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BOK Financial Reports Record Quarterly Earnings of $114 million or $1.75 Per Share; Results Driven by Strong Loan Growth, Net Interest Margin Expansion, and Continued Expense Control; Quarterly Divide

July 25, 2018 7:56 AM

TULSA, Okla., July 25, 2018 (GLOBE NEWSWIRE) -- BOK Financial Corporation (NASDAQ: BOKF) reported net income of $114.4 million or $1.75 per diluted share for the second quarter of 2018. Net income was $105.6 million or $1.61 per diluted share for the first quarter of 2018 and $88.1 million or $1.35 per diluted share for the second quarter of 2017.

Steven G. Bradshaw, president and chief executive officer, stated, “This was a record quarter for BOK Financial, with the highest level of pre–tax, pre–provision income in our company’s history. In addition, we saw sustainable momentum across all of our lending businesses, with a record $665 million of new loan production in the quarter and 3.8 percent sequential growth in period end loans outstanding. With continued loan growth and net interest margin expansion, a stable credit environment, and ongoing expense management as we move toward our 60 percent efficiency ratio goal, we see earnings leverage continuing for the foreseeable future. Accordingly, our Board of Directors approved an 11 percent increase in our regular quarterly dividend to 50 cents per share.”

Bradshaw continued, “We look forward to closing our acquisition of CoBiz Financial later this year, which we believe will further enhance our growth profile. We believe the combination of CoBiz and BOK Financial will create the premier commercial bank in Colorado and Arizona. In addition, the financial metrics of the deal are highly compelling, as we expect it to be accretive to earnings per share, return on average assets, return on tangible common equity, net interest margin, and efficiency ratio.”

Second Quarter 2018 Highlights

Net Interest Revenue

Net interest revenue was $238.6 million for the second quarter of 2018, an $18.8 million increase over the first quarter of 2018.

Net interest margin was 3.17 percent for the second quarter of 2018, an increase of 18 basis points over the first quarter of 2018. Recoveries of foregone interest on nonaccruing loans added $5.3 million or 7 basis points to net interest margin in the second quarter. Excluding the impact of interest recoveries in the second quarter, the yield on average earning assets was 3.84 percent, a 23 basis point increase over the prior quarter. The loan portfolio yield also increased 23 basis points to 4.68 percent. The yield on the available for sale securities portfolio increased 7 basis points to 2.30 percent. The yield on interest-bearing cash and cash equivalents increased 29 basis points. Funding costs were 1.11 percent, up 18 basis points. The cost of interest-bearing deposits increased 9 basis points to 0.66 percent. The cost of other borrowed funds was up 34 basis points to 1.84 percent. The benefit to net interest margin from assets funded by non-interest liabilities increased to 37 basis points from 31 basis points in the first quarter of 2018.

Average earning assets increased $423 million over the second quarter of 2018. Trading securities balances increased $549 million. Average loan balances grew by $490 million. Average interest-bearing cash and cash equivalents balances decreased $386 million. Average fair value option securities held as an economic hedge of our mortgage servicing rights decreased $139 million. Average available for sale securities decreased $74 million. Average interest-bearing deposit balances decreased $144 million compared to the first quarter of 2018. The average balance of borrowed funds increased $231 million.

Fees and Commissions Revenue

Fees and commissions revenue totaled $157.9 million for the second quarter of 2018, consistent with the results from the first quarter of 2018.

Brokerage and trading revenue decreased $4.2 million compared to the first quarter of 2018. Rising mortgage interest rates narrowed trading margins and slowed turnover of our trading inventory. However, the longer average hold time of trading securities increased net interest revenue by $3.1 million.

Other revenue increased $2.2 million compared to the first quarter of 2018 primarily due to appreciation in assets related to the deferred compensation plan. This is primarily offset by an increase in deferred compensation expense. Mortgage banking revenue was relatively consistent with the previous quarter. A 2 percent decrease in mortgage production volume was offset by an increase in the gain on sale margin.

Operating Expense

Total operating expense was $246.5 million for the second quarter of 2018, largely unchanged compared to the first quarter of 2018.

Personnel expense decreased $1.0 million. Incentive compensation expense decreased $1.0 million. Changes in assumptions for performance-based awards decreased equity compensation expense by $4.3 million. This was partially offset by an increase of $2.4 million in cash based incentive compensation. Employee benefits expense decreased $1.2 million primarily due to a seasonal decrease in payroll taxes partially offset by an overall increase in employee healthcare costs. Regular compensation increased $1.2 million as merit increases were effective for most employees in March 2018.

Non-personnel expense increased $3.0 million. Professional fees and services expense increased $4.8 million mainly due to $1.8 million in project costs, $1.0 million in costs related to the pending CoBiz acquisition and $953 thousand in seasonal tax preparation charges from trust operations. Mortgage banking costs increased $2.7 million primarily due to a $1.9 million increase in accruals related to default servicing and loss mitigation costs on loans serviced for others.

Net losses and operating expenses of repossessed assets decreased $5.0 million, primarily due to a $5.0 million write-down on a set of repossessed oil and gas properties in the first quarter of 2018.

Loans, Deposits and Capital

Loans

Outstanding loans were $18.0 billion at June 30, 2018, up more than $665 million or 3.8 percent over March 31, 2018. Loan growth can generally be attributed to tax reform changes and regulatory easing resulting in a better overall business environment. Specifically, growth in energy loans is consistent with our ongoing support and commitment to the oil and gas industry.

Outstanding commercial loan balances grew by $429 million or 3.9 percent over March 31, 2018. Energy loan balances were up $178 million. Unfunded energy loan commitments increased $80 million over March 31, 2018 to $3.0 billion at June 30, 2018. Wholesale/retail sector loan balances grew by $168 million. Manufacturing sector loan balances were up $88 million. Service sector loans increased $16 million, mostly offset by a $14 million decrease in other commercial and industrial loans.

Commercial real estate loan balances grew by $205 million or 5.9 percent over March 31, 2018. Loans secured by office buildings increased $83 million. Multifamily residential loan balances were up $48 million. Loans secured by industrial properties grew by $40 million. Loans secured by retail facilities and other commercial real estate loans increased $18 million and $15 million, respectively.

Deposits

Period-end deposits totaled $22.2 billion at June 30, 2018, a $36 million decrease compared to March 31, 2018. Interest-bearing transaction account balances decreased $63 million and time deposit balances decreased by $39 million. These decreases were partially offset by a $68 million increase in demand deposit balances. Consumer Banking deposits were down $71 million and Commercial Banking deposits decreased $41 million, partially offset by a $7.3 million increase in Wealth Management deposits.

Capital

The company's common equity Tier 1 capital ratio was 11.92 percent at June 30, 2018. In addition, the company's Tier 1 capital ratio was 11.92 percent, total capital ratio was 13.26 percent, and leverage ratio was 9.57 percent at June 30, 2018. At March 31, 2018, the company's common equity Tier 1 capital ratio was 12.06 percent, Tier 1 capital ratio was 12.06 percent, total capital ratio was 13.49 percent, and leverage ratio was 9.40 percent.

The decrease in regulatory capital ratios was due in part to introduction of the market risk capital rules. The company exceeded the $1 billion regulatory capital rules threshold for trading assets and liabilities at March 31. This subjects the company to the market risk rule, which imposed additional modeling, systems, oversight and reporting requirements beginning in the second quarter of 2018 and resulted in an increase in risk weighted assets associated with our trading activities.

The company's tangible common equity ratio, a non-GAAP measure, was 9.21 percent at June 30, 2018 and 9.18 percent at March 31, 2018. The tangible common equity ratio is primarily based on total shareholders' equity, which includes unrealized gains and losses on available for sale securities. The company has elected to exclude unrealized gains and losses from available for sale securities from its calculation of Tier 1 capital for regulatory capital purposes, consistent with the treatment under the previous capital rules.

Credit Quality

Nonperforming assets totaled $269 million or 1.49 percent of outstanding loans and repossessed assets at June 30, 2018, down from $278 million or 1.60 percent at March 31, 2018. Nonperforming assets that are not guaranteed by U.S. government agencies totaled $186 million or 1.04 percent of outstanding loans and repossessed assets (excluding those guaranteed by U.S. government agencies) at June 30, 2018, compared to $195 million or 1.13 percent at March 31, 2018.

Nonaccruing loans were $166 million or 0.92 percent of outstanding loans at June 30, 2018, compared to $180 million or 1.04 percent of outstanding loans at March 31, 2018. The decrease in nonaccruing loans was primarily due to a $24 million decrease in energy loans, partially offset by a $12 million increase in wholesale/retail sector loans. New nonaccruing loans identified in the second quarter totaled $42 million, offset by $31 million in payments received, $15 million in charge-offs and $8.2 million in foreclosures and repossessions. At June 30, 2018, nonaccruing commercial loans totaled $121 million or 1.07 percent of outstanding commercial loans, nonaccruing commercial real estate loans totaled $2.0 million or 0.05 percent of outstanding commercial real estate loans and nonaccruing residential mortgage loans totaled $42 million or 2.18 percent of outstanding residential mortgage 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 $140 million at June 30, down from $222 million at March 31. The decrease largely resulted from energy, services, and wholesale/retail sector loans.

The company had net charge-offs of $10.5 million or 0.24 percent of average loans on an annualized basis for second quarter of 2018, compared to net charge-offs of $1.3 million or 0.03 percent of average loans on an annualized basis for the first quarter of 2018. Net charge-offs were 0.16 percent of average loans over the last four quarters. Over half of the second quarter net charge-offs was from one energy loan that had previously been identified as impaired and appropriately reserved. Gross charge-offs were $15.1 million for the second quarter compared to $2.9 million for the previous quarter. Recoveries totaled $4.6 million for the second quarter of 2018 and $1.6 million for the first quarter of 2018.

Based on an evaluation of all credit factors, including overall loan portfolio growth, changes in nonaccruing and potential problem loans and net charge-offs, the company determined that no provision for credit losses was appropriate for the second quarter of 2018. The company had a $5.0 million negative provision for credit losses in the first quarter of 2018.

The combined allowance for credit losses totaled $218 million or 1.21 percent of outstanding loans and 138 percent of nonaccruing loans at June 30, 2018, excluding residential mortgage loans guaranteed by U.S. government agencies. The allowance for loan losses was $215 million and the accrual for off-balance sheet credit losses was $2.4 million. At March 31, 2018, the combined allowance for credit losses was $228 million or 1.32 percent of outstanding loans and 133 percent of nonaccruing loans, excluding loans guaranteed by U.S. government agencies. The allowance for loan losses was $224 million and the accrual for off-balance sheet credit losses was $4.1 million.

Securities and Derivatives

The fair value of the available for sale securities portfolio totaled $8.2 billion at June 30, 2018, an $87 million decrease compared to March 31, 2018. At June 30, 2018, the available for sale portfolio consisted primarily of $5.3 billion of residential mortgage-backed securities fully backed by U.S. government agencies and $2.7 billion of commercial mortgage-backed securities fully backed by U.S. government agencies. At June 30, 2018, the available for sale securities portfolio had a net unrealized loss of $181 million compared to a $148 million net unrealized loss at March 31, 2018.

Trading securities increased $617 million to $1.9 billion during the second quarter of 2018 as a result of expanded relationships with mortgage loan originator clients along with slower inventory turnover rates. The company holds an inventory of trading securities in support of sales to a variety of customers, including banks, corporations, insurance companies, money managers, and others.

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

The net economic cost of the changes in fair value of mortgage servicing rights and related economic hedges was $3.5 million during the second quarter of 2018, including a $1.7 million increase in the fair value of mortgage servicing rights, a $6.4 million decrease in the fair value of securities and derivative contracts held as an economic hedge, and $1.2 million of related net interest revenue.

The fair value of mortgage servicing rights increased by $21.2 million during the first quarter of 2018. The fair value of securities and interest rate derivative contracts held as an economic hedge of mortgage servicing rights decreased by $23.3 million. Related net interest revenue was $1.8 million during the first quarter of 2018.

Conference Call and Webcast

The company will hold a conference call at 9 a.m. Central time on Wednesday, July 25, 2018 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 # 13681367.

About BOK Financial Corporation

BOK Financial Corporation is a $34 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 June 30, 2018 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 within the meaning of the Private Securities Litigation Reform Act of 1995 including, but not limited to, CoBiz Financial Inc.’s and BOK Financial Corporation’s expectations or predictions of future financial or business performance or conditions. Forward-looking statements are typically identified by words such as “believe,” “expect,” “anticipate,” “intend,” “target,” “estimate,” “continue,” “positions,” “plan,” “predict,” “project,” “forecast,” “guidance,” “goal,” “objective,” “prospects,” “possible” or “potential,” by future conditional verbs such as “assume,” “will,” “would,” “should,” “could” or “may”, or by variations of such words or by similar expressions. These forward-looking statements are subject to numerous assumptions, risks and uncertainties, which change over time. Forward-looking statements speak only as of the date they are made and we assume no duty to update forward-looking statements. Actual results may differ materially from current projections.

In addition to factors previously disclosed in CoBiz Financial Inc.’s and BOK Financial Corporation’s reports filed with the SEC and those identified elsewhere in this communication, the following factors, among others, could cause actual results to differ materially from forward-looking statements or historical performance: the ability to obtain regulatory approvals and meet other closing conditions to the merger, including approval by CoBiz Financial Inc.’s shareholders on the expected terms and schedule, including the risk that regulatory approvals required for the merger are not obtained or are obtained subject to conditions that are not anticipated; delay in closing the merger; difficulties and delays in integrating CoBiz Financial Inc.’s business or fully realizing cost savings and other benefits; business disruption following the merger; changes in asset quality and credit risk; the inability to sustain revenue and earnings growth; changes in interest rates and capital markets; inflation; customer acceptance of BOK Financial Corporation’s products and services; customer borrowing, repayment, investment and deposit practices; customer disintermediation; the introduction, withdrawal, success and timing of business initiatives; competitive conditions; the inability to realize cost savings or revenues or to implement integration plans and other consequences associated with mergers, acquisitions and divestitures; economic conditions; and the impact, extent and timing of technological changes, capital management activities, and other actions of the Federal Reserve Board and legislative and regulatory actions and reforms.

Annualized, pro forma, projected and estimated numbers are used for illustrative purpose only, are not forecasts and may not reflect actual results.

In this news release we may sometimes use non-GAAP Financial information. Please note that although non-GAAP financial measures provide useful insight to analysts, investors and regulators, they should not be considered in isolation or relied upon as a substitute for analysis using GAAP measures. If applicable, we provide GAAP reconciliations for non-GAAP financial measures.

IMPORTANT ADDITIONAL INFORMATION AND WHERE TO FIND IT

In connection with the proposed merger, BOK Financial Corporation has filed with the SEC a Registration Statement on Form S-4 that will include the Proxy Statement of CoBiz Financial Inc. and a Prospectus of BOK Financial Corporation, as well as other relevant documents concerning the proposed transaction. This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval. INVESTORS AND SHAREHOLDERS ARE URGED TO READ THE REGISTRATION STATEMENT AND THE PROXY STATEMENT/PROSPECTUS REGARDING THE MERGER E AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THOSE DOCUMENTS, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION.

A free copy of the Proxy Statement/Prospectus, as well as other filings containing information about BOK Financial Corporation and CoBiz Financial Inc., may be obtained at the SEC’s Internet site (http://www.sec.gov). You will also be able to obtain these documents, free of charge, from CoBiz Financial Inc. at ir.cobizfinancial.com or from BOK Financial Corporation by accessing BOK Financial Corporation’s website at www.bokf.com. Copies of the Proxy Statement/Prospectus can also be obtained, free of charge, by directing a request to CoBiz Financial Inc. Investor Relations at CoBiz Financial Inc. Investor Relations, 1401 Lawrence Street, Suite 1200, Denver, CO, by calling (303) 312-3412, or by sending an e-mail to [email protected] or to BOK Financial Corporation Investor Relations at Bank of Oklahoma Tower, Boston Avenue at Second Street, Tulsa, Oklahoma, by calling (918) 588-6000 or by sending an e-mail to [email protected].

CoBiz Financial Inc. and BOK Financial Corporation and certain of their respective directors and executive officers may be deemed to be participants in the solicitation of proxies from the shareholders of CoBiz Financial Inc. in respect of the transaction described in the Proxy Statement/Prospectus. Information regarding CoBiz Financial Inc.’s directors and executive officers is contained in CoBiz Financial Inc.’s Annual Report on Form 10-K for the year ended December 31, 2017 and its Proxy Statement on Schedule 14A, dated March 9, 2018, which are filed with the SEC. Information regarding BOK Financial Corporation’s directors and executive officers is contained in BOK Financial Corporation’s Annual Report on Form 10-K for the year ended December 31, 2017 and its Proxy Statement on Schedule 14A, dated March 15, 2018, which are filed with the SEC. Additional information regarding the interests of those participants and other persons who may be deemed participants in the transaction may be obtained by reading the Proxy Statement/Prospectus regarding the proposed merger when it becomes available. Free copies of this document may be obtained as described in the preceding paragraph.

BALANCE SHEETS -- UNAUDITEDBOK FINANCIAL CORPORATION(In thousands)
June 30, 2018 Mar. 31, 2018 June 30, 2017
ASSETS
Cash and due from banks$585,801 $544,534 $561,587
Interest-bearing cash and cash equivalents872,999 2,054,899 2,078,831
Trading securities1,909,615 1,292,432 441,414
Investment securities392,013 416,672 490,426
Available for sale debt securities8,162,866 8,249,432 8,341,041
Fair value option securities482,227 513,668 445,169
Restricted equity securities347,721 338,552 311,033
Residential mortgage loans held for sale223,301 225,190 287,259
Loans:
Commercial11,349,039 10,919,667 10,637,955
Commercial real estate3,712,220 3,506,782 3,688,592
Residential mortgage1,942,250 1,945,769 1,939,198
Personal1,000,187 965,632 917,900
Total loans18,003,696 17,337,850 17,183,645
Allowance for loan losses(215,142) (223,967) (250,061)
Loans, net of allowance17,788,554 17,113,883 16,933,584
Premises and equipment, net320,810 314,347 321,038
Receivables212,893 206,577 170,094
Goodwill453,093 447,430 446,697
Intangible assets, net28,273 29,658 40,755
Mortgage servicing rights278,719 274,978 245,239
Real estate and other repossessed assets, net27,891 23,652 39,436
Derivative contracts, net373,373 286,687 280,289
Cash surrender value of bank-owned life insurance321,024 318,661 312,774
Receivable on unsettled securities sales604,552 275,088 158,125
Other assets447,382 435,152 358,741
TOTAL ASSETS$33,833,107 $33,361,492 $32,263,532
LIABILITIES AND EQUITY
Deposits:
Demand$9,373,959 $9,306,023 $9,568,895
Interest-bearing transaction10,164,099 10,226,971 10,087,139
Savings503,474 505,952 464,318
Time2,127,732 2,166,254 2,196,122
Total deposits22,169,264 22,205,200 22,316,474
Funds purchased and repurchase agreements880,027 546,324 464,323
Other borrowings5,929,445 5,727,025 5,232,343
Subordinated debentures144,697 144,687 144,658
Accrued interest, taxes and expense160,568 156,146 133,198
Due on unsettled securities purchases571,034 553,840 31,214
Derivative contracts, net234,856 233,202 285,819
Other liabilities167,171 277,726 205,958
TOTAL LIABILITIES30,257,062 29,844,150 28,813,987
Shareholders' equity:
Capital, surplus and retained earnings3,688,736 3,606,220 3,414,505
Accumulated other comprehensive gain (loss)(135,305) (111,191) 7,964
TOTAL SHAREHOLDERS' EQUITY3,553,431 3,495,029 3,422,469
Non-controlling interests22,614 22,313 27,076
TOTAL EQUITY3,576,045 3,517,342 3,449,545
TOTAL LIABILITIES AND EQUITY$33,833,107 $33,361,492 $32,263,532

AVERAGE BALANCE SHEETS -- UNAUDITEDBOK FINANCIAL CORPORATION(in thousands)
Three Months Ended
June 30, 2018 Mar. 31, 2018 Dec. 31, 2017 Sept. 30, 2017 June 30, 2017
ASSETS
Interest-bearing cash and cash equivalents$1,673,387 $2,059,517 $1,976,395 $1,965,645 $2,007,746
Trading securities1,482,302 933,404 560,321 491,613 456,028
Investment securities399,088 441,207 462,869 475,705 499,372
Available for sale debt securities8,163,142 8,236,938 8,435,916 8,428,353 8,384,057
Fair value option securities487,192 626,251 792,647 684,571 476,102
Restricted equity securities348,546 349,176 337,673 328,677 295,743
Residential mortgage loans held for sale218,600 199,380 257,927 256,343 245,401
Loans:
Commercial11,189,899 10,871,569 10,751,235 10,827,198 10,604,456
Commercial real estate3,660,166 3,491,335 3,485,583 3,528,330 3,676,976
Residential mortgage1,915,015 1,937,198 1,976,860 1,951,385 1,933,091
Personal986,162 961,379 967,329 949,750 915,010
Total loans17,751,242 17,261,481 17,181,007 17,256,663 17,129,533
Allowance for loan losses(222,856) (228,996) (246,143) (250,590) (251,632)
Total loans, net17,528,386 17,032,485 16,934,864 17,006,073 16,877,901
Total earning assets30,300,643 29,878,358 29,758,612 29,636,980 29,242,350
Cash and due from banks571,333 564,585 576,737 546,653 530,352
Derivative contracts, net318,375 278,694 292,961 238,583 248,168
Cash surrender value of bank-owned life insurance319,507 317,334 315,034 313,079 311,310
Receivable on unsettled securities sales618,240 998,803 821,275 608,412 372,894
Other assets1,777,937 1,687,178 1,687,496 1,664,463 1,663,497
TOTAL ASSETS$33,906,035 $33,724,952 $33,452,115 $33,008,170 $32,368,571
LIABILITIES AND EQUITY
Deposits:
Demand$9,223,327 $9,151,272 $9,417,351 $9,389,849 $9,338,683
Interest-bearing transaction10,189,354 10,344,469 10,142,744 10,088,522 10,087,640
Savings503,671 480,110 466,496 464,130 461,586
Time2,138,880 2,151,044 2,134,469 2,176,820 2,204,422
Total deposits22,055,232 22,126,895 22,161,060 22,119,321 22,092,331
Funds purchased and repurchase agreements593,250 532,412 488,330 411,286 490,616
Other borrowings6,497,020 6,326,967 6,209,903 6,162,641 5,572,031
Subordinated debentures144,692 144,682 144,673 144,663 144,654
Derivative contracts, net235,543 223,373 288,408 221,371 178,695
Due on unsettled securities purchases527,804 558,898 332,155 145,977 162,348
Other liabilities340,322 333,151 312,196 318,270 318,463
TOTAL LIABILITIES30,393,863 30,246,378 29,936,725 29,523,529 28,959,138
Total equity3,512,172 3,478,574 3,515,390 3,484,641 3,409,433
TOTAL LIABILITIES AND EQUITY$33,906,035 $33,724,952 $33,452,115 $33,008,170 $32,368,571

STATEMENTS OF EARNINGS -- UNAUDITEDBOK FINANCIAL CORPORATION(in thousands, except per share data)
Three Months Ended Six Months Ended
June 30, June 30,
2018 2017 2018 2017
Interest revenue$294,180 $235,181 $559,587 $461,571
Interest expense55,618 29,977 101,289 55,185
Net interest revenue238,562 205,204 458,298 406,386
Provision for credit losses— — (5,000) —
Net interest revenue after provision for credit losses238,562 205,204 463,298 406,386
Other operating revenue:
Brokerage and trading revenue26,488 31,764 57,136 65,387
Transaction card revenue120,975 20,009 41,965 38,186
Fiduciary and asset management revenue41,699 41,808 83,531 80,439
Deposit service charges and fees27,827 28,422 54,988 56,199
Mortgage banking revenue26,346 30,276 52,371 55,467
Other revenue14,518 14,984 26,848 26,736
Total fees and commissions157,853 167,263 316,839 322,414
Other gains, net3,983 6,108 3,319 9,735
Gain (loss) on derivatives, net(3,057) 3,241 (8,742) 2,791
Gain (loss) on fair value option securities, net(3,341) 1,984 (20,905) 844
Change in fair value of mortgage servicing rights1,723 (6,943) 22,929 (5,087)
Gain (loss) on available for sale securities, net(762) 380 (1,052) 2,429
Total other operating revenue156,399 172,033 312,388 333,126
Other operating expense:
Personnel138,947 143,744 278,894 280,169
Business promotion7,686 7,738 13,696 14,455
Professional fees and services14,978 12,419 25,178 23,836
Net occupancy and equipment22,761 21,125 46,807 42,749
Insurance6,245 689 12,838 7,093
Data processing and communications127,739 26,111 55,556 51,810
Printing, postage and supplies4,011 4,140 8,100 7,991
Net losses and operating expenses of repossessed assets2,722 2,267 10,427 3,276
Amortization of intangible assets1,386 1,803 2,686 3,605
Mortgage banking costs12,890 12,072 23,039 25,075
Other expense7,111 8,558 13,685 16,115
Total other operating expense246,476 240,666 490,906 476,174
Net income before taxes148,485 136,571 284,780 263,338
Federal and state income taxes33,330 47,705 64,278 85,808
Net income115,155 88,866 220,502 177,530
Net income attributable to non-controlling interests783 719 568 1,027
Net income attributable to BOK Financial Corporation shareholders$114,372 $88,147 $219,934 $176,503
Average shares outstanding:
Basic64,901,975 64,729,752 64,874,567 64,722,744
Diluted64,937,226 64,793,134 64,912,552 64,788,322
Net income per share:
Basic$1.75 $1.35 $3.36 $2.70
Diluted$1.75 $1.35 $3.36 $2.69

1 Non-GAAP measure to net interchange charges for periods prior to 2018 between transaction card revenue and data processing and communications expense. This measure has no effect on net income or earnings per share.

FINANCIAL HIGHLIGHTS -- UNAUDITEDBOK FINANCIAL CORPORATION(in thousands, except ratio and share data)
Three Months Ended
June 30, 2018 Mar. 31, 2018 Dec. 31, 2017 Sept. 30, 2017 June 30, 2017
Capital:
Period-end shareholders' equity$3,553,431 $3,495,029 $3,495,367 $3,488,814 $3,422,469
Risk weighted assets$27,004,559 $26,025,660 $25,733,711 $25,409,728 $25,130,802
Risk-based capital ratios:
Common equity tier 111.92% 12.06% 12.05% 11.90% 11.76%
Tier 111.92% 12.06% 12.05% 11.90% 11.76%
Total capital13.26% 13.49% 13.54% 13.47% 13.36%
Leverage ratio9.57% 9.40% 9.31% 9.30% 9.27%
Tangible common equity ratio19.21% 9.18% 9.50% 9.23% 9.24%
Common stock:
Book value per share$54.30 $53.39 $53.45 $53.30 $52.32
Tangible book value per share46.95 46.10 46.17 45.88 44.87
Market value per share:
High$106.65 $107.00 $93.97 $90.69 $88.31
Low$92.39 $89.82 $79.67 $77.10 $74.09
Cash dividends paid$29,340 $29,342 $29,328 $28,655 $28,652
Dividend payout ratio25.65% 27.80% 40.46% 33.46% 32.50%
Shares outstanding, net65,439,090 65,459,505 65,394,937 65,456,786 65,416,403
Stock buy-back program:
Shares repurchased8,257 82,583 80,000 — —
Amount$824 $7,584 $7,403 $— $—
Average price per share$99.84 $91.83 $92.54 $— $—
Performance ratios (quarter annualized):
Return on average assets1.35% 1.27% 0.86% 1.03% 1.09%
Return on average equity13.14% 12.39% 8.24% 9.83% 10.46%
Net interest margin3.17% 2.99% 2.97% 3.01% 2.89%
Efficiency ratio361.68% 65.09% 66.07% 65.92% 63.66%
Reconciliation of non-GAAP measures:
1 Tangible common equity ratio:
Total shareholders' equity$3,553,431 $3,495,029 $3,495,367 $3,488,814 $3,422,469
Less: Goodwill and intangible assets, net481,366 477,088 476,088 485,710 487,452
Tangible common equity$3,072,065 $3,017,941 $3,019,279 $3,003,104 $2,935,017
Total assets$33,833,107 $33,361,492 $32,272,160 $33,005,515 $32,263,532
Less: Goodwill and intangible assets, net481,366 477,088 476,088 485,710 487,452
Tangible assets$33,351,741 $32,884,404 $31,796,072 $32,519,805 $31,776,080
Tangible common equity ratio9.21% 9.18% 9.50% 9.23% 9.24%
Other data:
Fiduciary assets$46,531,900 $46,648,290 $48,761,477 $45,177,185 $45,089,153
Tax equivalent interest$1,983 $2,010 $4,131 $4,314 $4,330
Net unrealized gain (loss) on available for sale securities$(180,602) $(148,247) $(47,497) $14,061 $16,041
Mortgage banking:
Mortgage production revenue$9,915 $9,452 $7,786 $8,329 $13,840
Mortgage loans funded for sale$773,910 $664,958 $840,080 $832,796 $902,978
Add: current period-end outstanding commitments251,231 298,318 222,919 334,337 362,088
Less: prior period end outstanding commitments298,318 222,919 334,337 362,088 381,732
Total mortgage production volume$726,823 $740,357 $728,662 $805,045 $883,334
Mortgage loan refinances to mortgage loans funded for sale22% 42% 47% 38% 33%
Gain on sale margin1.36% 1.28% 1.07% 1.03% 1.57%
Mortgage servicing revenue$16,431 $16,573 $16,576 $16,561 $16,436
Average outstanding principal balance of mortgage loans serviced for others21,986,065 22,027,726 22,054,877 22,079,177 22,055,127
Average mortgage servicing revenue rates0.30% 0.31% 0.30% 0.30% 0.30%
Gain (loss) on mortgage servicing rights, net of economic hedge:
Gain (loss) on mortgage hedge derivative contracts, net$(3,070) $(5,698) $(3,057) $1,025 $3,241
Gain (loss) on fair value option securities, net(3,341) (17,564) (4,238) 661 1,984
Gain (loss) on economic hedge of mortgage servicing rights(6,411) (23,262) (7,295) 1,686 5,225
Gain (loss) on changes in fair value of mortgage servicing rights1,723 21,206 5,898 (639) (6,943)
Gain (loss) on changes in fair value of mortgage servicing rights, net of economic hedges, included in other operating revenue(4,688) (2,056) (1,397) 1,047 (1,718)
Net interest revenue on fair value option securities21,203 1,800 2,656 2,543 1,965
Total economic benefit (cost) of changes in the fair value of mortgage servicing rights, net of economic hedges$(3,485) $(256) $1,259 $3,590 $247

2 Actual interest earned on fair value option securities less internal transfer-priced cost of funds.3 Periods prior to 2018 are shown on a comparable basis to net interchange charges between transaction card revenue and data processing and communications expense.

QUARTERLY EARNINGS TREND -- UNAUDITEDBOK FINANCIAL CORPORATION(in thousands, except ratio and per share data)
Three Months Ended
June 30, 2018 Mar. 31, 2018 Dec. 31, 2017 Sept. 30, 2017 June 30, 2017
Interest revenue$294,180 $265,407 $255,767 $255,413 $235,181
Interest expense55,618 45,671 38,904 36,961 29,977
Net interest revenue238,562 219,736 216,863 218,452 205,204
Provision for credit losses— (5,000) (7,000) — —
Net interest revenue after provision for credit losses238,562 224,736 223,863 218,452 205,204
Other operating revenue:
Brokerage and trading revenue26,488 30,648 33,045 33,169 31,764
Transaction card revenue120,975 20,990 20,028 22,929 20,009
Fiduciary and asset management revenue41,699 41,832 41,767 40,687 41,808
Deposit service charges and fees27,827 27,161 27,685 28,191 28,422
Mortgage banking revenue26,346 26,025 24,362 24,890 30,276
Other revenue14,518 12,330 11,762 13,670 14,984
Total fees and commissions157,853 158,986 158,649 163,536 167,263
Other gains (losses), net3,983 (664) 552 (1,283) 6,108
Gain (loss) on derivatives, net(3,057) (5,685) (3,045) 1,033 3,241
Gain (loss) on fair value option securities, net(3,341) (17,564) (4,238) 661 1,984
Change in fair value of mortgage servicing rights1,723 21,206 5,898 (639) (6,943)
Gain (loss) on available for sale securities, net(762) (290) (488) 2,487 380
Total other operating revenue156,399 155,989 157,328 165,795 172,033
Other operating expense:
Personnel138,947 139,947 145,329 147,910 143,744
Business promotion7,686 6,010 7,317 7,105 7,738
Charitable contributions to BOKF Foundation— — 2,000 — —
Professional fees and services14,978 10,200 15,344 11,887 12,419
Net occupancy and equipment22,761 24,046 22,403 21,325 21,125
Insurance6,245 6,593 6,555 6,005 689
Data processing and communications127,739 27,817 28,903 27,412 26,111
Printing, postage and supplies4,011 4,089 3,781 3,917 4,140
Net losses (gains) and operating expenses of repossessed assets2,722 7,705 340 6,071 2,267
Amortization of intangible assets1,386 1,300 1,430 1,744 1,803
Mortgage banking costs12,890 10,149 14,331 13,450 12,072
Other expense7,111 6,574 6,746 9,193 8,558
Total other operating expense246,476 244,430 254,479 256,019 240,666
Net income before taxes148,485 136,295 126,712 128,228 136,571
Federal and state income taxes33,330 30,948 54,347 42,438 47,705
Net income115,155 105,347 72,365 85,790 88,866
Net income (loss) attributable to non-controlling interests783 (215) (127) 141 719
Net income attributable to BOK Financial Corporation shareholders$114,372 $105,562 $72,492 $85,649 $88,147
Average shares outstanding:
Basic64,901,975 64,847,334 64,793,005 64,742,822 64,729,752
Diluted64,937,226 64,888,033 64,843,179 64,805,172 64,793,134
Net income per share:
Basic$1.75 $1.61 $1.11 $1.31 $1.35
Diluted$1.75 $1.61 $1.11 $1.31 $1.35

1 Non-GAAP measure to net interchange charges for periods prior to 2018 between transaction card revenue and data processing and communications expense. This measure has no effect on net income or earnings per share.

LOANS TREND -- UNAUDITEDBOK FINANCIAL CORPORATION(In thousands)
June 30, 2018 Mar. 31, 2018 Dec. 31, 2017 Sept. 30, 2017 June 30, 2017
Commercial:
Energy $3,147,219 $2,969,618 $2,930,156 $2,867,981 $2,847,240
Services 2,944,499 2,928,294 2,986,949 2,967,513 2,958,827
Healthcare 2,353,722 2,359,928 2,314,753 2,239,451 2,221,518
Wholesale/retail 1,699,554 1,531,576 1,471,256 1,658,098 1,543,695
Manufacturing 647,816 559,695 496,774 519,446 546,137
Other commercial and industrial 556,229 570,556 534,087 543,445 520,538
Total commercial 11,349,039 10,919,667 10,733,975 10,795,934 10,637,955
Commercial real estate:
Multifamily 1,056,984 1,008,903 980,017 999,009 952,380
Office 820,127 737,144 831,770 797,089 862,973
Retail 768,024 750,396 691,532 725,865 722,805
Industrial 653,384 613,608 573,014 591,080 693,635
Residential construction and land development 118,999 117,458 117,245 112,102 141,592
Other commercial real estate 294,702 279,273 286,409 292,997 315,207
Total commercial real estate 3,712,220 3,506,782 3,479,987 3,518,142 3,688,592
Residential mortgage:
Permanent mortgage 1,068,412 1,047,785 1,043,435 1,013,965 989,040
Permanent mortgages guaranteed by U.S. government agencies 169,653 177,880 197,506 187,370 191,729
Home equity 704,185 720,104 732,745 744,415 758,429
Total residential mortgage 1,942,250 1,945,769 1,973,686 1,945,750 1,939,198
Personal 1,000,187 965,632 965,776 947,008 917,900
Total $18,003,696 $17,337,850 $17,153,424 $17,206,834 $17,183,645

LOANS BY PRINCIPAL MARKET AREA -- UNAUDITEDBOK FINANCIAL CORPORATION(in thousands)
June 30, 2018 Mar. 31, 2018 Dec. 31, 2017 Sept. 30, 2017 June 30, 2017
Bank of Oklahoma:
Commercial$3,465,407 $3,265,013 $3,238,720 $3,408,973 $3,369,967
Commercial real estate662,665 668,031 682,037 712,915 667,932
Residential mortgage1,403,658 1,419,281 1,435,432 1,405,900 1,398,021
Personal362,846 353,128 342,212 322,320 318,016
Total Bank of Oklahoma5,894,576 5,705,453 5,698,401 5,850,108 5,753,936
Bank of Texas:
Commercial4,922,451 4,715,841 4,520,401 4,434,595 4,339,634
Commercial real estate1,336,101 1,254,421 1,261,864 1,236,702 1,360,164
Residential mortgage243,400 229,761 233,675 229,993 232,074
Personal394,021 363,608 375,084 375,173 354,222
Total Bank of Texas6,895,973 6,563,631 6,391,024 6,276,463 6,286,094
Bank of Albuquerque:
Commercial305,167 315,701 343,296 367,747 369,370
Commercial real estate386,878 348,485 341,282 319,208 324,405
Residential mortgage90,581 93,490 98,018 101,983 103,849
Personal11,107 11,667 11,721 12,953 12,439
Total Bank of Albuquerque793,733 769,343 794,317 801,891 810,063
Bank of Arkansas:
Commercial93,217 94,430 95,644 91,051 85,020
Commercial real estate90,807 88,700 87,393 80,917 73,943
Residential mortgage6,927 7,033 6,596 6,318 6,395
Personal12,331 9,916 9,992 10,388 11,993
Total Bank of Arkansas203,282 200,079 199,625 188,674 177,351
Colorado State Bank & Trust:
Commercial1,165,721 1,180,655 1,130,714 1,124,200 1,065,780
Commercial real estate267,065 210,801 174,201 186,427 255,379
Residential mortgage64,839 64,530 63,350 63,734 63,346
Personal60,504 63,118 63,115 60,513 56,187
Total Colorado State Bank & Trust1,558,129 1,519,104 1,431,380 1,434,874 1,440,692
Bank of Arizona:
Commercial681,852 624,106 687,792 634,809 617,759
Commercial real estate710,784 672,319 660,094 706,188 705,858
Residential mortgage47,010 39,227 41,771 40,730 37,034
Personal65,541 57,023 57,140 55,050 55,528
Total Bank of Arizona1,505,187 1,392,675 1,446,797 1,436,777 1,416,179
Mobank (Kansas City):
Commercial715,224 723,921 717,408 734,559 790,425
Commercial real estate257,920 264,025 273,116 275,785 300,911
Residential mortgage85,835 92,447 94,844 97,092 98,479
Personal93,837 107,172 106,512 110,611 109,515
Total Mobank (Kansas City)1,152,816 1,187,565 1,191,880 1,218,047 1,299,330
TOTAL BOK FINANCIAL$18,003,696 $17,337,850 $17,153,424 $17,206,834 $17,183,645

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

DEPOSITS BY PRINCIPAL MARKET AREA -- UNAUDITEDBOK FINANCIAL CORPORATION(in thousands)
June 30, 2018 Mar. 31, 2018 Dec. 31, 2017 Sept. 30, 2017 June 30, 2017
Bank of Oklahoma:
Demand$3,867,933 $4,201,842 $3,885,008 $4,061,612 $4,353,421
Interest-bearing:
Transaction5,968,460 6,051,302 5,901,293 5,909,259 5,998,787
Savings289,202 289,351 265,870 265,023 263,664
Time1,207,471 1,203,534 1,092,133 1,131,547 1,170,014
Total interest-bearing7,465,133 7,544,187 7,259,296 7,305,829 7,432,465
Total Bank of Oklahoma11,333,066 11,746,029 11,144,304 11,367,441 11,785,886
Bank of Texas:
Demand3,317,656 3,015,869 3,239,098 3,094,184 3,121,890
Interest-bearing:
Transaction2,168,488 2,208,480 2,397,071 2,272,987 2,272,185
Savings97,809 98,852 93,620 93,400 91,491
Time445,500 475,967 502,879 521,072 502,128
Total interest-bearing2,711,797 2,783,299 2,993,570 2,887,459 2,865,804
Total Bank of Texas6,029,453 5,799,168 6,232,668 5,981,643 5,987,694
Bank of Albuquerque:
Demand770,974 695,060 663,353 659,793 612,117
Interest-bearing:
Transaction586,593 555,414 552,393 551,884 558,523
Savings59,415 60,596 55,647 53,532 54,136
Time212,689 216,306 216,743 224,773 229,616
Total interest-bearing858,697 832,316 824,783 830,189 842,275
Total Bank of Albuquerque1,629,671 1,527,376 1,488,136 1,489,982 1,454,392
Bank of Arkansas:
Demand39,896 35,291 30,384 31,442 40,511
Interest-bearing:
Transaction143,298 94,206 85,095 126,746 129,848
Savings1,885 1,960 1,881 1,876 2,135
Time10,771 11,878 14,045 14,434 14,876
Total interest-bearing155,954 108,044 101,021 143,056 146,859
Total Bank of Arkansas195,850 143,335 131,405 174,498 187,370
Colorado State Bank & Trust:
Demand529,912 521,963 633,714 540,300 577,617
Interest-bearing:
Transaction701,362 687,785 657,629 628,807 626,343
Savings38,176 37,232 35,223 34,776 35,651
Time208,049 215,330 224,962 231,927 228,458
Total interest-bearing947,587 940,347 917,814 895,510 890,452
Total Colorado State Bank & Trust1,477,499 1,462,310 1,551,528 1,435,810 1,468,069
Bank of Arizona:
Demand387,952 330,196 334,701 335,740 366,866
Interest-bearing:
Transaction194,353 248,337 274,846 174,010 154,457
Savings3,935 4,116 3,343 4,105 3,638
Time22,447 21,009 20,394 20,831 19,911
Total interest-bearing220,735 273,462 298,583 198,946 178,006
Total Bank of Arizona608,687 603,658 633,284 534,686 544,872
Mobank (Kansas City):
Demand459,636 505,802 457,080 462,410 496,473
Interest-bearing:
Transaction401,545 381,447 382,066 361,391 346,996
Savings13,052 13,845 13,574 12,513 13,603
Time20,805 22,230 27,260 27,705 31,119
Total interest-bearing435,402 417,522 422,900 401,609 391,718
Total Mobank (Kansas City)895,038 923,324 879,980 864,019 888,191
TOTAL BOK FINANCIAL$22,169,264 $22,205,200 $22,061,305 $21,848,079 $22,316,474

NET INTEREST MARGIN TREND -- UNAUDITEDBOK FINANCIAL CORPORATION
Three Months Ended
June 30, 2018 Mar. 31, 2018 Dec. 31, 2017 Sept. 30, 2017 June 30, 2017
TAX-EQUIVALENT ASSETS YIELDS
Interest-bearing cash and cash equivalents1.86% 1.57% 1.27% 1.29% 1.04%
Trading securities3.63% 3.40% 3.38% 3.47% 3.23%
Investment securities:
Taxable5.23% 5.21% 5.31% 5.31% 5.34%
Tax-exempt2.42% 2.25% 2.69% 2.60% 2.51%
Total investment securities3.95% 3.78% 3.98% 3.86% 3.76%
Available for sale securities:
Taxable2.29% 2.22% 2.19% 2.16% 2.09%
Tax-exempt3.26% 3.26% 5.41% 5.27% 6.09%
Total available for sale securities2.30% 2.23% 2.21% 2.17% 2.11%
Fair value option securities3.16% 2.95% 2.90% 2.97% 2.92%
Restricted equity securities6.21% 5.86% 5.87% 5.87% 5.95%
Residential mortgage loans held for sale4.28% 3.71% 3.72% 3.36% 3.92%
Loans4.80% 4.45% 4.29% 4.31% 4.03%
Allowance for loan losses
Loans, net of allowance4.86% 4.51% 4.35% 4.38% 4.09%
Total tax-equivalent yield on earning assets3.91% 3.61% 3.49% 3.50% 3.30%
COST OF INTEREST-BEARING LIABILITIES
Interest-bearing deposits:
Interest-bearing transaction0.55% 0.45% 0.35% 0.32% 0.26%
Savings0.08% 0.07% 0.07% 0.08% 0.08%
Time1.29% 1.25% 1.17% 1.16% 1.11%
Total interest-bearing deposits0.66% 0.57% 0.48% 0.45% 0.40%
Funds purchased and repurchase agreements0.53% 0.40% 0.28% 0.25% 0.13%
Other borrowings1.96% 1.60% 1.36% 1.29% 1.09%
Subordinated debt5.67% 5.61% 5.55% 5.68% 5.55%
Total cost of interest-bearing liabilities1.11% 0.93% 0.79% 0.75% 0.63%
Tax-equivalent net interest revenue spread2.80% 2.68% 2.70% 2.75% 2.67%
Effect of noninterest-bearing funding sources and other0.37% 0.31% 0.27% 0.26% 0.22%
Tax-equivalent net interest margin3.17% 2.99% 2.97% 3.01% 2.89%

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

CREDIT QUALITY INDICATORS -- UNAUDITEDBOK FINANCIAL CORPORATION(in thousands, except ratios)
Three Months Ended
June 30, 2018 Mar. 31, 2018 Dec. 31, 2017 Sept. 30, 2017 June 30, 2017
Nonperforming assets:
Nonaccruing loans:
Commercial$120,978 $131,460 $137,303 $176,900 $197,157
Commercial real estate1,996 2,470 2,855 2,975 3,775
Residential mortgage42,343 45,794 47,447 45,506 44,235
Personal340 340 269 255 272
Total nonaccruing loans165,657 180,064 187,874 225,636 245,439
Accruing renegotiated loans guaranteed by U.S. government agencies75,374 74,418 73,994 69,440 80,624
Real estate and other repossessed assets27,891 23,652 28,437 32,535 39,436
Total nonperforming assets$268,922 $278,134 $290,305 $327,611 $365,499
Total nonperforming assets excluding those guaranteed by U.S. government agencies$185,981 $194,833 $207,132 $249,280 $275,823
Nonaccruing loans by loan class:
Commercial:
Energy$65,597 $89,942 $92,284 $110,683 $123,992
Services4,377 2,109 2,620 1,174 7,754
Healthcare16,125 15,342 14,765 24,446 24,505
Wholesale/retail14,095 2,564 2,574 1,893 10,620
Manufacturing2,991 3,002 5,962 9,059 9,656
Other commercial and industrial17,793 18,501 19,098 29,645 20,630
Total commercial120,978 131,460 137,303 176,900 197,157
Commercial real estate:
Multifamily— — — — 10
Office275 275 275 275 396
Retail1,068 264 276 289 301
Industrial— — — — —
Residential construction and land development350 1,613 1,832 1,924 2,051
Other commercial real estate303 318 472 487 1,017
Total commercial real estate1,996 2,470 2,855 2,975 3,775
Residential mortgage:
Permanent mortgage23,105 24,578 25,193 24,623 23,415
Permanent mortgage guaranteed by U.S. government agencies7,567 8,883 9,179 8,891 9,052
Home equity11,671 12,333 13,075 11,992 11,768
Total residential mortgage42,343 45,794 47,447 45,506 44,235
Personal340 340 269 255 272
Total nonaccruing loans$165,657 $180,064 $187,874 $225,636 $245,439
Performing loans 90 days past due1$879 $90 $633 $253 $1,414
Gross charge-offs$(15,105) $(2,890) $(14,749) $(5,825) $(2,872)
Recoveries4,578 1,576 3,061 2,437 1,214
Net charge-offs$(10,527) $(1,314) $(11,688) $(3,388) $(1,658)
Provision for credit losses$— $(5,000) $(7,000) $— $—
Allowance for loan losses to period end loans1.19% 1.29% 1.34% 1.44% 1.46%
Combined allowance for credit losses to period end loans1.21% 1.32% 1.37% 1.47% 1.49%
Nonperforming assets to period end loans and repossessed assets1.49% 1.60% 1.69% 1.90% 2.12%
Net charge-offs (annualized) to average loans0.24% 0.03% 0.27% 0.08% 0.04%
Allowance for loan losses to nonaccruing loans1136.09% 130.84% 129.09% 114.28% 105.78%
Combined allowance for credit losses to nonaccruing loans1137.63% 133.25% 131.18% 116.78% 108.51%

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

For Further Information Contact:Joseph Crivelli Investor Relations (918) 595-3030

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Source: BOK Financial Corporation

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