 199,056 Interest expense 131,502 119,334 106,259 97,854 86,228 -------------- --------------- ------------- --------------- -------------- Net interest revenue 123,978 121,106 117,326 116,386 112,828 Provision for credit losses 5,254 3,795 3,400 4,450 3,976 -------------- --------------- ------------- --------------- -------------- Net interest revenue after provision for credit losses 118,724 117,311 113,926 111,936 108,852 Other operating revenue Brokerage and trading revenue 10,958 11,427 12,010 11,116 11,366 Transaction card revenue 19,939 19,951 18,508 18,988 18,526 Trust fees and commissions 17,101 17,751 17,945 16,536 16,376 Deposit service charges and fees 26,322 26,341 23,986 25,222 25,619 Mortgage banking revenue 6,935 7,195 6,789 7,018 9,535 Other revenue 11,756 11,239 10,688 9,924 8,896 -------------- --------------- ------------- --------------- -------------- Total fees and commissions 93,011 93,904 89,926 88,804 90,318 Gain (loss) on asset sales 475 (269) 1,041 214 675 Gain (loss) on securities, net 3,718 (2,583) (1,221) (1,780) (4,744) Gain (loss) on derivatives, net 379 (172) (309) 106 606 -------------- --------------- ------------- --------------- -------------- Total other operating revenue 97,583 90,880 89,437 87,344 86,855 Other operating expense Personnel 74,605 72,369 71,232 68,666 66,533 Business promotion 4,401 4,802 4,803 5,170 4,494 Professional fees and services 4,734 4,362 3,914 4,534 3,951 Net occupancy and equipment 13,222 13,199 13,026 12,864 12,587 Data processing and communications 16,931 16,157 16,995 18,054 17,492 Printing, postage and supplies 4,182 4,001 3,905 3,976 3,846 Net (gains) losses and operating expense of repossessed assets 34 54 219 335 (387) Amortization of intangible assets 1,299 1,359 1,370 1,797 1,801 Mortgage banking costs 2,869 2,839 3,087 3,294 4,268 Change in fair value of mortgage servicing rights 7,921 (3,613) (7,081) - - Recovery for impairment of mortgage servicing rights - - - (708) (4,671) Other expense 8,612 6,598 5,909 5,921 7,120 -------------- --------------- ------------- --------------- -------------- Total other operating expense 138,810 122,127 117,379 123,903 117,034 Income before taxes 77,497 86,064 85,984 75,377 78,673 Federal and state income taxes 24,837 31,080 31,236 27,219 27,846 -------------- --------------- ------------- --------------- -------------- Net income $ 52,660 $ 54,984 $ 54,748 $ 48,158 $ 50,827 ============== =============== ============= =============== ============== Average shares outstanding: Basic 66,756,458 66,775,117 66,715,396 66,527,093 66,427,447 Diluted 67,325,428 67,317,681 67,260,659 67,146,614 67,105,539 Earnings per share: Basic $ 0.79 $ 0.82 $ 0.82 $ 0.72 $ 0.77 Diluted $ 0.78 $ 0.82 $ 0.81 $ 0.72 $ 0.76
LOANS BY PRINCIPAL MARKET AREA - UNAUDITED BOK FINANCIAL CORPORATION (In thousands) Quarter Ended --------------------------------------------------------------------------------------- September 30, June 30, March 31, December 31, September 30, 2006 2006 2006 2005 2005 -------------- --------------- ------------- --------------- -------------- Oklahoma: Commercial $ 3,213,532 $ 3,212,851 $ 3,074,406 $ 3,159,683 $ 3,101,209 Commercial real estate 1,008,341 1,019,815 936,030 862,700 890,737 Residential mortgage 887,632 855,087 847,848 842,757 839,344 Residential mortgage held for sale 49,269 54,026 40,299 51,666 46,306 Consumer 502,622 479,508 468,920 466,180 472,899 -------------- --------------- ------------- --------------- -------------- Total Oklahoma 5,661,396 5,621,287 5,367,503 5,382,986 5,350,495 Texas: Commercial 1,557,361 1,547,274 1,420,860 1,356,611 1,294,606 Commercial real estate 639,327 670,969 604,413 569,921 537,576 Residential mortgage 212,114 212,987 200,957 199,726 196,593 Consumer 80,836 84,212 87,669 89,017 89,329 -------------- --------------- ------------- --------------- -------------- Total Texas 2,489,638 2,515,442 2,313,899 2,215,275 2,118,104 New Mexico: Commercial 387,164 334,984 348,930 383,325 354,087 Commercial real estate 219,966 237,020 228,955 232,564 223,236 Residential mortgage 76,858 73,281 68,810 65,784 65,203 Consumer 13,899 13,404 13,820 15,137 15,195 -------------- --------------- ------------- --------------- -------------- Total New Mexico 697,887 658,689 660,515 696,810 657,721 Arkansas: Commercial 89,849 80,539 74,423 79,719 54,703 Commercial real estate 91,158 87,080 80,529 75,483 85,600 Residential mortgage 21,923 15,067 13,069 13,044 12,097 Consumer 67,206 51,166 33,548 25,659 20,397 -------------- --------------- ------------- --------------- -------------- Total Arkansas 270,136 233,852 201,569 193,905 172,797 Colorado: Commercial 353,657 299,380 267,928 270,108 219,208 Commercial real estate 170,081 155,453 134,771 133,537 132,741 Residential mortgage 17,656 21,113 20,383 21,918 26,186 Consumer 32,647 31,939 31,487 27,871 26,126 -------------- --------------- ------------- --------------- -------------- Total Colorado 574,041 507,885 454,569 453,434 404,261 Arizona: Commercial 76,013 63,019 52,274 50,489 43,877 Commercial real estate 196,286 153,870 120,262 115,697 102,734 Residential mortgage 34,772 33,913 26,270 26,102 27,136 Consumer 5,737 6,511 5,098 5,280 6,443 -------------- --------------- ------------- --------------- -------------- Total Arizona 312,808 257,313 203,904 197,568 180,190 -------------- --------------- ------------- --------------- -------------- TOTAL BOK FINANCIAL $ 10,005,906 $ 9,794,468 $ 9,201,959 $ 9,139,978 $ 8,883,568 ============== =============== ============= =============== ==============
DEPOSITS BY PRINCIPAL MARKET AREA - UNAUDITED BOK FINANCIAL CORPORATION (In thousands) Quarter Ended --------------------------------------------------------------------------------------- September 30, June 30, March 31, December 31, September 30, 2006 2006 2006 2005 2005 -------------- --------------- ------------- --------------- -------------- Oklahoma: Demand $ 868,502 $ 908,034 $ 950,582 $ 1,003,284 $ 959,169 Interest-bearing: Transaction 3,001,774 2,732,312 2,937,228 3,002,610 2,411,175 Savings 83,442 88,218 93,093 85,837 86,220 Time 2,621,522 2,662,770 2,623,352 2,564,337 2,728,224 -------------- --------------- ------------- --------------- -------------- Total interest-bearing 5,706,738 5,483,300 5,653,673 5,652,784 5,225,619 -------------- --------------- ------------- --------------- -------------- Total Oklahoma 6,575,240 6,391,334 6,604,255 6,656,068 6,184,788 -------------- --------------- ------------- --------------- -------------- Texas: Demand 582,014 638,157 551,411 615,732 533,475 Interest-bearing: Transaction 1,671,993 1,530,491 1,455,856 1,535,570 1,299,279 Savings 25,888 26,370 27,827 27,398 29,620 Time 736,316 717,027 726,530 735,731 633,785 -------------- --------------- ------------- --------------- -------------- Total interest-bearing 2,434,197 2,273,888 2,210,213 2,298,699 1,962,684 -------------- --------------- ------------- --------------- -------------- Total Texas 3,016,211 2,912,045 2,761,624 2,914,431 2,496,159 -------------- --------------- ------------- --------------- -------------- New Mexico: Demand 144,138 147,307 159,125 129,289 155,517 Interest-bearing: Transaction 434,521 410,166 408,160 381,099 338,706 Savings 16,804 16,860 17,805 17,839 17,614 Time 481,993 494,426 483,428 453,314 454,561 -------------- --------------- ------------- --------------- -------------- Total interest-bearing 933,318 921,452 909,393 852,252 810,881 -------------- --------------- ------------- --------------- -------------- Total New Mexico 1,077,456 1,068,759 1,068,518 981,541 966,398 -------------- --------------- ------------- --------------- -------------- Arkansas: Demand 11,914 11,521 11,629 10,429 13,772 Interest-bearing: Transaction 19,504 20,577 26,675 22,354 23,335 Savings 1,058 1,072 1,051 1,058 1,268 Time 61,966 69,418 73,082 75,034 81,510 -------------- --------------- ------------- --------------- -------------- Total interest-bearing 82,528 91,067 100,808 98,446 106,113 -------------- --------------- ------------- --------------- -------------- Total Arkansas 94,442 102,588 112,437 108,875 119,885 -------------- --------------- ------------- --------------- -------------- Colorado: Demand 38,264 45,214 56,419 61,647 51,978 Interest-bearing: Transaction 275,714 245,504 258,801 258,668 216,718 Savings 13,037 13,786 16,315 17,772 16,568 Time 421,841 379,239 309,068 264,020 221,753 -------------- --------------- ------------- --------------- -------------- Total interest-bearing 710,592 638,529 584,184 540,460 455,039 -------------- --------------- ------------- --------------- -------------- Total Colorado 748,856 683,743 640,603 602,107 507,017 -------------- --------------- ------------- --------------- -------------- Arizona: Demand 62,234 73,696 55,421 45,567 42,784 Interest-bearing: Transaction 74,786 67,841 57,400 56,994 71,510 Savings 2,408 2,702 3,380 4,111 3,862 Time 4,549 4,077 4,608 5,624 6,802 -------------- --------------- ------------- --------------- -------------- Total interest-bearing 81,743 74,620 65,388 66,729 82,174 -------------- --------------- ------------- --------------- -------------- Total Arizona 143,977 148,316 120,809 112,296 124,958 -------------- --------------- ------------- --------------- -------------- TOTAL BOK FINANCIAL $ 11,656,182 $ 11,306,785 $ 11,308,246 $ 11,375,318 $ 10,399,205 ============== =============== ============= =============== ==============
NET INTEREST MARGIN TREND - UNAUDITED BOK FINANCIAL CORPORATION Quarter Ended -------------------------------------------------------------------------------- September 30, June 30, March 31, December 31, September 30, 2006 2006 2006 2005 2005 -------------- --------------- ------------- --------------- -------------- TAX-EQUIVALENT ASSETS YIELDS Trading securities 4.13% 4.86% 5.07% 4.68% 4.66% Funds sold and resell agreements 5.00% 5.09% 4.58% 4.00% 3.41% Securities: Taxable 4.63% 4.75% 4.60% 4.44% 4.28% Tax-exempt 5.43% 5.12% 5.36% 5.05% 4.96% -------------- --------------- ------------- --------------- -------------- Total securities 4.68% 4.77% 4.64% 4.47% 4.31% Total loans 7.99% 7.68% 7.35% 6.98% 6.66% Less Allowance for loan losses - - - - - -------------- --------------- ------------- --------------- -------------- Total loans, net 8.08% 7.76% 7.44% 7.06% 6.75% -------------- --------------- ------------- --------------- -------------- Total tax-equivalent yield on earning assets 6.91% 6.71% 6.42% 6.12% 5.83% COST OF INTEREST-BEARING LIABILITIES Interest-bearing deposits: Interest-bearing transaction 2.88% 2.61% 2.37% 1.98% 1.66% Savings 0.98% 0.92% 0.86% 0.75% 0.70% Time 4.46% 4.26% 4.03% 3.77% 3.53% -------------- --------------- ------------- --------------- -------------- Total interest-bearing deposits 3.54% 3.30% 3.06% 2.78% 2.50% Funds purchased and repurchase agreements 5.11% 4.87% 4.33% 3.92% 3.40% Other borrowings 5.42% 5.09% 4.60% 4.08% 3.60% Subordinated debt 7.05% 6.76% 6.74% 6.28% 5.97% -------------- --------------- ------------- --------------- -------------- Total cost of interest-bearing liabilities 3.98% 3.73% 3.43% 3.14% 2.84% -------------- --------------- ------------- --------------- -------------- Tax-equivalent net interest revenue spread 2.93% 2.98% 2.99% 2.98% 2.99% Effect of noninterest-bearing funding sources and other 0.45% 0.42% 0.40% 0.36% 0.33% -------------- --------------- ------------- --------------- -------------- Tax-equivalent net interest margin 3.38% 3.40% 3.39% 3.34% 3.32% ============== =============== ============= =============== ==============
CREDIT QUALITY INDICATORS BOK FINANCIAL CORPORATION (In thousands, except ratios) Quarter Ended ------------------------------------------------------------------------------- September 30, June 30, March 31, December 31, September 30, 2006 2006 2006 2005 2005 -------------- --------------- ------------- --------------- -------------- Nonperforming assets: Nonaccruing loans $ 30,476 $ 30,976 $ 32,229 $ 25,162 $ 37,353 Renegotiated loans 1,064 - - - - Real estate and other repossessed assets 9,322 8,257 8,196 8,476 5,069 -------------- --------------- ------------- --------------- -------------- Total nonperforming assets $ 40,862 $ 39,233 $ 40,425 $ 33,638 $ 42,422 ============== =============== ============= =============== ============== Performing loans 90 days past due $ 5,076 $ 9,630 $ 3,919 $ 8,708 $ 10,027 Gross charge-offs $ 8,099 $ 5,881 $ 4,149 $ 9,579 $ 5,311 Recoveries 3,803 2,085 2,564 2,164 1,977 -------------- --------------- ------------- --------------- -------------- Net charge-offs $ 4,296 $ 3,796 $ 1,585 $ 7,415 $ 3,334 ============== =============== ============= =============== ============== Provision for credit losses $ 5,254 $ 3,795 $ 3,400 $ 4,450 $ 3,976 Reserve for loan losses to period end loans (A) 1.06% 1.07% 1.14% 1.14% 1.24% Combined reserves for credit losses to period end loans 1.28% 1.30% 1.38% 1.37% 1.44% Nonperforming assets to period end loans (A) and repossessed assets 0.41% 0.40% 0.44% 0.37% 0.48% Net charge-offs (annualized) to average loans (A) 0.18% 0.16% 0.07% 0.33% 0.16% Reserve for loan losses to nonaccruing loans 346.06% 337.44% 323.13% 412.83% 293.48% Combined reserves for credit losses to nonaccruing loans 417.45% 407.62% 391.77% 494.60% 341.11%
(A) excluding residential mortgage loans held for sale -----END PRIVACY-ENHANCED MESSAGE-----