0000875357-17-000047.txt : 20171025 0000875357-17-000047.hdr.sgml : 20171025 20171025080133 ACCESSION NUMBER: 0000875357-17-000047 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20171025 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20171025 DATE AS OF CHANGE: 20171025 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: 001-37811 FILM NUMBER: 171152094 BUSINESS ADDRESS: STREET 1: BANK OF OKLAHOMA TOWER STREET 2: BOSTON AVENUE AT SECOND STREET CITY: TULSA STATE: OK ZIP: 74172 BUSINESS PHONE: 9185886000 MAIL ADDRESS: STREET 1: BANK OF OKLAHOMA TOWER STREET 2: P O BOX 2300 CITY: TULSA STATE: OK ZIP: 74192 8-K 1 a20170930bokfpressrelease8.htm 8-K Document


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 25, 2017

Commission File No. 0-19341

BOK FINANCIAL CORPORATION
(Exact name of registrant as specified in its charter)

Oklahoma
 
73-1373454
(State or other jurisdiction
of Incorporation or Organization)
 
(IRS Employer
Identification No.)
 
 
 
Bank of Oklahoma Tower
 
 
Boston Avenue at Second Street
 
 
Tulsa, Oklahoma
 
74192
(Address of Principal Executive Offices)
 
(Zip Code)
 
(918) 588-6000
(Registrant’s telephone number, including area code)

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)).

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
¨ Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨







INFORMATION TO BE INCLUDED IN THE REPORT

ITEM 2.02. Results of Operations and Financial Condition.

On October 25, 2017, BOK Financial Corporation (“BOK Financial”) issued a press release announcing its financial results for the three and nine months ended September 30, 2017 (“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 25, 2017, in connection with issuance of the Press Release, BOK Financial released financial information related to the three and nine months ended September 30, 2017 (“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.

(a)
Exhibits

99
  


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 25, 2017



EX-99 2 a20170930bokfex99.htm EXHIBIT 99 Exhibit


Exhibit 99 (a)
image0a01a01a01a08.jpg

NASD: BOKF


For Further Information Contact:
Joseph Crivelli             
Investor Relations             
(918) 595-3027             

BOK Financial Reports Quarterly Earnings of $86 Million

TULSA, Okla. (Wednesday, October 25, 2017) - BOK Financial Corporation reported net income of $85.6 million or $1.31 per diluted share for the third quarter of 2017. Net income was $88.1 million or $1.35 per diluted share for the second quarter of 2017 and $74.3 million or $1.13 per diluted share for the third quarter of 2016.

Steven G. Bradshaw, president and chief executive officer of BOK Financial, stated, “It was another very strong quarter for BOK Financial, and the earnings momentum we’ve demonstrated in 2017 continued through the third quarter. Net interest margin continued to expand as a result of the June 2017 Federal Reserve rate hike, combined with deposit pricing discipline across the banking industry. This, in turn, translated to record net interest income for the quarter. Our sound credit underwriting and discipline, combined with a benign credit environment, resulted in no loan loss provision for the fourth consecutive quarter. Looking forward to 2018, we see many of the trends we’ve experienced in 2017 continuing, including a favorable rate environment, strong organic revenue growth, and careful expense management to drive earnings leverage.”

Bradshaw continued, “During the third quarter, the company was impacted by two weather events: Hurricane Harvey in Houston, as well as a tornado, which struck one of our facilities in Tulsa. In both cases, employees rallied and worked around the clock to minimize the impact to customers. In addition, employees contributed almost $90,000 to an assistance fund to help their colleagues in Houston recover from the storm, and several employees reported that teammates arrived at their homes the weekend following to help remove debris, pull down damaged drywall, and lend a helping hand. I’m extremely proud of our employees for their heartfelt response and can-do attitude during these events. From a company standpoint, the storms negatively impacted earnings by $2.4 million this quarter.”

 Third Quarter 2017 Highlights
Net interest revenue totaled $218.5 million for the third quarter of 2017, up $13.2 million over the second quarter of 2017. Net interest margin increased to 3.01 percent for the third quarter of 2017 from 2.89 percent for the second quarter of 2017. Recoveries of foregone interest on non-accruing loans added 6 basis points to net interest margin in the third quarter of 2017. Average earning assets grew by $395 million.

1



Fees and commissions revenue totaled $173.5 million for the third quarter of 2017, compared to $177.5 million for the second quarter of 2017. Mortgage banking revenue decreased $5.4 million due to lower gain on sale margin and mortgage production volumes.
Operating expense was $265.9 million for the third quarter of 2017, an increase of $15.0 million over the prior quarter. Personnel expense was up $4.2 million, primarily due to increased incentive compensation expense. Non-personnel expense increased $10.9 million. Deposit insurance expense for the second quarter of 2017 included $5.1 million in credits related to the revision of certain inputs to the assessment calculation filed in previous periods. Net losses and operating expenses of repossessed assets increased $3.8 million primarily due to the write-down of one set of repossessed oil and gas properties.
No provision for credit losses was recorded in the third quarter of 2017 or the second quarter of 2017. The company had net charge-offs of $3.4 million in the third quarter of 2017, compared to net charge-offs of $1.7 million in the previous quarter.
The combined allowance for credit losses totaled $253 million or 1.47 percent of outstanding loans at September 30, 2017, compared to $256 million or 1.49 percent of outstanding loans at June 30, 2017.
Nonperforming assets that are not guaranteed by U.S. government agencies totaled $249 million or 1.46 percent of outstanding loans and repossessed assets at September 30, 2017 and $276 million or 1.62 percent of outstanding loans and repossessed assets at June 30, 2017. The decrease in nonperforming assets was primarily due to nonaccruing energy loans.
Average loans increased $127 million over the previous quarter. Period-end outstanding loan balances totaled $17.2 billion at September 30, 2017, a $23 million increase over June 30, 2017.
Average deposits were largely unchanged compared to the previous quarter. Average demand deposit balances grew by $51 million, partially offset by a $28 million decrease in time deposit balances. Period-end deposits were $21.8 billion at September 30, 2017, a $468 million decrease compared to June 30, 2017.
The common equity Tier 1 capital ratio at September 30, 2017 was 11.90 percent. Other regulatory capital ratios were Tier 1 capital ratio, 11.90 percent, total capital ratio, 13.47 percent and leverage ratio, 9.30 percent. At June 30, 2017, the common equity Tier 1 capital ratio was 11.76 percent, the Tier 1 capital ratio was 11.76 percent, total capital ratio was 13.36 percent, and leverage ratio was 9.27 percent.


2



Net Interest Revenue
Net interest revenue was $218.5 million for the third quarter of 2017, up $13.2 million over the second quarter of 2017.
Net interest margin was 3.01 percent for the third quarter of 2017, an increase of 12 basis points over the second quarter of 2017. Recoveries of foregone interest primarily related to nonaccruing energy loans added 6 basis points to the net interest margin for the third quarter. Net interest margin also increased due to a full quarter's impact on short-term market interest rates from the 25 basis point rate hike by the Federal Reserve in June. Yields on floating-rate earning assets improved, while deposit costs rose modestly. Excluding interest recoveries, the yield on average earning assets was 3.44 percent, an increase of 14 basis points and the loan portfolio yield was 4.20 percent, a 17 basis point increase. The yield on the available for sale securities portfolio increased 6 basis points to 2.17 percent. The yield on interest-bearing cash and cash equivalents increased 25 basis points. Funding costs were 0.75 percent, up 12 basis points. The cost of interest-bearing deposits increased 5 basis points to 0.45 percent as market pricing pressure remained relatively subdued. The cost of other borrowed funds was up 21 basis points to 1.23 percent. The benefit to net interest margin from assets funded by non-interest liabilities increased to 26 basis points from 22 basis points in the second quarter of 2017.
Average earning assets increased $395 million over the third quarter of 2017. Fair value option securities held as an economic hedge of our mortgage servicing rights increased $208 million. Average loan balances grew by $127 million. Available for sale securities increased $44 million, trading securities increased $36 million and restricted equity security balances were up $33 million over the prior quarter. These increases were partially offset by a $42 million decrease in average interest-bearing cash and cash equivalents balances.
Average interest-bearing deposit balances decreased $24 million compared to the second quarter of 2017. The average balance of borrowed funds increased $511 million.
Fees and Commissions Revenue
Fees and commissions revenue totaled $173.5 million for the third quarter of 2017, a decrease of $4.0 million compared to the second quarter of 2017.
Mortgage banking revenue totaled $24.9 million for the third quarter of 2017, a $5.4 million decrease compared to the second quarter of 2017. Revenue from mortgage loan production decreased $5.5 million due to a 54 basis point decrease in gain on sale margin and a $78 million decrease in mortgage loan production, due to market pricing pressure.
Increased transaction card revenue and brokerage and trading revenue was partially offset by lower fiduciary and asset management revenue.

3



Operating Expense
Total operating expense was $265.9 million for the third quarter of 2017, a $15.0 million increase over the second quarter of 2017, including $1.3 million of expense related to tornado damage sustained on our Tulsa operations center and the impact of the hurricane in the Houston market.
Personnel expense increased $4.2 million primarily due to a $4.7 million increase in incentive compensation expense. Equity compensation expense included charges of $4.0 million from changes in the probability that performance-based awards granted in 2015, 2016 and 2017 will vest and $1.9 million from a $4.93 per share increase in the fair value of BOKF stock. Cash-based incentive compensation expense increased $3.7 million due to continued improvement in performance metrics.
Non-personnel expense increased $10.9 million over the second quarter of 2017. Deposit insurance expense increased $5.3 million. The second quarter included $5.1 million of rebates for years 2013 through 2016. Net losses and operating expenses of repossessed assets increased $3.8 million, primarily due to a $4.7 million write-down of a set of repossessed oil and gas properties.
Loans, Deposits and Capital
Loans
Outstanding loans were $17.2 billion at September 30, 2017, an increase of $23 million over June 30, 2017. Growth in commercial loan balances was partially offset by a decrease in commercial real estate loan balances.
Outstanding commercial loan balances grew by $158 million. Wholesale/retail sector loan balances grew by $114 million. Other commercial and industrial loans increased by $23 million and energy loan balances were up $21 million. Unfunded energy loan commitments were largely unchanged at $2.7 billion. Healthcare sector loan balances increased $18 million. This growth was partially offset by a $27 million decrease in manufacturing service sector loan balances.
Commercial real estate loan balances decreased $170 million compared to June 30, 2017 as a higher than expected number of borrowers refinanced in the long-term permanent markets during the quarter. Loans secured by industrial properties decreased $103 million, primarily in the Texas market partially offset by growth in loans in the Oklahoma market. Loans secured by office buildings decreased $66 million, primarily in the Texas and Colorado markets. Residential land and construction loans decreased $29 million and other commercial real estate loans decreased $22 million. Multifamily residential loans increased $47 million. Growth in the Texas and Oklahoma markets was partially offset by a decrease in the Colorado market.
Deposits
Period-end deposits totaled $21.8 billion at September 30, 2017, a $468 million decrease compared to June 30, 2017. Demand deposit balances decreased $383 million. Wealth management demand deposit balances were elevated at June 30 in anticipation of upcoming debt service payments for corporate trust customers. Interest-bearing transaction account balances decreased $62 million and time deposits decreased $24 million. Wealth Management deposits decreased $363 million and Commercial Banking deposits decreased $218 million. Consumer Banking deposits were largely unchanged compared to the previous quarter.

4



Capital
The company's common equity Tier 1 capital ratio was 11.90 percent at September 30, 2017. In addition, the company's Tier 1 capital ratio was 11.90 percent, total capital ratio was 13.47 percent and leverage ratio was 9.30 percent at September 30, 2017. At June 30, 2017, the company's common equity Tier 1 capital ratio was 11.76 percent, Tier 1 capital ratio was 11.76 percent, total capital ratio was 13.36 percent, and leverage ratio was 9.27 percent.
The company's tangible common equity ratio, a non-GAAP measure, was 9.23 percent at September 30, 2017 and 9.24 percent at June 30, 2017. The tangible common equity ratio is primarily based on total shareholders' equity, which includes unrealized gains and losses on available for sale securities. The company has elected to exclude unrealized gains and losses from available for sale securities from its calculation of Tier 1 capital for regulatory capital purposes, consistent with the treatment under the previous capital rules.

5



Credit Quality
Nonperforming assets totaled $328 million or 1.90 percent of outstanding loans and repossessed assets at September 30, 2017, compared to $365 million or 2.12 percent at June 30, 2017. Nonperforming assets that are not guaranteed by U.S. government agencies totaled $249 million or 1.46 percent of outstanding loans and repossessed assets (excluding those guaranteed by U.S. government agencies) at September 30, 2017, compared to $276 million or 1.62 percent at June 30, 2017.
Nonaccruing loans totaled $226 million or 1.31 percent of outstanding loans at September 30, 2017, down from $245 million or 1.43 percent of outstanding loans at June 30, 2017. The decrease in nonaccruing loans was primarily due to a $13 million decrease in energy loans. Nonaccruing wholesale/retail sector loans decreased $8.7 million and nonaccruing service sector loans decreased $6.6 million, partially offset by a $9.0 million increase in nonaccruing other commercial and industrial loans. New nonaccruing loans identified in the third quarter totaled $24 million, offset by $35 million in payments received, $5.8 million in charge-offs and $3.8 million in foreclosures and repossessions. At September 30, 2017, nonaccruing commercial loans totaled $177 million or 1.64 percent of outstanding commercial loans, nonaccruing commercial real estate loans totaled $3.0 million or 0.08 percent of outstanding commercial real estate loans and nonaccruing residential mortgage loans totaled $46 million or 2.34 percent of outstanding residential mortgage loans.
Approximately $90 million of nonaccruing loans required a specific allowance of $13 million. No specific allowance was necessary for the remaining $136 million of nonaccruing loans based on estimated cash flows or collateral value. At June 30, 2017, $73 million of nonaccruing loans required specific allowances of $9.7 million. No specific allowance was necessary for the remaining $172 million of nonaccruing loans.
Potential problem loans, which are defined as performing loans that, based on known information, cause management concern as to the borrowers' ability to continue to perform, totaled $285 million at September 30 compared to $327 million at June 30. The decrease largely resulted from energy and service sector potential problem loans, partially offset by an increase in healthcare and other commercial and industrial potential problem loans.
The company had net charge-offs of $3.4 million for the third quarter of 2017, compared to net charge-offs of $1.7 million in the second quarter of 2017. Gross charge-offs totaled $5.8 million for the third quarter, compared to $2.9 million for the previous quarter. Recoveries totaled $2.4 million for the third quarter of 2017 and $1.2 million for the second quarter of 2017.
Based on an evaluation of all credit factors, including changes in nonaccruing and potential problem loans, overall loan portfolio growth and net charge-offs, the company determined that no provision for credit losses was necessary during the third quarter of 2017.
The combined allowance for credit losses totaled $253 million or 1.47 percent of outstanding loans and 117 percent of nonaccruing loans at September 30, 2017, excluding residential mortgage loans guaranteed by U.S. government agencies. The allowance for loan losses was $248 million and the accrual for off-balance sheet credit losses was $5.4 million. At June 30, 2017, the combined allowance for credit losses was $256 million or 1.49 percent of outstanding loans and 109 percent of nonaccruing loans, excluding loans guaranteed by U.S. government agencies. The allowance for loan losses was $250 million and the accrual for off-balance sheet credit losses was $6.4 million

6



Securities and Derivatives
The fair value of the available for sale securities portfolio totaled $8.4 billion at September 30, 2017, a $42 million increase compared to June 30, 2017. At September 30, 2017, the available for sale portfolio consisted primarily of $5.3 billion of residential mortgage-backed securities fully backed by U.S. government agencies and $2.9 billion of commercial mortgage-backed securities fully backed by U.S. government agencies. At September 30, 2017, the available for sale securities portfolio had a net unrealized gain of $14 million compared to a $16 million net unrealized gain at June 30, 2017.
The company also maintains a portfolio of financial instruments consisting primarily of residential mortgage-backed securities issued by U.S. government agencies and interest rate derivative contracts as an economic hedge of the changes in the fair value of our mortgage servicing rights.
The net economic benefit of the changes in fair value of mortgage servicing rights and related economic hedges was $3.6 million during the third quarter of 2017, including a $639 thousand decrease in the fair value of mortgage servicing rights, a $1.7 million increase in the fair value of securities and derivative contracts held as an economic hedge and $2.5 million of related net interest revenue.
The fair value of mortgage servicing rights decreased by $6.9 million during the second quarter of 2017. The fair value of securities and interest rate derivative contracts held as an economic hedge of mortgage servicing rights increased by $5.2 million. Related net interest revenue was $2.0 million during the second quarter of 2017.

7



Conference Call and Webcast

The company will hold a conference call at 9 a.m. Central time on Wednesday, October 25, 2017 to discuss the financial results with investors. The live audio webcast and presentation slides will be available on the company’s website at www.bokf.com. The conference call can also be accessed by dialing 1-201-689-8471. A conference call and webcast replay will also be available shortly after conclusion of the live call at www.bokf.com or by dialing 1-412-317-6671 and referencing conference ID # 13671914.

About BOK Financial Corporation
BOK Financial Corporation is a $33 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, BOK Financial Securities, Inc. and The Milestone Group, Inc. BOKF, NA operates TransFund, Cavanal Hill Investment Management, BOK Financial Asset Management, Inc. and seven banking divisions: Bank of Albuquerque, Bank of Arizona, Bank of Arkansas, Mobank, Bank of Oklahoma, Bank of Texas and Colorado State Bank and Trust. Through its subsidiaries, the company provides commercial and consumer banking, investment and trust services, mortgage origination and servicing, and an electronic funds transfer network. For more information, visit www.bokf.com.
The company will continue to evaluate critical assumptions and estimates, such as the appropriateness of the allowance for credit losses and asset impairment as of September 30, 2017 through the date its financial statements are filed with the Securities and Exchange Commission and will adjust amounts reported if necessary.
This news release contains forward-looking statements that are based on management's beliefs, assumptions, current expectations, estimates and projections about BOK Financial, the financial services industry and the economy generally. Words such as “anticipates,” “believes,” “estimates,” “expects,” “forecasts,” “plans,” “projects,” “will,” “intends,” variations of such words and similar expressions are intended to identify such forward-looking statements. Management judgments relating to and discussion of the provision and allowance for credit losses, allowance for uncertain tax positions, accruals for loss contingencies and valuation of mortgage servicing rights involve judgments as to expected events and are inherently forward-looking statements. Assessments that BOK Financial's acquisitions and other growth endeavors will be profitable are necessary statements of belief as to the outcome of future events based in part on information provided by others which BOK Financial has not independently verified. These statements are not guarantees of future performance and involve certain risks, uncertainties, and assumptions which are difficult to predict with regard to timing, extent, likelihood and degree of occurrence. Therefore, actual results and outcomes may materially differ from what is expected, implied or forecasted in such forward-looking statements. Internal and external factors that might cause such a difference include, but are not limited to changes in commodity prices, interest rates and interest rate relationships, demand for products and services, the degree of competition by traditional and nontraditional competitors, changes in banking regulations, tax laws, prices, levies and assessments, the impact of technological advances, and trends in customer behavior as well as their ability to repay loans. 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.

8

Exhibit 99 (b)

BALANCE SHEETS -- UNAUDITED
BOK FINANCIAL CORPORATION
(In thousands)
 
Sept. 30, 2017
 
June 30, 2017
 
Sept. 30, 2016
ASSETS
 
 
 
 
 
Cash and due from banks
$
547,203

 
$
561,587

 
$
535,916

Interest-bearing cash and cash equivalents
1,926,779

 
2,078,831

 
2,080,978

Trading securities
614,117

 
441,414

 
546,615

Investment securities
466,562

 
490,426

 
546,457

Available for sale securities
8,383,199

 
8,341,041

 
8,862,283

Fair value option securities
819,531

 
445,169

 
222,409

Restricted equity securities
347,542

 
311,033

 
333,391

Residential mortgage loans held for sale
275,643

 
287,259

 
447,592

Loans:
 
 
 
 
 
Commercial
10,795,934

 
10,637,955

 
10,120,163

Commercial real estate
3,518,142

 
3,688,592

 
3,793,598

Residential mortgage
1,945,750

 
1,939,198

 
1,872,793

Personal
947,008

 
917,900

 
678,232

Total loans
17,206,834

 
17,183,645

 
16,464,786

Allowance for loan losses
(247,703
)
 
(250,061
)
 
(245,103
)
Loans, net of allowance
16,959,131

 
16,933,584

 
16,219,683

Premises and equipment, net
320,060

 
321,038

 
318,196

Receivables
314,251

 
295,042

 
650,368

Goodwill
446,697

 
446,697

 
382,739

Intangible assets, net
39,013

 
40,755

 
41,977

Mortgage servicing rights
245,858

 
245,239

 
203,621

Real estate and other repossessed assets, net
32,535

 
39,436

 
31,941

Derivative contracts, net
352,559

 
280,289

 
655,078

Cash surrender value of bank-owned life insurance
314,201

 
312,774

 
310,211

Receivable on unsettled securities sales
230,225

 
33,177

 
19,642

Other assets
370,409

 
358,741

 
370,134

TOTAL ASSETS
$
33,005,515

 
$
32,263,532

 
$
32,779,231

 
 
 
 
 
 
LIABILITIES AND EQUITY
 
 
 
 
 
Deposits:
 
 
 
 
 
Demand
$
9,185,481

 
$
9,568,895

 
$
8,681,364

Interest-bearing transaction
10,025,084

 
10,087,139

 
9,824,160

Savings
465,225

 
464,318

 
420,349

Time
2,172,289

 
2,196,122

 
2,169,631

Total deposits
21,848,079

 
22,316,474

 
21,095,504

Funds purchased
62,356

 
67,990

 
109,031

Repurchase agreements
328,189

 
396,333

 
504,573

Other borrowings
6,241,275

 
5,232,343

 
6,533,443

Subordinated debentures
144,668

 
144,658

 
144,631

Accrued interest, taxes and expense
152,029

 
133,198

 
191,276

Due on unsettled securities purchases
160,781

 
32,636

 
677

Derivative contracts, net
336,327

 
285,819

 
573,987

Other liabilities
217,372

 
204,536

 
193,698

TOTAL LIABILITIES
29,491,076

 
28,813,987

 
29,346,820

Shareholders' equity:
 
 
 
 
 
Capital, surplus and retained earnings
3,482,057

 
3,414,505

 
3,302,584

Accumulated other comprehensive income
6,757

 
7,964

 
95,727

TOTAL SHAREHOLDERS' EQUITY
3,488,814

 
3,422,469

 
3,398,311

Non-controlling interests
25,625

 
27,076

 
34,100

TOTAL EQUITY
3,514,439

 
3,449,545

 
3,432,411

TOTAL LIABILITIES AND EQUITY
$
33,005,515

 
$
32,263,532

 
$
32,779,231


9



AVERAGE BALANCE SHEETS -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands)
 
Three Months Ended
 
Sept. 30, 2017
 
June 30, 2017
 
Mar. 31, 2017
 
Dec. 31, 2016
 
Sept. 30, 2016
ASSETS
 
 
 
 
 
 
 
 
 
Interest-bearing cash and cash equivalents
$
1,965,645

 
$
2,007,746

 
$
2,087,964

 
$
2,032,785

 
$
2,047,991

Trading securities
491,613

 
456,028

 
579,549

 
476,498

 
366,545

Investment securities
475,705

 
499,372

 
530,936

 
542,869

 
552,592

Available for sale securities
8,428,353

 
8,384,057

 
8,567,049

 
8,766,555

 
8,862,590

Fair value option securities
684,571

 
476,102

 
416,524

 
210,733

 
266,998

Restricted equity securities
328,677

 
295,743

 
312,498

 
334,114

 
335,812

Residential mortgage loans held for sale
256,343

 
245,401

 
220,325

 
345,066

 
445,930

Loans:
 
 
 
 
 
 
 
 
 
Commercial
10,827,198

 
10,604,456

 
10,414,579

 
10,228,095

 
10,109,692

Commercial real estate
3,528,330

 
3,676,976

 
3,903,850

 
3,749,393

 
3,789,673

Residential mortgage
1,951,385

 
1,933,091

 
1,962,759

 
1,919,296

 
1,870,855

Personal
949,750

 
915,010

 
854,637

 
826,804

 
677,530

Total loans
17,256,663

 
17,129,533

 
17,135,825

 
16,723,588

 
16,447,750

Allowance for loan losses
(250,590
)
 
(251,632
)
 
(249,379
)
 
(246,977
)
 
(247,901
)
Total loans, net
17,006,073

 
16,877,901

 
16,886,446

 
16,476,611

 
16,199,849

Total earning assets
29,636,980

 
29,242,350

 
29,601,291

 
29,185,231

 
29,078,307

Cash and due from banks
546,653

 
530,352

 
547,104

 
578,694

 
511,534

Derivative contracts, net
238,583

 
248,168

 
401,886

 
681,455

 
766,671

Cash surrender value of bank-owned life insurance
313,079

 
311,310

 
309,223

 
309,532

 
308,670

Receivable on unsettled securities sales
76,622

 
79,248

 
62,641

 
33,813

 
259,906

Other assets
2,196,253

 
1,957,143

 
2,032,844

 
2,172,351

 
1,721,385

TOTAL ASSETS
$
33,008,170

 
$
32,368,571

 
$
32,954,989

 
$
32,961,076

 
$
32,646,473

 
 
 
 
 
 
 
 
 
 
LIABILITIES AND EQUITY
 
 
 
 
 
 
 
 
 
Deposits:
 
 
 
 
 
 
 
 
 
Demand
$
9,389,849

 
$
9,338,683

 
$
9,101,763

 
$
9,124,595

 
$
8,497,037

Interest-bearing transaction
10,088,522

 
10,087,640

 
10,567,475

 
9,980,132

 
9,650,618

Savings
464,130

 
461,586

 
441,254

 
421,654

 
420,009

Time
2,176,820

 
2,204,422

 
2,258,930

 
2,177,035

 
2,197,350

Total deposits
22,119,321

 
22,092,331

 
22,369,422

 
21,703,416

 
20,765,014

Funds purchased
49,774

 
63,263

 
55,508

 
62,004

 
68,280

Repurchase agreements
361,512

 
427,353

 
523,561

 
560,891

 
522,822

Other borrowings
6,162,641

 
5,572,031

 
5,737,955

 
6,072,150

 
6,342,369

Subordinated debentures
144,663

 
144,654

 
144,644

 
144,635

 
255,890

Derivative contracts, net
221,371

 
178,695

 
405,444

 
682,808

 
747,187

Due on unsettled securities purchases
145,155

 
157,438

 
91,529

 
77,575

 
200,574

Other liabilities
319,092

 
323,373

 
299,534

 
321,404

 
352,671

TOTAL LIABILITIES
29,523,529

 
28,959,138

 
29,627,597

 
29,624,883

 
29,254,807

Total equity
3,484,641

 
3,409,433

 
3,327,392

 
3,336,193

 
3,391,666

TOTAL LIABILITIES AND EQUITY
$
33,008,170

 
$
32,368,571

 
$
32,954,989

 
$
32,961,076

 
$
32,646,473


10



STATEMENTS OF EARNINGS -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands, except per share data)
 
Three Months Ended
 
Nine Months Ended
 
September 30,
 
September 30,
 
2017
 
2016
 
2017
 
2016
 
 
 
 
 
 
 
 
Interest revenue
$
255,413

 
$
209,317

 
$
716,984

 
$
613,380

Interest expense
36,961

 
21,471

 
92,146

 
60,350

Net interest revenue
218,452

 
187,846


624,838


553,030

Provision for credit losses

 
10,000

 

 
65,000

Net interest revenue after provision for credit losses
218,452

 
177,846


624,838


488,030

Other operating revenue:
 
 
 
 
 
 
 
Brokerage and trading revenue
33,169

 
38,006

 
98,556

 
109,877

Transaction card revenue
37,826

 
33,933

 
105,249

 
101,237

Fiduciary and asset management revenue
40,687

 
34,073

 
121,126

 
100,942

Deposit service charges and fees
23,209

 
23,668

 
69,593

 
68,828

Mortgage banking revenue
24,890

 
38,516

 
80,357

 
105,500

Other revenue
13,670

 
13,080

 
40,406

 
38,336

Total fees and commissions
173,451

 
181,276


515,287


524,720

Other gains (losses), net
(1,283
)
 
2,442

 
8,452

 
5,309

Gain on derivatives, net
1,033

 
2,226

 
3,824

 
20,130

Gain (loss) on fair value option securities, net
661

 
(3,355
)
 
1,505

 
10,367

Change in fair value of mortgage servicing rights
(639
)
 
2,327

 
(5,726
)
 
(41,944
)
Gain on available for sale securities, net
2,487

 
2,394

 
4,916

 
11,684

Total other operating revenue
175,710

 
187,310


528,258


530,266

Other operating expense:
 
 
 
 
 
 
 
Personnel
147,910

 
139,212

 
428,079

 
411,987

Business promotion
7,105

 
6,839

 
21,560

 
19,238

Professional fees and services
11,887

 
14,038

 
35,723

 
39,955

Net occupancy and equipment
21,325

 
20,111

 
64,074

 
58,554

Insurance
6,005

 
9,390

 
13,098

 
23,784

Data processing and communications
37,327

 
33,331

 
108,559

 
98,150

Printing, postage and supplies
3,917

 
3,790

 
11,908

 
11,586

Net losses (gains) and operating expenses of repossessed assets
6,071

 
(926
)
 
9,347

 
1,732

Amortization of intangible assets
1,744

 
1,521

 
5,349

 
5,304

Mortgage banking costs
13,450

 
15,963

 
38,525

 
44,039

Other expense
9,193

 
14,819

 
25,308

 
37,714

Total other operating expense
265,934

 
258,088


761,530


752,043

 
 
 
 
 
 
 
 
Net income before taxes
128,228

 
107,068


391,566


266,253

Federal and state income taxes
42,438

 
31,956

 
128,246

 
83,881

 
 
 
 
 
 
 
 
Net income
85,790

 
75,112


263,320


182,372

Net income (loss) attributable to non-controlling interests
141

 
835

 
1,168

 
(270
)
Net income attributable to BOK Financial Corporation shareholders
$
85,649

 
$
74,277


$
262,152


$
182,642

 
 
 
 
 
 
 
 
Average shares outstanding:
 
 
 
 
 
 
 
Basic
64,742,822

 
65,085,392

 
64,729,391

 
65,208,774

Diluted
64,805,172

 
65,157,841

 
64,793,893

 
65,263,566

 
 
 
 
 
 
 
 
Net income per share:
 
 
 
 
 
 
 
Basic
$
1.31

 
$
1.13

 
$
4.01

 
$
2.77

Diluted
$
1.31

 
$
1.13

 
$
4.00

 
$
2.76


11



FINANCIAL HIGHLIGHTS -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands, except ratio and share data)
 
Three Months Ended
 
Sept. 30, 2017
 
June 30, 2017
 
Mar. 31, 2017
 
Dec. 31, 2016
 
Sept. 30, 2016
Capital:
 
 
 
 
 
 
 
 
 
Period-end shareholders' equity
$
3,488,814

 
$
3,422,469

 
$
3,341,744

 
$
3,274,854

 
$
3,398,311

Risk weighted assets
$
25,409,728

 
$
25,130,802

 
$
24,901,019

 
$
25,274,848

 
$
24,358,385

Risk-based capital ratios:
 
 
 
 
 
 
 
 
 
Common equity tier 1
11.90
%
 
11.76
%
 
11.59
%
 
11.21
%
 
11.99
%
Tier 1
11.90
%
 
11.76
%
 
11.59
%
 
11.21
%
 
11.99
%
Total capital
13.47
%
 
13.36
%
 
13.25
%
 
12.81
%
 
13.65
%
Leverage ratio
9.30
%
 
9.27
%
 
8.89
%
 
8.72
%
 
9.06
%
Tangible common equity ratio1
9.23
%
 
9.24
%
 
8.88
%
 
8.61
%
 
9.19
%
 
 
 
 
 
 
 
 
 
 
Common stock:
 
 
 
 
 
 
 
 
 
Book value per share
$
53.30

 
$
52.32

 
$
51.09

 
$
50.12

 
$
51.56

Tangible book value per share
45.88

 
44.87

 
43.63

 
42.53

 
45.12

Market value per share:
 
 
 
 
 
 
 
 
 
High
$
90.69

 
$
88.31

 
$
85.25

 
$
85.00

 
$
70.05

Low
$
77.10

 
$
74.09

 
$
73.44

 
$
67.11

 
$
56.36

Cash dividends paid
$
28,655

 
$
28,652

 
$
28,646

 
$
28,860

 
$
28,181

Dividend payout ratio
33.46
%
 
32.50
%
 
32.42
%
 
57.69
%
 
37.94
%
Shares outstanding, net
65,456,786

 
65,416,403

 
65,408,019

 
65,337,432

 
65,910,454

Stock buy-back program:
 
 
 
 
 
 
 
 
 
Shares repurchased

 

 

 
700,000

 

Amount
$

 
$

 
$

 
$
49,021

 
$

Average price per share
$

 
$

 
$

 
$
70.03

 
$

 
 
 
 
 
 
 
 
 
 
Performance ratios (quarter annualized):
Return on average assets
1.03
%
 
1.09
%
 
1.09
%
 
0.60
%
 
0.91
%
Return on average equity
9.83
%
 
10.46
%
 
10.86
%
 
6.03
%
 
8.80
%
Net interest margin
3.01
%
 
2.89
%
 
2.81
%
 
2.69
%
 
2.64
%
Efficiency ratio
66.77
%
 
64.61
%
 
65.77
%
 
72.93
%
 
68.88
%
 
 
 
 
 
 
 
 
 
 
Reconciliation of non-GAAP measures:
1      Tangible common equity ratio:
 
 
 
 
 
 
 
 
 
Total shareholders' equity
$
3,488,814

 
$
3,422,469

 
$
3,341,744

 
$
3,274,854

 
$
3,398,311

Less: Goodwill and intangible assets, net
485,710

 
487,452

 
488,294

 
495,830

 
424,716

Tangible common equity
$
3,003,104

 
$
2,935,017

 
$
2,853,450

 
$
2,779,024

 
$
2,973,595

 
 
 
 
 
 
 
 
 
 
Total assets
$
33,005,515

 
$
32,263,532

 
$
32,628,932

 
$
32,772,281

 
$
32,779,231

Less: Goodwill and intangible assets, net
485,710

 
487,452

 
488,294

 
495,830

 
424,716

Tangible assets
$
32,519,805

 
$
31,776,080

 
$
32,140,638

 
$
32,276,451

 
$
32,354,515

 
 
 
 
 
 
 
 
 
 
Tangible common equity ratio
9.23
%
 
9.24
%
 
8.88
%
 
8.61
%
 
9.19
%
 
 
 
 
 
 
 
 
 
 

12



FINANCIAL HIGHLIGHTS -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands, except ratio and share data)
 
Three Months Ended
 
Sept. 30, 2017
 
June 30, 2017
 
Mar. 31, 2017
 
Dec. 31, 2016
 
Sept. 30, 2016
Other data:
 
 
 
 
 
 
 
 
 
Fiduciary assets
$
45,177,185

 
$
45,089,153

 
$
44,992,920

 
$
42,378,053

 
$
41,810,943

Tax equivalent interest
$
4,314

 
$
4,330

 
$
4,428

 
$
4,389

 
$
4,455

Net unrealized gain (loss) on available for sale securities
$
14,061

 
$
16,041

 
$
(5,537
)
 
$
(14,899
)
 
$
159,533

 
 
 
 
 
 
 
 
 
 
Mortgage banking:
 
 
 
 
 
 
 
 
 
Mortgage production revenue
$
8,329

 
$
13,840

 
$
8,543

 
$
11,937

 
$
21,958

 
 
 
 
 
 
 
 
 
 
Mortgage loans funded for sale
$
832,796

 
$
902,978

 
$
711,019

 
$
1,189,975

 
$
1,864,583

Add: current period-end outstanding commitments
334,337

 
362,088

 
381,732

 
318,359

 
630,804

Less: prior period end outstanding commitments
362,088

 
381,732

 
318,359

 
630,804

 
965,631

Total mortgage production volume
$
805,045

 
$
883,334

 
$
774,392

 
$
877,530

 
$
1,529,756

 
 
 
 
 
 
 
 
 
 
Mortgage loan refinances to mortgage loans funded for sale
38
%
 
33
%
 
44
%
 
63
%
 
51
%
Gain on sale margin
1.03
%
 
1.57
%
 
1.10
%
 
1.36
%
 
1.44
%
 
 
 
 
 
 
 
 
 
 
Mortgage servicing revenue
$
16,561

 
$
16,436

 
$
16,648

 
$
16,477

 
$
16,558

Average outstanding principal balance of mortgage loans service for others
22,079,177

 
22,055,127

 
22,006,295

 
21,924,552

 
21,514,962

Average mortgage servicing revenue rates
0.30
%
 
0.30
%
 
0.31
%
 
0.30
%
 
0.31
%
 
 
 
 
 
 
 
 
 
 
Gain (loss) on mortgage servicing rights, net of economic hedge:
Gain (loss) on mortgage hedge derivative contracts, net
$
1,025

 
$
3,241

 
$
(450
)
 
$
(35,868
)
 
$
2,268

Gain (loss) on fair value option securities, net
661

 
1,984

 
(1,140
)
 
(20,922
)
 
(3,355
)
Gain (loss) on economic hedge of mortgage servicing rights
1,686

 
5,225

 
(1,590
)
 
(56,790
)
 
(1,087
)
Gain (loss) on changes in fair value of mortgage servicing rights
(639
)
 
(6,943
)
 
1,856

 
39,751

 
2,327

Gain (loss) on changes in fair value of mortgage servicing rights, net of economic hedges, included in other operating revenue
1,047

 
(1,718
)
 
266

 
(17,039
)
 
1,240

Net interest revenue on fair value option securities2
2,543

 
1,965

 
1,271

 
114

 
861

Total economic benefit (cost) of changes in the fair value of mortgage servicing rights, net of economic hedges
$
3,590

 
$
247

 
$
1,537

 
$
(16,925
)
 
$
2,101

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

13



QUARTERLY EARNINGS TREND -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands, except ratio and per share data)
 
Three Months Ended
 
Sept. 30, 2017
 
June 30, 2017
 
Mar. 31, 2017
 
Dec. 31, 2016
 
Sept. 30, 2016
 
 
 
 
 
 
 
 
 
 
Interest revenue
$
255,413

 
$
235,181

 
$
226,390

 
$
215,737

 
$
209,317

Interest expense
36,961

 
29,977

 
25,208

 
21,539

 
21,471

Net interest revenue
218,452

 
205,204

 
201,182

 
194,198

 
187,846

Provision for credit losses

 

 

 

 
10,000

Net interest revenue after provision for credit losses
218,452

 
205,204

 
201,182

 
194,198

 
177,846

Other operating revenue:
 
 
 
 
 
 
 
 
 
Brokerage and trading revenue
33,169

 
31,764

 
33,623

 
28,500

 
38,006

Transaction card revenue
37,826

 
35,296

 
32,127

 
34,521

 
33,933

Fiduciary and asset management revenue
40,687

 
41,808

 
38,631

 
34,535

 
34,073

Deposit service charges and fees
23,209

 
23,354

 
23,030

 
23,365

 
23,668

Mortgage banking revenue
24,890

 
30,276

 
25,191

 
28,414

 
38,516

Other revenue
13,670

 
14,984

 
11,752

 
12,693

 
13,080

Total fees and commissions
173,451

 
177,482

 
164,354

 
162,028

 
181,276

Other gains (losses), net
(1,283
)
 
6,108

 
3,627

 
(1,279
)
 
2,442

Gain (loss) on derivatives, net
1,033

 
3,241

 
(450
)
 
(35,815
)
 
2,226

Gain (loss) on fair value option securities, net
661

 
1,984

 
(1,140
)
 
(20,922
)
 
(3,355
)
Change in fair value of mortgage servicing rights
(639
)
 
(6,943
)
 
1,856

 
39,751

 
2,327

Gain (loss) on available for sale securities, net
2,487

 
380

 
2,049

 
(9
)
 
2,394

Total other operating revenue
175,710

 
182,252

 
170,296

 
143,754

 
187,310

Other operating expense:
 
 
 
 
 
 
 
 
 
Personnel
147,910

 
143,744

 
136,425

 
141,132

 
139,212

Business promotion
7,105

 
7,738

 
6,717

 
7,344

 
6,839

Charitable contributions to BOKF Foundation

 

 

 
2,000

 

Professional fees and services
11,887

 
12,419

 
11,417

 
16,828

 
14,038

Net occupancy and equipment
21,325

 
21,125

 
21,624

 
21,470

 
20,111

Insurance
6,005

 
689

 
6,404

 
8,705

 
9,390

Data processing and communications
37,327

 
36,330

 
34,902

 
33,691

 
33,331

Printing, postage and supplies
3,917

 
4,140

 
3,851

 
3,998

 
3,790

Net losses (gains) and operating expenses of repossessed assets
6,071

 
2,267

 
1,009

 
1,627

 
(926
)
Amortization of intangible assets
1,744

 
1,803

 
1,802

 
1,558

 
1,521

Mortgage banking costs
13,450

 
12,072

 
13,003

 
17,348

 
15,963

Other expense
9,193

 
8,558

 
7,557

 
9,846

 
14,819

Total other operating expense
265,934

 
250,885

 
244,711

 
265,547

 
258,088

Net income before taxes
128,228

 
136,571

 
126,767

 
72,405

 
107,068

Federal and state income taxes
42,438

 
47,705

 
38,103

 
22,496

 
31,956

Net income
85,790

 
88,866

 
88,664

 
49,909

 
75,112

Net income (loss) attributable to non-controlling interests
141

 
719

 
308

 
(117
)
 
835

Net income attributable to BOK Financial Corporation shareholders
$
85,649

 
$
88,147

 
$
88,356

 
$
50,026

 
$
74,277

 
 
 
 
 
 
 
 
 
 
Average shares outstanding:
 
 
 
 
 
 
 
 
 
Basic
64,742,822

 
64,729,752

 
64,715,964

 
64,719,018

 
65,085,392

Diluted
64,805,172

 
64,793,134

 
64,783,737

 
64,787,728

 
65,157,841

Net income per share:
 
 
 
 
 
 
 
 
 
Basic
$
1.31

 
$
1.35

 
$
1.35

 
$
0.76

 
$
1.13

Diluted
$
1.31

 
$
1.35

 
$
1.35

 
$
0.76

 
$
1.13


14



LOANS TREND -- UNAUDITED
BOK FINANCIAL CORPORATION
(In thousands)
 
 
Sept. 30, 2017
 
June 30, 2017
 
Mar. 31, 2017
 
Dec. 31, 2016
 
Sept. 30, 2016
Commercial:
 
 
 
 
 
 
 
 
 
 
Energy
 
$
2,867,981

 
$
2,847,240

 
$
2,537,112

 
$
2,497,868

 
$
2,520,804

Services
 
2,967,513

 
2,958,827

 
3,013,375

 
3,108,990

 
2,936,599

Healthcare
 
2,239,451

 
2,221,518

 
2,265,604

 
2,201,916

 
2,085,046

Wholesale/retail
 
1,658,098

 
1,543,695

 
1,506,243

 
1,576,818

 
1,602,030

Manufacturing
 
519,446

 
546,137

 
543,430

 
514,975

 
499,486

Other commercial and industrial
 
543,445

 
520,538

 
461,346

 
490,257

 
476,198

Total commercial
 
10,795,934

 
10,637,955

 
10,327,110

 
10,390,824

 
10,120,163

 
 
 
 
 
 
 
 
 
 
 
Commercial real estate:
 
 

 
 

 
 

 
 

 
 

Retail
 
725,865

 
722,805

 
745,046

 
761,888

 
801,377

Multifamily
 
999,009

 
952,380

 
922,991

 
903,272

 
873,773

Office
 
797,089

 
862,973

 
860,889

 
798,888

 
752,705

Industrial
 
591,080

 
693,635

 
871,463

 
871,749

 
838,021

Residential construction and land development
 
112,102

 
141,592

 
135,994

 
135,533

 
159,946

Other commercial real estate
 
292,997

 
315,207

 
334,680

 
337,716

 
367,776

Total commercial real estate
 
3,518,142

 
3,688,592

 
3,871,063

 
3,809,046

 
3,793,598

 
 
 
 
 
 
 
 
 
 
 
Residential mortgage:
 
 

 
 

 
 

 
 

 
 

Permanent mortgage
 
1,013,965

 
989,040

 
977,743

 
1,006,820

 
969,558

Permanent mortgages guaranteed by U.S. government agencies
 
187,370

 
191,729

 
204,181

 
199,387

 
190,309

Home equity
 
744,415

 
758,429

 
764,350

 
743,625

 
712,926

Total residential mortgage
 
1,945,750

 
1,939,198

 
1,946,274

 
1,949,832

 
1,872,793

 
 
 
 
 
 
 
 
 
 
 
Personal
 
947,008

 
917,900

 
847,459

 
839,958

 
678,232

 
 
 
 
 
 
 
 
 
 
 
Total
 
$
17,206,834

 
$
17,183,645

 
$
16,991,906

 
$
16,989,660

 
$
16,464,786



15



LOANS BY PRINCIPAL MARKET AREA -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands)
 
Sept. 30, 2017
 
June 30, 2017
 
Mar. 31, 2017
 
Dec. 31, 2016
 
Sept. 30, 2016
 
 
 
 
 
 
 
 
 
 
Bank of Oklahoma:
 
 
 
 
 
 
 
 
 
Commercial
$
3,408,973

 
$
3,369,967

 
$
3,189,183

 
$
3,370,259

 
$
3,545,924

Commercial real estate
712,915

 
667,932

 
691,332

 
684,381

 
795,806

Residential mortgage
1,405,900

 
1,398,021

 
1,404,054

 
1,407,197

 
1,401,166

Personal
322,320

 
318,016

 
310,708

 
303,823

 
271,420

Total Bank of Oklahoma
5,850,108

 
5,753,936

 
5,595,277

 
5,765,660

 
6,014,316

 
 
 
 
 
 
 
 
 
 
Bank of Texas:
 
 
 
 
 
 
 
 
 
Commercial
4,434,595

 
4,339,634

 
4,148,316

 
4,022,455

 
3,903,218

Commercial real estate
1,236,702

 
1,360,164

 
1,452,988

 
1,415,011

 
1,400,709

Residential mortgage
229,993

 
232,074

 
231,647

 
233,981

 
229,345

Personal
375,173

 
354,222

 
312,092

 
306,748

 
278,167

Total Bank of Texas
6,276,463

 
6,286,094

 
6,145,043

 
5,978,195

 
5,811,439

 
 
 
 
 
 
 
 
 
 
Bank of Albuquerque:
 
 
 
 
 
 
 
 
 
Commercial
367,747

 
369,370

 
407,403

 
399,256

 
398,147

Commercial real estate
319,208

 
324,405

 
307,927

 
284,603

 
299,785

Residential mortgage
101,983

 
103,849

 
106,432

 
108,058

 
110,478

Personal
12,953

 
12,439

 
11,305

 
11,483

 
11,333

Total Bank of Albuquerque
801,891

 
810,063

 
833,067

 
803,400

 
819,743

 
 
 
 
 
 
 
 
 
 
Bank of Arkansas:
 
 
 
 
 
 
 
 
 
Commercial
91,051

 
85,020

 
88,010

 
86,577

 
83,544

Commercial real estate
80,917

 
73,943

 
74,469

 
73,616

 
72,649

Residential mortgage
6,318

 
6,395

 
6,829

 
7,015

 
6,936

Personal
10,388

 
11,993

 
6,279

 
6,524

 
6,757

Total Bank of Arkansas
188,674

 
177,351

 
175,587

 
173,732

 
169,886

 
 
 
 
 
 
 
 
 
 
Colorado State Bank & Trust:
 
 
 
 
 
 
 
 
 
Commercial
1,124,200

 
1,065,780

 
998,216

 
1,018,208

 
1,013,314

Commercial real estate
186,427

 
255,379

 
266,218

 
265,264

 
254,078

Residential mortgage
63,734

 
63,346

 
62,313

 
59,631

 
59,838

Personal
60,513

 
56,187

 
49,523

 
50,372

 
42,901

Total Colorado State Bank & Trust
1,434,874

 
1,440,692

 
1,376,270

 
1,393,475

 
1,370,131

 
 
 
 
 
 
 
 
 
 
Bank of Arizona:
 
 
 
 
 
 
 
 
 
Commercial
634,809

 
617,759

 
643,222

 
686,253

 
680,447

Commercial real estate
706,188

 
705,858

 
737,088

 
747,409

 
726,542

Residential mortgage
40,730

 
37,034

 
36,737

 
36,265

 
39,206

Personal
55,050

 
55,528

 
51,386

 
52,553

 
31,205

Total Bank of Arizona
1,436,777

 
1,416,179

 
1,468,433

 
1,522,480

 
1,477,400

 
 
 
 
 
 
 
 
 
 
Mobank (Kansas City):
 
 
 
 
 
 
 
 
 
Commercial
734,559

 
790,425

 
852,760

 
807,816

 
495,569

Commercial real estate
275,785

 
300,911

 
341,041

 
338,762

 
244,029

Residential mortgage
97,092

 
98,479

 
98,262

 
97,685

 
25,824

Personal
110,611

 
109,515

 
106,166

 
108,455

 
36,449

Total Mobank (Kansas City)
1,218,047

 
1,299,330

 
1,398,229

 
1,352,718

 
801,871

 
 
 
 
 
 
 
 
 
 
TOTAL BOK FINANCIAL
$
17,206,834

 
$
17,183,645

 
$
16,991,906

 
$
16,989,660

 
$
16,464,786


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


16



DEPOSITS BY PRINCIPAL MARKET AREA -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands)
 
Sept. 30, 2017
 
June 30, 2017
 
Mar. 31, 2017
 
Dec. 31, 2016
 
Sept. 30, 2016
Bank of Oklahoma:
 
 
 
 
 
 
 
 
 
    Demand
$
4,061,612

 
$
4,353,421

 
$
4,320,666

 
$
3,993,170

 
$
4,158,273

    Interest-bearing:
 
 
 
 
 
 
 
 
 
       Transaction
5,909,259

 
5,998,787

 
6,114,288

 
6,345,536

 
5,701,983

       Savings
265,023

 
263,664

 
265,014

 
241,696

 
242,959

       Time
1,131,547

 
1,170,014

 
1,189,144

 
1,118,355

 
1,091,464

    Total interest-bearing
7,305,829

 
7,432,465

 
7,568,446

 
7,705,587

 
7,036,406

Total Bank of Oklahoma
11,367,441

 
11,785,886

 
11,889,112

 
11,698,757

 
11,194,679

 
 
 
 
 
 
 
 
 
 
Bank of Texas:
 
 
 
 
 
 
 
 
 
    Demand
3,094,184

 
3,121,890

 
3,091,258

 
3,137,009

 
2,734,981

    Interest-bearing:
 
 
 
 
 
 
 
 
 
       Transaction
2,272,987

 
2,272,185

 
2,317,576

 
2,388,812

 
2,240,040

       Savings
93,400

 
91,491

 
89,640

 
83,101

 
84,642

       Time
521,072

 
502,128

 
511,037

 
535,642

 
528,380

    Total interest-bearing
2,887,459

 
2,865,804

 
2,918,253

 
3,007,555

 
2,853,062

Total Bank of Texas
5,981,643

 
5,987,694

 
6,009,511

 
6,144,564

 
5,588,043

 
 
 
 
 
 
 
 
 
 
Bank of Albuquerque:
 
 
 
 
 
 
 
 
 
    Demand
659,793

 
612,117

 
593,117

 
627,979

 
584,681

    Interest-bearing:
 
 
 
 
 
 
 
 
 
       Transaction
551,884

 
558,523

 
623,677

 
590,571

 
555,326

       Savings
53,532

 
54,136

 
53,683

 
49,963

 
54,480

       Time
224,773

 
229,616

 
233,506

 
238,408

 
244,706

    Total interest-bearing
830,189

 
842,275

 
910,866

 
878,942

 
854,512

Total Bank of Albuquerque
1,489,982

 
1,454,392

 
1,503,983

 
1,506,921

 
1,439,193

 
 
 
 
 
 
 
 
 
 
Bank of Arkansas:
 
 
 
 
 
 
 
 
 
    Demand
31,442

 
40,511

 
42,622

 
26,389

 
32,203

    Interest-bearing:
 
 
 
 
 
 
 
 
 
       Transaction
126,746

 
129,848

 
106,804

 
105,232

 
313,480

       Savings
1,876

 
2,135

 
2,304

 
2,192

 
2,051

       Time
14,434

 
14,876

 
15,067

 
16,696

 
17,534

    Total interest-bearing
143,056

 
146,859

 
124,175

 
124,120

 
333,065

Total Bank of Arkansas
174,498

 
187,370

 
166,797

 
150,509

 
365,268

 
 
 
 
 
 
 
 
 
 
Colorado State Bank & Trust:
 
 
 
 
 
 
 
 
 
    Demand
540,300

 
577,617

 
601,778

 
576,000

 
517,063

    Interest-bearing:
 
 
 
 
 
 
 
 
 
       Transaction
628,807

 
626,343

 
610,510

 
616,679

 
623,055

       Savings
34,776

 
35,651

 
37,801

 
32,866

 
31,613

       Time
231,927

 
228,458

 
234,740

 
242,782

 
247,667

    Total interest-bearing
895,510

 
890,452

 
883,051

 
892,327

 
902,335

Total Colorado State Bank & Trust
1,435,810

 
1,468,069

 
1,484,829

 
1,468,327

 
1,419,398

 
 
 
 
 
 
 
 
 
 

17



DEPOSITS BY PRINCIPAL MARKET AREA -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands)
 
Sept. 30, 2017
 
June 30, 2017
 
Mar. 31, 2017
 
Dec. 31, 2016
 
Sept. 30, 2016
Bank of Arizona:
 
 
 
 
 
 
 
 
 
    Demand
335,740

 
366,866

 
342,854

 
366,755

 
418,718

    Interest-bearing:
 
 
 
 
 
 
 
 
 
       Transaction
174,010

 
154,457

 
180,254

 
305,099

 
303,750

       Savings
4,105

 
3,638

 
3,858

 
2,973

 
2,959

       Time
20,831

 
19,911

 
26,112

 
27,765

 
27,935

    Total interest-bearing
198,946

 
178,006

 
210,224

 
335,837

 
334,644

Total Bank of Arizona
534,686

 
544,872

 
553,078

 
702,592

 
753,362

 
 
 
 
 
 
 
 
 
 
Mobank (Kansas City):
 
 
 
 
 
 
 
 
 
    Demand
462,410

 
496,473

 
514,278

 
508,418

 
235,445

    Interest-bearing:
 
 
 
 
 
 
 
 
 
       Transaction
361,391

 
346,996

 
406,105

 
513,176

 
86,526

       Savings
12,513

 
13,603

 
13,424

 
12,679

 
1,645

       Time
27,705

 
31,119

 
34,242

 
42,152

 
11,945

    Total interest-bearing
401,609

 
391,718

 
453,771

 
568,007

 
100,116

Total Mobank (Kansas City)
864,019

 
888,191

 
968,049

 
1,076,425

 
335,561

 
 
 
 
 
 
 
 
 
 
TOTAL BOK FINANCIAL
$
21,848,079

 
$
22,316,474

 
$
22,575,359

 
$
22,748,095

 
$
21,095,504


18



NET INTEREST MARGIN TREND -- UNAUDITED
BOK FINANCIAL CORPORATION
 
Three Months Ended
 
Sept. 30, 2017
 
June 30, 2017
 
Mar. 31, 2017
 
Dec. 31, 2016
 
Sept. 30, 2016
 
 
 
 
 
 
 
 
 
 
TAX-EQUIVALENT ASSETS YIELDS
 
 
 
 
 
 
 
 
 
Interest-bearing cash and cash equivalents
1.29
%
 
1.04
%
 
0.82
%
 
0.55
%
 
0.51
%
Trading securities
3.47
%
 
3.23
%
 
3.87
%
 
3.91
%
 
2.71
%
Investment securities:
 
 
 
 
 
 
 
 
 
    Taxable
5.31
%
 
5.34
%
 
5.44
%
 
5.39
%
 
5.34
%
    Tax-exempt
2.60
%
 
2.51
%
 
2.45
%
 
2.33
%
 
2.26
%
Total investment securities
3.86
%
 
3.76
%
 
3.70
%
 
3.60
%
 
3.51
%
Available for sale securities:
 
 
 
 
 
 
 
 
 
    Taxable
2.16
%
 
2.09
%
 
2.02
%
 
1.98
%
 
1.99
%
    Tax-exempt
5.27
%
 
6.09
%
 
5.37
%
 
5.27
%
 
5.47
%
Total available for sale securities
2.17
%
 
2.11
%
 
2.05
%
 
2.00
%
 
2.01
%
Fair value option securities
2.97
%
 
2.92
%
 
2.27
%
 
0.99
%
 
1.70
%
Restricted equity securities
5.87
%
 
5.95
%
 
5.52
%
 
5.45
%
 
5.37
%
Residential mortgage loans held for sale
3.36
%
 
3.92
%
 
3.35
%
 
3.31
%
 
3.28
%
Loans
4.31
%
 
4.03
%
 
3.88
%
 
3.67
%
 
3.63
%
Allowance for loan losses
 
 
 
 
 
 
 
 
 
Loans, net of allowance
4.38
%
 
4.09
%
 
3.94
%
 
3.72
%
 
3.69
%
Total tax-equivalent yield on earning assets
3.50
%
 
3.30
%
 
3.15
%
 
2.98
%
 
2.93
%
 
 
 
 
 
 
 
 
 
 
COST OF INTEREST-BEARING LIABILITIES
 
 
 
 
 
 
 
 
Interest-bearing deposits:
 
 
 
 
 
 
 
 
 
  Interest-bearing transaction
0.32
%
 
0.26
%
 
0.20
%
 
0.16
%
 
0.14
%
  Savings
0.08
%
 
0.08
%
 
0.08
%
 
0.09
%
 
0.09
%
  Time
1.16
%
 
1.11
%
 
1.09
%
 
1.12
%
 
1.14
%
Total interest-bearing deposits
0.45
%
 
0.40
%
 
0.35
%
 
0.32
%
 
0.32
%
Funds purchased
0.92
%
 
0.61
%
 
0.47
%
 
0.28
%
 
0.19
%
Repurchase agreements
0.15
%
 
0.06
%
 
0.02
%
 
0.02
%
 
0.04
%
Other borrowings
1.29
%
 
1.09
%
 
0.83
%
 
0.61
%
 
0.57
%
Subordinated debt
5.68
%
 
5.55
%
 
5.68
%
 
5.51
%
 
3.84
%
Total cost of interest-bearing liabilities
0.75
%
 
0.63
%
 
0.52
%
 
0.44
%
 
0.44
%
Tax-equivalent net interest revenue spread
2.75
%
 
2.67
%
 
2.63
%
 
2.54
%
 
2.49
%
Effect of noninterest-bearing funding sources and other
0.26
%
 
0.22
%
 
0.18
%
 
0.15
%
 
0.15
%
Tax-equivalent net interest margin
3.01
%
 
2.89
%
 
2.81
%
 
2.69
%
 
2.64
%

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

19



CREDIT QUALITY INDICATORS -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands, except ratios)
 
Three Months Ended
 
Sept. 30, 2017
 
June 30, 2017
 
Mar. 31, 2017
 
Dec. 31, 2016
 
Sept. 30, 2016
Nonperforming assets:
 
 
 
 
 
 
 
 
 
Nonaccruing loans:
 
 
 
 
 
 
 
 
 
Commercial
$
176,900

 
$
197,157

 
$
156,825

 
$
178,953

 
$
176,464

Commercial real estate
2,975

 
3,775

 
4,475

 
5,521

 
7,350

Residential mortgage
45,506

 
44,235

 
46,081

 
46,220

 
52,452

Personal
255

 
272

 
235

 
290

 
686

Total nonaccruing loans
225,636

 
245,439

 
207,616

 
230,984

 
236,952

Accruing renegotiated loans guaranteed by U.S. government agencies
69,440

 
80,624

 
83,577

 
81,370

 
80,306

Real estate and other repossessed assets
32,535

 
39,436

 
42,726

 
44,287

 
31,941

Total nonperforming assets
$
327,611

 
$
365,499

 
$
333,919

 
$
356,641

 
$
349,199

Total nonperforming assets excluding those guaranteed by U.S. government agencies
$
249,280

 
$
275,823

 
$
240,234

 
$
263,425

 
$
253,461

 
 
 
 
 
 
 
 
 
 
Nonaccruing loans by loan class:
 
 
 
 
 
 
 
 
 
Commercial:
 
 
 
 
 
 
 
 
 
Energy
$
110,683

 
$
123,992

 
$
110,425

 
$
132,499

 
$
142,966

Services
1,174

 
7,754

 
7,713

 
8,173

 
8,477

Wholesale / retail
1,893

 
10,620

 
11,090

 
11,407

 
2,453

Manufacturing
9,059

 
9,656

 
5,907

 
4,931

 
274

Healthcare
24,446

 
24,505

 
909

 
825

 
855

Other commercial and industrial
29,645

 
20,630

 
20,781

 
21,118

 
21,439

Total commercial
176,900

 
197,157

 
156,825

 
178,953

 
176,464

Commercial real estate:
 
 
 
 
 
 
 
 
 
Residential construction and land development
1,924

 
2,051

 
2,616

 
3,433

 
3,739

Retail
289

 
301

 
314

 
326

 
1,249

Office
275

 
396

 
413

 
426

 
882

Multifamily

 
10

 
24

 
38

 
51

Industrial

 

 
76

 
76

 
76

Other commercial real estate
487

 
1,017

 
1,032

 
1,222

 
1,353

Total commercial real estate
2,975

 
3,775

 
4,475

 
5,521

 
7,350

Residential mortgage:
 
 
 
 
 
 
 
 
 
Permanent mortgage
24,623

 
23,415

 
24,188

 
22,855

 
25,956

Permanent mortgage guaranteed by U.S. government agencies
8,891

 
9,052

 
10,108

 
11,846

 
15,432

Home equity
11,992

 
11,768

 
11,785

 
11,519

 
11,064

Total residential mortgage
45,506

 
44,235

 
46,081

 
46,220

 
52,452

Personal
255

 
272

 
235

 
290

 
686

Total nonaccruing loans
$
225,636

 
$
245,439

 
$
207,616

 
$
230,984

 
$
236,952

 
 
 
 
 
 
 
 
 
 

20



CREDIT QUALITY INDICATORS -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands, except ratios)
 
Three Months Ended
 
Sept. 30, 2017
 
June 30, 2017
 
Mar. 31, 2017
 
Dec. 31, 2016
 
Sept. 30, 2016
 
 
 
 
 
 
 
 
 
 
Performing loans 90 days past due1
$
253

 
$
1,414

 
$
95

 
$
5

 
$
3,839

 
 
 
 
 
 
 
 
 
 
Gross charge-offs
$
(5,825
)
 
$
(2,872
)
 
$
(2,153
)
 
$
(1,651
)
 
$
(8,101
)
Recoveries
2,437

 
1,214

 
2,900

 
2,813

 
2,038

Net recoveries (charge-offs)
$
(3,388
)
 
$
(1,658
)
 
$
747

 
$
1,162

 
$
(6,063
)
 
 
 
 
 
 
 
 
 
 
Provision for credit losses
$

 
$

 
$

 
$

 
$
10,000

 
 
 
 
 
 
 
 
 
 
Allowance for loan losses to period end loans
1.44
%
 
1.46
%
 
1.46
 %
 
1.45
 %
 
1.49
%
Combined allowance for credit losses to period end loans
1.47
%
 
1.49
%
 
1.52
 %
 
1.52
 %
 
1.56
%
Nonperforming assets to period end loans and repossessed assets
1.90
%
 
2.12
%
 
1.96
 %
 
2.09
 %
 
2.12
%
Net charge-offs (annualized) to average loans
0.08
%
 
0.04
%
 
(0.02
)%
 
(0.03
)%
 
0.15
%
Allowance for loan losses to nonaccruing loans1
114.28
%
 
105.78
%
 
125.92
 %
 
112.33
 %
 
110.65
%
Combined allowance for credit losses to nonaccruing loans1
116.78
%
 
108.51
%
 
130.70
 %
 
117.46
 %
 
115.67
%
1 
Excludes residential mortgage loans guaranteed by agencies of the U.S. government.


21
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