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BOK Financial Corporation Reports Quarterly Earnings of $134 million or $2.04 Per Share in the Third Quarter

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CEO Stacy Kymes reports solid earnings for the third quarter of 2023, driven by a diverse business model and focus on growth opportunities. Net income was $134.5 million, down from $151.3 million in the previous quarter. Net interest revenue decreased to $300.9 million, while fees and commissions revenue decreased to $197.9 million. Operating expenses increased to $324.3 million. The company repurchased 700,500 shares of common stock. Commercial Banking, Consumer Banking, and Wealth Management segments all contributed to net income.
Positive
  • Solid earnings for Q3 2023 driven by diverse business model and growth opportunities
  • Increased loans by almost 9% over previous year
  • Core commercial and industrial loans up 8% from last year
  • Repurchased 700,500 shares of common stock
Negative
  • Net income decreased to $134.5 million from $151.3 million in previous quarter
  • Net interest revenue decreased to $300.9 million
  • Fees and commissions revenue decreased to $197.9 million
  • Operating expenses increased to $324.3 million

TULSA, OK / ACCESSWIRE / October 25, 2023 /

CEO Commentary

Stacy Kymes, president and chief executive officer, stated, "We recognized another solid quarter of earnings driven by our diverse business model, which prudently balances interest revenue with non-interest revenues and allows us to perform well in a multitude of business climates. Non-interest revenues now represent 40% of our total revenues. In addition, we continue to focus on opportunities for growth given the economic vitality of our core geographic footprint as we take advantage of our capital and liquidity strengths. We have increased loans almost 9% over the previous year and our core commercial and industrial loans are up 8% from last year. We're focused on investing in growth initiatives like our San Antonio expansion, which will drive long-term shareholder value. We have consistently proven that our business diversification coupled with our outstanding team outperforms against strong headwinds."

Third Quarter 2023 Financial Highlights
(Unless indicated otherwise, all comparisons are to the prior quarter)

  • Net income was $134.5 million or $2.04 per diluted share for the third quarter of 2023 compared to $151.3 million or $2.27 per diluted share for the second quarter of 2023.
  • Net interest revenue totaled $300.9 million, a decrease of $21.4 million compared to the prior quarter. Net interest margin was 2.69 percent compared to 3.00 percent. Growth in low-spread U.S. government agency residential mortgage-backed trading assets drove an 8 basis point decline in net interest margin with deposit repricing activity primarily driving the remaining 23 basis point reduction. For the third quarter of 2023, our core net interest margin excluding trading activities, a non-GAAP measure, was 3.14 percent compared to 3.36 percent in the prior quarter.
  • Fees and commissions revenue decreased $2.6 million to $197.9 million. Decreased brokerage and trading revenue and mortgage banking revenue were partially offset by increased other revenue.
  • Operating expense increased $5.6 million to $324.3 million. Personnel expense was relatively unchanged, while non-personnel expense increased $5.5 million, primarily due to higher occupancy and equipment costs and other expenses.
  • Other gains and losses, net decreased $11.1 million to $1.5 million. The prior quarter included gains on alternative investments, primarily attributable to merchant banking activity.
  • Period-end loans grew by $486 million to $23.7 billion at September 30, 2023, mostly driven by growth in commercial loans and commercial real estate loans secured by multifamily properties. Average outstanding loan balances were $23.4 billion, a $525 million increase.
  • The provision for credit losses of $7.0 million in the third quarter of 2023 reflects our continued loan growth and changes in our economic forecast. Net charge-offs were $6.5 million or 0.11 percent of average loans on an annualized basis in the third quarter. The resulting combined allowance for credit losses totaled $325 million or 1.37 percent of outstanding loans at September 30, 2023 compared to $323 million or 1.39 percent of outstanding loans at June 30, 2023.
  • Period-end deposits increased $358 million to $33.7 billion while average deposits increased $918 million to $33.3 billion. Average interest-bearing deposits increased $1.8 billion while average demand deposits declined by $840 million. The loan to deposit ratio was 70 percent at September 30, 2023, consistent with June 30, 2023.
  • The company's tangible common equity ratio, a non-GAAP measure, was 7.74 percent at September 30, 2023 and 7.79 percent at June 30, 2023. The tangible common equity ratio is primarily based on total shareholders' equity, which includes unrealized gains and losses on available for sale securities. Adjusted for all unrealized securities portfolio gains and losses, including those in the investment portfolio, the tangible common equity ratio would be 7.35 percent.
  • The company's common equity Tier 1 capital ratio was 12.06 percent at September 30, 2023. In addition, the company's Tier 1 capital ratio was 12.07 percent, total capital ratio was 13.16 percent, and leverage ratio was 9.52 percent at September 30, 2023. At June 30, 2023, the company's common equity Tier 1 capital ratio was 12.13 percent, Tier 1 capital ratio was 12.13 percent, total capital ratio was 13.24 percent, and leverage ratio was 9.75 percent.
  • The company repurchased 700,500 shares of common stock at an average price paid of $84.17 a share in the third quarter of 2023.

Third Quarter 2023 Segment Highlights

  • Commercial Banking contributed $157.9 million to net income in the third quarter of 2023, a decrease of $12.2 million compared to the second quarter of 2023. Combined net interest revenue and fee revenue decreased $7.5 million due to a shift in deposit balances from demand to interest-bearing transaction accounts combined with a decline in customer hedging revenue, primarily related to our energy customers. Net loans charged-off decreased $1.1 million to $4.9 million in the third quarter of 2023. Personnel expense increased $2.8 million, driven primarily by incentive compensation costs and market expansion. Non-personnel expense increased $1.5 million, led by the retirement of certain ATMs as we upgrade our network. The prior quarter included a gain on alternative investments of $8.1 million resulting from merchant banking activities. Average loans increased $486 million or 3 percent to $19.6 billion. Average deposits increased $276 million or 2 percent to $15.1 billion.
  • Consumer Banking contributed $58.0 million to net income in the third quarter of 2023, a decrease of $2.3 million compared the prior quarter. Combined net interest revenue and fee revenue decreased $2.4 million, largely due to a decrease in mortgage banking revenue from lower production volumes combined with narrowing margins and spread compression on residential mortgage loans. Operating expense increased $2.2 million. Average loans increased $50 million or 3 percent to $1.8 billion. Average deposits were mostly unchanged from the previous quarter.
  • Wealth Management contributed $43.0 million to net income in the third quarter of 2023, a decrease of $14.3 million compared to the second quarter of 2023. Combined net interest and fee revenue decreased $12.4 million, primarily due to declining spreads on loans and deposits. Total revenue from institutional trading activities decreased $4.4 million, largely related to our municipal bond trading activity. Investment banking revenue increased $4.7 million resulting from increased underwriting fees and financial advisory fees. Personnel expense increased $1.4 million due to growth in regular compensation from business expansion. Non-personnel expense increased $3.1 million, primarily due to ongoing technology project costs. Average loans were consistent with the prior quarter at $2.2 billion. Average deposits increased $343 million or 5 percent to $7.9 billion. Assets under management or administration were $99.0 billion, a decrease of $4.6 billion.

Net Interest Revenue

Net interest revenue was $300.9 million for the third quarter of 2023 compared to $322.3 million for the prior quarter. Net interest margin was 2.69 percent compared to 3.00 percent. Growth in low-spread trading assets drove an 8 basis point decline in net interest margin while deposit price competition and liability mix shift are the primary drivers of the the remaining 23 basis point decline. For the third quarter of 2023, our core net interest margin excluding trading activities, a non-GAAP measure, was 3.14 percent compared to 3.36 percent in the prior quarter.

Average earning assets increased $1.3 billion. Average trading securities grew $1.2 billion, spurred by favorable market opportunities for U.S. government agency residential mortgage-backed securities observed primarily throughout the second quarter and extending into the early part of the third quarter. Average loan balances increased $525 million, largely due to growth in commercial and commercial real estate loans. Average fair value option securities, held as an economic hedge of the changes in fair value of our mortgage servicing rights, decreased $204 million. Average available for sale securities decreased $108 million and average interest-bearing cash and cash equivalents decreased $110 million. Average interest-bearing deposits increased $1.8 billion. Average other borrowings increased $1.7 billion while funds purchased and repurchase agreements declined $972 million.

The yield on average earning assets was 5.49 percent, up 20 basis points. The loan portfolio yield increased 22 basis points to 7.25 percent while the yield on the available for sale securities portfolio increased 11 basis points to 3.11 percent. The yield on trading securities grew 26 basis points to 4.76 percent.

Funding costs were 3.81 percent, up 54 basis points. The cost of interest-bearing deposits increased 61 basis points to 3.17 percent. The cost of other borrowings was up 36 basis points to 5.48 percent while the cost of funds purchased and repurchase agreements increased 23 basis points to 4.81 percent. The benefit to net interest margin from assets funded by non-interest liabilities was 101 basis points, an increase of 3 basis points.

Fees and Commissions Revenue

Fees and commissions revenue totaled $197.9 million for the third quarter of 2023, a decrease of $2.6 million compared to the prior quarter.

Brokerage and trading revenue decreased $2.7 million, with a $2.5 million reduction in trading revenue, primarily related to our municipal bond trading activity, which was influenced by the rising interest rate environment and evolving market expectations during the third quarter. Customer hedging revenue decreased $6.8 million following a record high in the second quarter. Investment banking revenue grew $5.7 million, primarily related to underwriting fees and financial advisory fees produced by our Public and Corporate Finance group, which underwrites municipal bonds such as independent school districts.

Mortgage banking revenue decreased $1.8 million, largely due lower mortgage production and qualifying residential mortgage loans guaranteed by U.S. government agencies previously in forbearance that have been resold into GNMA pools following the applicable performance period specified by the programs. Mortgage production volume was down $30.1 million reflecting the rise in mortgage interest rates and continued low inventory in the housing market.

Other revenue increased $1.6 million, largely due to increased margin interest fees and letter of credit fees.

Operating Expense

Total operating expense was $324.3 million for the third quarter of 2023, an increase of $5.6 million compared to the second quarter of 2023.

Personnel expense was $190.8 million, consistent with the prior quarter. A $2.0 million increase in regular compensation due to business expansion was mostly offset by a decrease in employee benefits expense driven by seasonal declines in payroll taxes.

Non-personnel expense was $133.5 million, an increase of $5.5 million. Occupancy and equipment costs grew $2.5 million driven by the retirement of certain ATMs as we upgrade our network. Other expense increased $2.9 million, primarily due to an accrual for certain disputed matters. FDIC insurance expense also increased $1.0 million.

Loans, Deposits and Capital

Loans

Outstanding loans were $23.7 billion at September 30, 2023, growing $486 million over June 30, 2023, largely due to growth in commercial and commercial real estate loans. Unfunded loan commitments decreased $575 million compared to the second quarter of 2023 due primarily to the funding of existing commercial real estate loan commitments.

Outstanding commercial loan balances, which includes healthcare, services, energy and general business loans, increased $185 million over the prior quarter.

Healthcare sector loan balances increased $92 million, totaling $4.1 billion or 17 percent of total loans. Our healthcare sector loans primarily consist of $3.4 billion of senior housing and care facilities, including independent living, assisted living and skilled nursing. Generally, we loan to borrowers with a portfolio of multiple facilities, which serves to help diversify risks specific to a single facility.

General business loans increased $131 million to $3.6 billion or 15 percent of total loans. General business loans include $2.2 billion of wholesale/retail loans and $1.4 billion of loans from other commercial industries.

Services sector loan balances decreased $19 million to $3.6 billion or 15 percent of total loans. Services loans consist of a large number of loans to a variety of businesses, including Native American tribal and state and local municipal government entities, Native American tribal casino operations, foundations and not-for-profit organizations, educational services and specialty trade contractors.

Energy loan balances decreased $18 million to $3.5 billion or 15 percent of total loans. The majority of this portfolio is first lien, senior secured, reserve-based lending to oil and gas producers, which we believe is the lowest risk form of energy lending. Approximately 69 percent of committed production loans are secured by properties primarily producing oil. The remaining 31 percent is secured by properties primarily producing natural gas. Unfunded energy loan commitments were $4.1 billion at September 30, 2023, a $219 million decrease compared June 30, 2023.

Commercial real estate loan balances grew $270 million and represent 22 percent of total loans. Loans secured by multifamily properties increased $232 million to $1.7 billion. Loans secured by industrial facilities increased $83 million to $1.4 billion. This growth was partially offset by a $24 million decrease in loans secured by office facilities. Unfunded commercial real estate loan commitments were $2.0 billion at September 30, 2023, a decrease of $411 million compared to June 30, 2023. We take a disciplined approach to managing our concentration of commercial real estate loan commitments as a percentage of Tier 1 Capital. While loan commitments are presently near the upper internal concentration limit, we expect continued modest growth in our commercial real estate balances as loans fund, primarily in the multifamily and industrial loan portfolios.

Loans to individuals increased $31 million and represent 16 percent of total loans. Residential mortgage loans increased $72 million while personal loans decreased $42 million.

Liquidity and Capital

Our funding sources, which primarily include deposits and borrowings from the Federal Home Loan Banks, provide adequate liquidity to meet our needs. The loan to deposit ratio was 70 percent at September 30, 2023, consistent with the prior quarter, providing significant on-balance sheet liquidity to meet future loan demand and contractual obligations.

Period-end deposits totaled $33.7 billion at September 30, 2023, a $358 million increase. Interest-bearing transaction account balances increased $989 million while time deposits increased $221 million. Demand deposits decreased $808 million. We do not rely on brokered certificates of deposit as a significant source of funding. Time deposits included $688 million of brokered certificates of deposit, a $72 million decrease compared to June 30, 2023.

Average deposits were $33.3 billion at September 30, 2023, a $918 million increase. Average interest-bearing transaction account balances increased $1.0 billion and average time deposits increased $764 million. Average demand deposit account balances decreased $840 million. Average Commercial Banking deposits increased $276 million to $15.1 billion or 45 percent of total deposits. Our commercial deposit portfolio is highly diversified across industries and customers. The highest concentration by industry within our commercial deposit portfolio is with our energy customers representing 6 percent of our total deposits. Wealth Management deposits increased $343 million to $7.9 billion or 24 percent of total deposits. Consumer Banking deposits decreased $50 million to $7.9 billion or 24 percent of total deposits.

The company's common equity Tier 1 capital ratio was 12.06 percent at September 30, 2023. In addition, the company's Tier 1 capital ratio was 12.07 percent, total capital ratio was 13.16 percent, and leverage ratio was 9.52 percent at September 30, 2023. At the beginning of 2020, we elected to delay the regulatory capital impact of the transition of the allowance for credit losses from the incurred loss methodology to CECL for two years, followed by a three-year transition period. This election added 6 basis points to the company's common equity tier 1 capital ratio at September 30, 2023. At June 30, 2023, the company's common equity Tier 1 capital ratio was 12.13 percent, Tier 1 capital ratio was 12.13 percent, total capital ratio was 13.24 percent, and leverage ratio was 9.75 percent.

The company's tangible common equity ratio, a non-GAAP measure, was 7.74 percent at September 30, 2023 and 7.79 percent at June 30, 2023. The tangible common equity ratio is primarily based on total shareholders' equity, which includes unrealized gains and losses on available for sale securities. Adjusted for all unrealized securities portfolio gains and losses, including those in the investment portfolio, the tangible common equity ratio would be 7.35 percent. 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.

The company repurchased 700,500 shares of common stock at an average price paid of $84.17 a share in the third quarter of 2023. We view share buybacks opportunistically, but within the context of maintaining our strong capital position.

Credit Quality

Nonperforming assets totaled $123 million or 0.52 percent of outstanding loans and repossessed assets at September 30, 2023, compared to $136 million or 0.59 percent at June 30, 2023. Excluding loans guaranteed by U.S. government agencies, nonperforming assets totaled $113 million or 0.48 percent of outstanding loans and repossessed assets at September 30, 2023, compared to $125 million or 0.54 percent at June 30, 2023.

Nonaccruing loans decreased $13 million compared to June 30, 2023. New nonaccruing loans identified in the third quarter totaled $11 million, offset by $12 million in payments received and $11 million of charge-offs. Nonaccruing commercial real estate loans decreased $10 million and nonaccruing general business loans decreased $5.5 million, partially offset by a $5.1 million increase in nonaccruing healthcare loans.

Net charge-offs were $6.5 million or 0.11 percent of average loans on an annualized basis in the third quarter. Charge-offs for the third quarter were primarily composed of a $4.6 million general business loan, a $2.2 million commercial real estate loan and a $1.5 million services loan.

The provision for credit losses of $7.0 million in the third quarter of 2023 reflects continued loan growth and changes in our economic forecast. The provision for credit losses was $17.0 million in the second quarter of 2023.

At September 30, 2023, the combined allowance for loan losses and accrual for off-balance sheet credit risk from unfunded loan commitments was $325 million or 1.37 percent of outstanding loans and 298 percent of nonaccruing loans.

Securities and Derivatives

The fair value of the available for sale securities portfolio totaled $11.9 billion at September 30, 2023, largely unchanged compared to June 30, 2023. At September 30, 2023, the available for sale securities portfolio consisted primarily of $6.2 billion of residential mortgage-backed securities fully backed by U.S. government agencies and $4.5 billion of commercial mortgage-backed securities fully backed by U.S. government agencies. At September 30, 2023, the available for sale securities portfolio had a net unrealized loss of $1.0 billion compared to $899 million at June 30, 2023.

We hold an inventory of trading securities in support of sales to a variety of customers. At September 30, 2023, the trading securities portfolio totaled $4.7 billion compared to $5.4 billion at June 30, 2023.

The company also maintains a portfolio of residential mortgage-backed securities issued by U.S. government agencies and interest rate derivative contracts as an economic hedge of the changes in the fair value of our mortgage servicing rights. This portfolio of fair value option securities decreased $192 million to $20 million at September 30, 2023.

Derivative contracts are carried at fair value. At September 30, 2023, the net fair values of derivative contracts, before consideration of cash margin, reported as assets under our customer derivative programs totaled $594 million compared to $538 million at June 30, 2023. The aggregate net fair value of derivative contracts, before consideration of cash margin, held under these programs reported as liabilities totaled $582 million at September 30, 2023 and $526 million at June 30, 2023.

The net cost of the changes in the fair value of mortgage servicing rights and related economic hedges was $1.3 million during the third quarter of 2023, including a $9.2 million decrease in the fair value of securities and derivative contracts held as an economic hedge, an $8.0 million increase in the fair value of mortgage servicing rights and $112 thousand of related net interest expense.

Conference Call and Webcast

The company will hold a conference call at 9 a.m. Central time on Wednesday, October 25, 2023 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 1-844-512-2921 and referencing conference ID # 13741617.

About BOK Financial Corporation

BOK Financial Corporation is a $49 billion regional financial services company headquartered in Tulsa, Oklahoma with $99 billion in assets under management or administration. The company's stock is publicly traded on NASDAQ under the Global Select market listings (BOKF). BOK Financial Corporation's holdings include BOKF, NA; BOK Financial Securities, Inc., BOK Financial Private Wealth, Inc. and BOK Financial Insurance, Inc. BOKF, NA's holdings include TransFund, Cavanal Hill Investment Management, Inc. and BOK Financial Asset Management, Inc. BOKF, NA operates banking divisions across eight states as: Bank of Albuquerque; Bank of Oklahoma; Bank of Texas; and BOK Financial in Arizona, Arkansas, Colorado, Kansas and Missouri; as well as having limited purpose offices in Nebraska, Wisconsin, Connecticut and Tennessee. Through its subsidiaries, BOK Financial Corporation provides commercial and consumer banking, brokerage trading, investment, trust and insurance services, mortgage origination and servicing, and an electronic funds transfer network. For more information, visit www.bokf.com.

The company will continue to evaluate critical assumptions and estimates, such as the appropriateness of the allowance for credit losses and asset impairment as of September 30, 2023 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 Corporation, 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 acquisitions and 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 various forward-looking 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 government, changes in commodity prices, interest rates and interest rate relationships, inflation, demand for products and services, the degree of competition by traditional and nontraditional competitors, changes in banking regulations, tax laws, prices, levies and assessments, the impact of technological advances, and trends in customer behavior as well as their ability to repay loans. BOK Financial Corporation and its affiliates undertake no obligation to update, amend or clarify forward-looking statements, whether as a result of new information, future events, or otherwise.

BALANCE SHEETS - UNAUDITED
BOK FINANCIAL CORPORATION
(In thousands)


 Sep. 30, 2023 June 30, 2023
ASSETS

Cash and due from banks
 $854,161 $875,714
Interest-bearing cash and cash equivalents
 520,774 571,616
Trading securities
 4,748,101 5,442,364
Investment securities, net of allowance
 2,298,418 2,374,071
Available for sale securities
 11,906,647 11,938,523
Fair value option securities
 20,215 212,321
Restricted equity securities
 435,112 330,086
Residential mortgage loans held for sale
 72,489 94,820
Loans:
Commercial
 14,719,839 14,534,516
Commercial real estate
 5,241,300 4,970,801
Loans to individuals
 3,762,879 3,732,342
Total loans
 23,724,018 23,237,659
Allowance for loan losses
 (272,114) (262,714)
Loans, net of allowance
 23,451,904 22,974,945
Premises and equipment, net
 616,439 617,918
Receivables
 255,164 263,915
Goodwill
 1,044,749 1,044,749
Intangible assets, net
 65,804 69,246
Mortgage servicing rights
 311,382 304,722
Real estate and other repossessed assets, net
 3,753 4,227
Derivative contracts, net
 546,109 353,037
Cash surrender value of bank-owned life insurance
 406,623 411,084
Receivable on unsettled securities sales
 28,707 133,909
Other assets
 1,344,846 1,220,653
TOTAL ASSETS
 $48,931,397 $49,237,920

LIABILITIES AND EQUITY
Deposits:
Demand
 $9,974,223 $10,782,548
Interest-bearing transaction
 19,897,179 18,907,981
Savings
 853,933 897,937
Time
 2,927,217 2,706,377
Total deposits
 33,652,552 33,294,843
Funds purchased and repurchase agreements
 2,722,998 5,446,864
Other borrowings
 6,201,644 3,777,056
Subordinated debentures
 131,152 131,154
Accrued interest, taxes and expense
 244,105 228,797
Due on unsettled securities purchases
 235,473 400,430
Derivative contracts, net
 403,947 550,653
Other liabilities
 522,318 540,726
TOTAL LIABILITIES
 44,114,189 44,370,523
Shareholders' equity:
Capital, surplus and retained earnings
 5,743,004 5,700,526
Accumulated other comprehensive loss
 (928,985) (836,672)
TOTAL SHAREHOLDERS' EQUITY
 4,814,019 4,863,854
Non-controlling interests
 3,189 3,543
TOTAL EQUITY
 4,817,208 4,867,397
TOTAL LIABILITIES AND EQUITY
 $48,931,397 $49,237,920

AVERAGE BALANCE SHEETS - UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands)


 Three Months Ended

Sep. 30, 2023 June 30, 2023 Mar. 31, 2023 Dec. 31, 2022 Sep. 30, 2022
ASSETS




Interest-bearing cash and cash equivalents
 $598,734 $708,475 $616,596 $568,307 $748,263
Trading securities
 5,444,587 4,274,803 3,031,969 3,086,985 3,178,068
Investment securities, net of allowance
 2,331,595 2,408,122 2,473,796 2,535,305 2,593,989
Available for sale securities
 11,925,800 12,033,597 11,738,693 10,953,851 10,306,257
Fair value option securities
 41,741 245,469 300,372 92,012 36,846
Restricted equity securities
 445,532 351,944 316,724 216,673 173,656
Residential mortgage loans held for sale
 77,208 72,959 65,769 98,613 132,685
Loans:
Commercial
 14,527,676 14,316,474 14,046,237 13,846,339 13,508,325
Commercial real estate
 5,172,876 4,896,230 4,757,362 4,488,091 4,434,650
Loans to individuals
 3,713,756 3,676,350 3,672,648 3,641,574 3,656,257
Total loans
 23,414,308 22,889,054 22,476,247 21,976,004 21,599,232
Allowance for loan losses
 (267,205) (252,890) (238,909) (242,450) (241,136)
Loans, net of allowance
 23,147,103 22,636,164 22,237,338 21,733,554 21,358,096
Total earning assets
 44,012,300 42,731,533 40,781,257 39,285,300 38,527,860
Cash and due from banks
 799,291 875,280 857,771 865,796 821,801
Derivative contracts, net
 412,707 410,793 546,018 1,239,717 2,019,905
Cash surrender value of bank-owned life insurance
 408,295 409,313 408,124 406,826 410,667
Receivable on unsettled securities sales
 268,344 163,903 177,312 194,996 219,113
Other assets
 3,418,615 3,317,285 3,211,986 3,216,983 3,119,856
TOTAL ASSETS
 $49,319,552 $47,908,107 $45,982,468 $45,209,618 $45,119,202

LIABILITIES AND EQUITY
Deposits:
Demand
 $10,157,821 $10,998,201 $12,406,408 $14,176,189 $15,105,305
Interest-bearing transaction
 19,415,599 18,368,592 18,639,900 18,898,315 19,556,806
Savings
 874,530 926,882 958,443 969,275 978,596
Time
 2,839,947 2,076,037 1,477,720 1,417,606 1,409,069
Total deposits
 33,287,897 32,369,712 33,482,471 35,461,385 37,049,776
Funds purchased and repurchase agreements
 2,699,027 3,670,994 1,759,237 1,046,447 800,759
Other borrowings
 6,968,309 5,275,291 4,512,280 2,523,195 1,528,887
Subordinated debentures
 131,151 131,153 131,166 131,180 131,199
Derivative contracts, net
 429,989 576,558 428,023 445,105 105,221
Due on unsettled securities purchases
 435,927 436,353 316,738 575,957 331,428
Other liabilities
 461,686 503,134 511,530 408,029 396,510
TOTAL LIABILITIES
 44,413,986 42,963,195 41,141,445 40,591,298 40,343,780
Total equity
 4,905,566 4,944,912 4,841,023 4,618,320 4,775,422
TOTAL LIABILITIES AND EQUITY
 $49,319,552 $47,908,107 $45,982,468 $45,209,618 $45,119,202

STATEMENTS OF EARNINGS - UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands, except per share data)


 Three Months Ended Nine Months Ended

September 30, September 30,

2023 2022 2023 2022





Interest revenue
 $617,044 $363,150 $1,704,140 $940,496
Interest expense
 316,148 46,825 728,635 81,742
Net interest revenue
 300,896 316,325 975,505 858,754
Provision for credit losses
 7,000 15,000 40,000 15,000
Net interest revenue after provision for credit losses
 293,896 301,325 935,505 843,754
Other operating revenue:
Brokerage and trading revenue
 62,312 61,006 179,714 77,970
Transaction card revenue
 26,387 25,974 78,011 77,130
Fiduciary and asset management revenue
 52,256 50,190 155,910 146,427
Deposit service charges and fees
 27,676 28,703 80,744 84,207
Mortgage banking revenue
 13,356 11,282 42,864 39,300
Other revenue
 15,865 15,479 47,085 38,608
Total fees and commissions
 197,852 192,634 584,328 463,642
Other gains (losses), net
 1,474 979 16,343 (8,304)
Loss on derivatives, net
 (9,010) (17,009) (18,513) (77,559)
Loss on fair value option securities, net
 (203) (4,368) (5,323) (17,790)
Change in fair value of mortgage servicing rights
 8,039 16,570 11,241 83,165
Gain (loss) on available for sale securities, net
 - 892 (3,010) 3,017
Total other operating revenue
 198,152 189,698 585,066 446,171
Other operating expense:
Personnel
 190,791 170,348 563,588 484,499
Business promotion
 6,958 6,127 23,167 18,965
Charitable contributions to BOKF Foundation
 23 - 1,165 -
Professional fees and services
 13,224 14,089 39,049 37,977
Net occupancy and equipment
 32,583 29,296 91,147 87,640
Insurance
 7,996 4,306 22,285 13,317
Data processing and communications
 45,672 41,743 135,781 122,859
Printing, postage and supplies
 3,760 4,349 11,381 11,967
Amortization of intangible assets
 3,474 3,943 10,339 11,956
Mortgage banking costs
 8,357 9,504 22,439 26,818
Other expense
 11,475 11,046 28,457 30,026
Total other operating expense
 324,313 294,751 948,798 846,024

Net income before taxes
 167,735 196,272 571,773 443,901
Federal and state income taxes
 33,256 39,681 123,162 92,000

Net income
 134,479 156,591 448,611 351,901
Net income (loss) attributable to non-controlling interests
 (16) 81 440 57
Net income attributable to BOK Financial Corporation shareholders
 $134,495 $156,510 $448,171 $351,844

Average shares outstanding:
Basic
 65,548,307 67,003,199 65,955,294 67,409,789
Diluted
 65,548,307 67,004,623 65,955,294 67,411,222

Net income per share:
Basic
 $2.04 $2.32 $6.74 $5.18
Diluted
 $2.04 $2.32 $6.74 $5.18

QUARTERLY EARNINGS TREND - UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands, except ratio and per share data)


 Three Months Ended

Sep. 30, 2023 June 30, 2023 Mar. 31, 2023 Dec. 31, 2022 Sep. 30, 2022






Interest revenue
 $617,044 $570,367 $516,729 $451,606 $363,150
Interest expense
 316,148 248,106 164,381 98,980 46,825
Net interest revenue
 300,896 322,261 352,348 352,626 316,325
Provision for credit losses
 7,000 17,000 16,000 15,000 15,000
Net interest revenue after provision for credit losses
 293,896 305,261 336,348 337,626 301,325
Other operating revenue:
Brokerage and trading revenue
 62,312 65,006 52,396 63,008 61,006
Transaction card revenue
 26,387 26,003 25,621 27,136 25,974
Fiduciary and asset management revenue
 52,256 52,997 50,657 49,899 50,190
Deposit service charges and fees
 27,676 27,100 25,968 26,429 28,703
Mortgage banking revenue
 13,356 15,141 14,367 10,065 11,282
Other revenue
 15,865 14,250 16,970 17,034 15,479
Total fees and commissions
 197,852 200,497 185,979 193,571 192,634
Other gains (losses), net
 1,474 12,618 2,251 8,427 979
Gain (loss) on derivatives, net
 (9,010) (8,159) (1,344) 4,548 (17,009)
Loss on fair value option securities, net
 (203) (2,158) (2,962) (2,568) (4,368)
Change in fair value of mortgage servicing rights
 8,039 9,261 (6,059) (2,904) 16,570
Gain (loss) on available for sale securities, net
 - (3,010) - (3,988) 892
Total other operating revenue
 198,152 209,049 177,865 197,086 189,698
Other operating expense:
Personnel
 190,791 190,652 182,145 186,419 170,348
Business promotion
 6,958 7,640 8,569 7,470 6,127
Charitable contributions to BOKF Foundation
 23 1,142 - 2,500 -
Professional fees and services
 13,224 12,777 13,048 18,365 14,089
Net occupancy and equipment
 32,583 30,105 28,459 29,227 29,296
Insurance
 7,996 6,974 7,315 4,677 4,306
Data processing and communications
 45,672 45,307 44,802 43,048 41,743
Printing, postage and supplies
 3,760 3,728 3,893 3,890 4,349
Amortization of intangible assets
 3,474 3,474 3,391 3,736 3,943
Mortgage banking costs
 8,357 8,300 5,782 9,016 9,504
Other expense
 11,475 8,574 8,408 10,108 11,046
Total other operating expense
 324,313 318,673 305,812 318,456 294,751
Net income before taxes
 167,735 195,637 208,401 216,256 196,272
Federal and state income taxes
 33,256 44,001 45,905 47,864 39,681
Net income
 134,479 151,636 162,496 168,392 156,591
Net income (loss) attributable to non-controlling interests
 (16) 328 128 (37) 81
Net income attributable to BOK Financial Corporation shareholders
 $134,495 $151,308 $162,368 $168,429 $156,510

Average shares outstanding:
Basic
 65,548,307 65,994,132 66,331,775 66,627,955 67,003,199
Diluted
 65,548,307 65,994,132 66,331,775 66,627,955 67,004,623
Net income per share:
Basic
 $2.04 $2.27 $2.43 $2.51 $2.32
Diluted
 $2.04 $2.27 $2.43 $2.51 $2.32

FINANCIAL HIGHLIGHTS - UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands, except ratio and share data)


 Three Months Ended

Sep. 30, 2023 June 30, 2023 Mar. 31, 2023 Dec. 31, 2022 Sep. 30, 2022
Capital:




Period-end shareholders' equity
 $4,814,019 $4,863,854 $4,874,786 $4,682,649 $4,509,934
Risk weighted assets
 $38,791,023 $38,218,164 $37,192,197 $38,142,231 $36,866,994
Risk-based capital ratios:
Common equity tier 1
 12.06% 12.13% 12.19% 11.69% 11.80%
Tier 1
 12.07% 12.13% 12.20% 11.71% 11.82%
Total capital
 13.16% 13.24% 13.21% 12.67% 12.81%
Leverage ratio
 9.52% 9.75% 9.94% 9.91% 9.76%
Tangible common equity ratio 1
 7.74% 7.79% 8.46% 7.63% 7.96%
Adjusted tangible common equity ratio 1
 7.35% 7.49% 8.22% 7.36% 7.66%
Common stock:
Book value per share
 $73.31 $73.28 $73.19 $69.93 $67.06
Tangible book value per share
 $56.40 $56.50 $56.42 $53.19 $50.34
Market value per share:
High
 $92.41 $90.91 $106.47 $110.28 $95.51
Low
 $77.61 $74.40 $80.00 $88.46 $69.82
Cash dividends paid
 $35,655 $35,879 $36,006 $36,188 $35,661
Dividend payout ratio
 26.51% 23.71% 22.18% 21.49% 22.79%
Shares outstanding, net
 65,664,840 66,369,208 66,600,833 66,958,634 67,254,383
Stock buy-back program:
Shares repurchased
 700,500 266,000 447,071 314,406 548,034
Amount
 $58,961 $22,366 $44,100 $32,429 $49,980
Average price paid per share 2
 $84.17 $84.08 $98.64 $103.14 $91.20

Performance ratios (quarter annualized):
Return on average assets
 1.08% 1.27% 1.43% 1.48% 1.38%
Return on average equity
 10.88% 12.28% 13.61% 14.48% 13.01%
Return on average tangible common equity 1
 14.08% 15.86% 17.71% 19.14% 17.04%
Net interest margin
 2.69% 3.00% 3.45% 3.54% 3.24%
Efficiency ratio 1,3
 64.01% 58.75% 56.79% 56.61% 57.33%
Other data:
Tax equivalent interest
 $2,214 $2,200 $2,285 $2,287 $2,163
Net unrealized loss on available for sale securities
 $(1,034,520) $(898,906) $(741,508) $(865,553) $(935,788)
Mortgage banking:
Mortgage production revenue
 $(1,887) $(284) $(633) $(3,983) $(2,406)
Mortgage loans funded for sale
 $173,727 $214,785 $138,624 $141,090 $260,210
Add: current period-end outstanding commitments
 49,284 55,031 71,693 45,492 75,779
Less: prior period end outstanding commitments
 55,031 71,693 45,492 75,779 106,004
Total mortgage production volume
 $167,980 $198,123 $164,825 $110,803 $229,985

Mortgage loan refinances to mortgage loans funded for sale
 9% 8% 9% 10% 10%
Realized margin on funded mortgage loans
 (0.94)% (0.14)% (1.25)% (1.10)% (0.41)%
Production revenue as a percentage of production volume
 (1.12)% (0.14)% (0.38)% (3.59)% (1.05)%
Mortgage servicing revenue
 $15,243 $15,425 $15,000 $14,048 $13,688
Average outstanding principal balance of mortgage loans serviced for others
 20,719,116 20,807,044 21,121,319 18,923,078 19,070,221
Average mortgage servicing revenue rates
 0.29% 0.30% 0.29% 0.29% 0.28%
Gain (loss) on mortgage servicing rights, net of economic hedge:
Gain (loss) on mortgage hedge derivative contracts, net
 $(8,980) $(8,099) $(1,711) $4,373 $(17,027)
Loss on fair value option securities, net
 (203) (2,158) (2,962) (2,568) (4,368)
Gain (loss) on economic hedge of mortgage servicing rights
 (9,183) (10,257) (4,673) 1,805 (21,395)
Gain (loss) on changes in fair value of mortgage servicing rights
 8,039 9,261 (6,059) (2,904) 16,570
Gain (loss) on changes in fair value of mortgage servicing rights, net of economic hedges, included in other operating revenue
 (1,144) (996) (10,732) (1,099) (4,825)
Net interest revenue (expense) on fair value option securities 4
 (112) (232) 187 (118) 29
Total economic benefit (cost) of changes in the fair value of mortgage servicing rights, net of economic hedges
 $(1,256) $(1,228) $(10,545) $(1,217) $(4,796)

1 See Reconciliation of Non-GAAP Measures following.

2 Excludes 1 percent excise tax on corporate stock repurchases.

3 Prior period ratios have been adjusted to be consistent with the current period presentation.

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

EXPLANATION AND RECONCILIATION OF NON-GAAP MEASURES - UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands, except ratio and share data)


 Three Months Ended

Sep. 30, 2023 June 30, 2023 Mar. 31, 2023 Dec. 31, 2022 Sep. 30, 2022
Reconciliation of tangible common equity ratio and adjusted tangible common equity ratio:




Total shareholders' equity
 $4,814,019 $4,863,854 $4,874,786 $4,682,649 $4,509,934
Less: Goodwill and intangible assets, net
 1,110,553 1,113,995 1,117,438 1,120,880 1,124,582
Tangible common equity
 3,703,466 3,749,859 3,757,348 3,561,769 3,385,352
Add: Unrealized gain (loss) on investment securities, net
 (246,395) (189,152) (140,947) (167,477) (165,206)
Add: Tax effect on unrealized gain (loss) on investment securities, net
 57,949 44,486 33,149 39,196 38,665
Adjusted tangible common equity
 $3,515,020 $3,605,193 $3,649,550 $3,433,488 $3,258,811

Total assets
 $48,931,397 $49,237,920 $45,524,122 $47,790,642 $43,645,446
Less: Goodwill and intangible assets, net
 1,110,553 1,113,995 1,117,438 1,120,880 1,124,582
Tangible assets
 $47,820,844 $48,123,925 $44,406,684 $46,669,762 $42,520,864

Tangible common equity ratio
 7.74% 7.79% 8.46% 7.63% 7.96%
Adjusted tangible common equity ratio
 7.35% 7.49% 8.22% 7.36% 7.66%
Reconciliation of return on average tangible common equity:
Total average shareholders' equity
 $4,902,119 $4,941,352 $4,837,567 $4,613,929 $4,771,123
Less: Average goodwill and intangible assets, net
 1,112,217 1,115,652 1,119,123 1,122,680 1,126,440
Average tangible common equity
 $3,789,902 $3,825,700 $3,718,444 $3,491,249 $3,644,683

Net Income
 134,495 151,308 162,368 168,429 156,510

Return on average tangible common equity
 14.08% 15.86% 17.71% 19.14% 17.04%
Reconciliation of pre-provision net revenue:
Net income before taxes
 $167,735 $195,637 $208,401 $216,256 $196,272
Provision for expected credit losses
 7,000 17,000 16,000 15,000 15,000
Net income (loss) attributable to non-controlling interests
 (16) 328 128 (37) 81
Pre-provision net revenue
 $174,751 $212,309 $224,273 $231,293 $211,191

Calculation of efficiency ratio:
Total other operating expense
 $324,313 $318,673 $305,812 $318,456 $294,751
Less: Amortization of intangible assets
 3,474 3,474 3,391 3,736 3,943
Adjusted total other operating expense
 $320,839 $315,199 $302,421 $314,720 $290,808

Net interest revenue
 $300,896 $322,261 $352,348 $352,626 $316,325
Tax-equivalent adjustment
 2,214 2,200 2,285 2,287 2,163
Tax-equivalent net interest revenue
 303,110 324,461 354,633 354,913 318,488
Total other operating revenue
 198,152 209,049 177,865 197,086 189,698
Less: Gain (loss) on available for sale securities, net
 - (3,010) - (3,988) 892
Adjusted revenue
 $501,262 $536,520 $532,498 $555,987 $507,294

Efficiency ratio
 64.01% 58.75% 56.79% 56.61% 57.33%
Information on net interest revenue and net interest margin excluding trading activities:
Net interest revenue
 $300,896 $322,261 $352,348 $352,626 $316,325
Less: Trading activities net interest revenue
 (7,343) (3,461) 70 (860) 4,478
Net interest revenue excluding trading activities
 308,239 325,722 352,278 353,486 311,847
Tax-equivalent adjustment
 2,214 2,200 2,285 2,287 2,163
Tax-equivalent net interest revenue excluding trading activities
 $310,453 $327,922 $354,563 $355,773 $314,010

Average total earning assets
 $44,012,300 $42,731,533 $40,781,257 $39,285,300 $38,527,860
Less: Average trading activities interest-earning assets
 5,444,587 4,274,803 3,031,969 3,086,985 3,178,068
Average interest-earning assets excluding trading activities
 $38,567,713 $38,456,730 $37,749,288 $36,198,315 $35,349,792

Net interest margin on average interest-earning assets
 2.69% 3.00% 3.45% 3.54% 3.24%
Net interest margin on average trading activities interest-earning assets
 (0.49)% (0.34)% -% (0.12)% 0.53%
Net interest margin on average interest-earning assets excluding trading activities
 3.14% 3.36% 3.72% 3.84% 3.49%

Explanation of Non-GAAP Measures

The tangible common equity ratio and return on average tangible common equity are primarily based on total shareholders' equity, which includes unrealized gains and losses on available for sale securities, less intangible assets and equity that does not benefit common shareholders. The adjusted tangible common equity ratio also includes unrealized gains and losses on the investment portfolio. These measures are valuable indicators of a financial institution's capital strength since they eliminate intangible assets from shareholders' equity and retain the effect of unrealized losses on securities and other components of accumulated other comprehensive income in shareholders' equity.

Pre-provision net revenue is a measure of revenue less expenses, and is calculated before provision for credit losses and income tax expense. This financial measure is frequently used by investors and analysts and enables them to assess a company's ability to generate earnings to cover credit losses through a credit cycle. It also provides an additional basis for comparing the results of operations between periods by isolating the impact of the provision for credit losses, which can vary significantly between periods.

The efficiency ratio measures the Company's ability to use its assets and manage its liabilities effectively in the current period. Prior to the second quarter of 2023, the efficiency ratio did not exclude amortization of intangible assets and only included tax-equivalent net interest revenue and fees and commissions as part of total revenue. All prior periods were adjusted to conform with the current methodology.

Net interest revenue and net interest margin excluding trading activities removes the effect of trading activities on these metrics allowing management and investors to assess the performance of the Company's core lending and deposit activities without the associated volatility from trading activities.

LOANS TREND - UNAUDITED
BOK FINANCIAL CORPORATION
(In thousands)


 Sep. 30, 2023 June 30, 2023 Mar. 31, 2023 Dec. 31, 2022 Sep. 30, 2022
Commercial:




Healthcare
 $4,083,134 $3,991,387 $3,899,341 $3,845,017 $3,826,623
Services
 3,566,361 3,585,169 3,563,702 3,431,521 3,280,925
Energy
 3,490,602 3,508,752 3,398,057 3,424,790 3,371,588
General business
 3,579,742 3,449,208 3,356,249 3,511,171 3,148,783
Total commercial
 14,719,839 14,534,516 14,217,349 14,212,499 13,627,919

Commercial real estate:
Multifamily
 1,734,688 1,502,971 1,363,881 1,212,883 1,126,700
Industrial
 1,432,629 1,349,709 1,309,435 1,221,501 1,103,905
Office
 981,876 1,005,660 1,045,700 1,053,331 1,086,615
Retail
 608,073 617,886 618,264 620,518 635,021
Residential construction and land development
 100,465 106,370 102,828 95,684 91,690
Other commercial real estate
 383,569 388,205 375,208 402,860 429,980
Total commercial real estate
 5,241,300 4,970,801 4,815,316 4,606,777 4,473,911

Loans to individuals:
Residential mortgage
 2,090,992 1,993,690 1,926,027 1,890,784 1,851,836
Residential mortgages guaranteed by U.S. government agencies
 161,092 186,170 224,753 245,940 262,466
Personal
 1,510,795 1,552,482 1,566,608 1,601,150 1,574,325
Total loans to individuals
 3,762,879 3,732,342 3,717,388 3,737,874 3,688,627

Total
 $23,724,018 $23,237,659 $22,750,053 $22,557,150 $21,790,457

LOANS MANAGED BY PRINCIPAL MARKET AREA - UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands)


 Sep. 30, 2023 June 30, 2023 Mar. 31, 2023 Dec. 31, 2022 Sep. 30, 2022
Texas:
Commercial
 $7,249,963 $7,223,820 $7,103,166 $6,878,618 $6,644,890
Commercial real estate
 1,873,477 1,748,796 1,675,831 1,555,508 1,448,590
Loans to individuals
 961,299 974,911 992,343 982,700 970,459
Total Texas
 10,084,739 9,947,527 9,771,340 9,416,826 9,063,939

Oklahoma:
Commercial
 3,384,627 3,251,547 3,178,934 3,382,577 3,108,608
Commercial real estate
 601,087 573,559 574,708 582,109 608,856
Loans to individuals
 2,100,974 2,079,311 2,049,472 2,077,124 2,054,362
Total Oklahoma
 6,086,688 5,904,417 5,803,114 6,041,810 5,771,826

Colorado:
Commercial
 2,219,460 2,179,473 2,148,066 2,149,199 2,117,181
Commercial real estate
 710,552 683,973 646,537 613,912 565,057
Loans to individuals
 227,569 223,200 231,368 241,902 237,981
Total Colorado
 3,157,581 3,086,646 3,025,971 3,005,013 2,920,219

Arizona:
Commercial
 1,173,491 1,177,778 1,115,973 1,124,289 1,103,000
Commercial real estate
 1,014,151 926,750 881,465 860,947 850,319
Loans to individuals
 260,282 242,102 240,556 229,872 225,981
Total Arizona
 2,447,924 2,346,630 2,237,994 2,215,108 2,179,300

Kansas/Missouri:
Commercial
 307,725 309,148 318,782 310,715 307,456
Commercial real estate
 547,708 516,299 489,951 479,968 466,955
Loans to individuals
 132,137 138,960 129,580 131,307 125,039
Total Kansas/Missouri
 987,570 964,407 938,313 921,990 899,450

New Mexico:
Commercial
 297,714 287,443 280,945 263,349 258,754
Commercial real estate
 405,989 425,472 449,715 417,008 426,367
Loans to individuals
 69,418 64,803 65,770 67,163 68,095
Total New Mexico
 773,121 777,718 796,430 747,520 753,216

Arkansas:
Commercial
 86,859 105,307 71,483 103,752 88,030
Commercial real estate
 88,336 95,952 97,109 97,325 107,767
Loans to individuals
 11,200 9,055 8,299 7,806 6,710
Total Arkansas
 186,395 210,314 176,891 208,883 202,507

TOTAL BOK FINANCIAL
 $23,724,018 $23,237,659 $22,750,053 $22,557,150 $21,790,457

Loans attributed to a principal market may not always represent the location of the borrower or the collateral.

DEPOSITS BY PRINCIPAL MARKET AREA - UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands)


 Sep. 30, 2023 June 30, 2023 Mar. 31, 2023 Dec. 31, 2022 Sep. 30, 2022
Oklahoma:
Demand
 $4,019,019 $4,273,136 $4,369,944 $4,585,963 $5,143,405
Interest-bearing:
Transaction
 9,970,955 9,979,534 9,468,100 9,475,528 9,619,419
Savings
 508,619 531,536 564,829 555,407 558,256
Time
 2,019,749 1,945,916 942,787 794,002 776,306
Total interest-bearing
 12,499,323 12,456,986 10,975,716 10,824,937 10,953,981
Total Oklahoma
 16,518,342 16,730,122 15,345,660 15,410,900 16,097,386

Texas:
Demand
 2,599,998 2,876,568 3,154,789 3,873,759 4,609,255
Interest-bearing:
Transaction
 5,046,288 4,532,093 4,366,932 4,878,482 4,781,920
Savings
 154,863 162,704 175,012 178,356 179,049
Time
 436,218 377,424 321,774 356,538 343,015
Total interest-bearing
 5,637,369 5,072,221 4,863,718 5,413,376 5,303,984
Total Texas
 8,237,367 7,948,789 8,018,507 9,287,135 9,913,239

Colorado:
Demand
 1,598,622 1,726,130 1,869,194 2,462,891 2,510,179
Interest-bearing:
Transaction
 1,888,026 1,825,295 2,126,435 2,123,218 2,221,796
Savings
 63,129 66,968 72,548 77,961 80,542
Time
 185,030 148,840 128,583 135,043 151,064
Total interest-bearing
 2,136,185 2,041,103 2,327,566 2,336,222 2,453,402
Total Colorado
 3,734,807 3,767,233 4,196,760 4,799,113 4,963,581

New Mexico:
Demand
 853,571 912,218 997,364 1,141,958 1,296,410
Interest-bearing:
Transaction
 1,049,903 712,541 674,328 691,915 717,492
Savings
 97,753 102,729 111,771 112,430 113,056
Time
 217,535 179,548 137,875 133,625 142,856
Total interest-bearing
 1,365,191 994,818 923,974 937,970 973,404
Total New Mexico
 2,218,762 1,907,036 1,921,338 2,079,928 2,269,814

Arizona:
Demand
 522,142 592,144 780,051 844,327 903,296
Interest-bearing:
Transaction
 903,535 800,970 687,527 739,628 788,142
Savings
 12,340 14,489 16,993 16,496 18,258
Time
 36,689 31,248 27,755 24,846 26,704
Total interest-bearing
 952,564 846,707 732,275 780,970 833,104
Total Arizona
 1,474,706 1,438,851 1,512,326 1,625,297 1,736,400

Kansas/Missouri:
Demand
 351,236 363,534 393,321 436,259 479,459
Interest-bearing:
Transaction
 981,091 1,014,247 1,040,009 694,163 747,981
Savings
 14,331 16,316 18,292 20,678 19,375
Time
 22,437 16,176 13,061 12,963 13,258
Total interest-bearing
 1,017,859 1,046,739 1,071,362 727,804 780,614
Total Kansas/Missouri
 1,369,095 1,410,273 1,464,683 1,164,063 1,260,073

Arkansas:
Demand
 29,635 38,818 42,312 50,180 43,111
Interest-bearing:
Transaction
 57,381 43,301 71,158 56,181 123,273
Savings
 2,898 3,195 3,228 3,083 3,098
Time
 9,559 7,225 4,775 4,825 5,940
Total interest-bearing
 69,838 53,721 79,161 64,089 132,311
Total Arkansas
 99,473 92,539 121,473 114,269 175,422

TOTAL BOK FINANCIAL
 $33,652,552 $33,294,843 $32,580,747 $34,480,705 $36,415,915

NET INTEREST MARGIN TREND - UNAUDITED
BOK FINANCIAL CORPORATION

Three Months Ended
Sep. 30, 2023 June 30, 2023 Mar. 31, 2023 Dec. 31, 2022 Sep. 30, 2022
TAX-EQUIVALENT ASSETS YIELDS
Interest-bearing cash and cash equivalents
 5.43% 5.41% 4.28% 4.06% 1.87%
Trading securities
 4.76% 4.50% 4.52% 3.70% 2.72%
Investment securities, net of allowance
 1.43% 1.44% 1.46% 1.46% 1.42%
Available for sale securities
 3.11% 3.00% 2.87% 2.54% 2.21%
Fair value option securities
 4.61% 5.07% 5.17% 4.40% 2.98%
Restricted equity securities
 7.88% 7.31% 7.34% 5.70% 6.23%
Residential mortgage loans held for sale
 6.27% 5.85% 5.79% 5.56% 5.05%
Loans
 7.25% 7.03% 6.67% 5.99% 4.89%
Allowance for loan losses
Loans, net of allowance
 7.33% 7.10% 6.74% 6.06% 4.94%
Total tax-equivalent yield on earning assets
 5.49% 5.29% 5.06% 4.53% 3.71%
Interest-bearing deposits:
Interest-bearing transaction
 3.18% 2.60% 1.91% 1.28% 0.63%
Savings
 0.47% 0.21% 0.10% 0.08% 0.05%
Time
 3.96% 3.27% 1.95% 1.25% 0.93%
Total interest-bearing deposits
 3.17% 2.56% 1.83% 1.22% 0.63%
Funds purchased and repurchase agreements
 4.81% 4.58% 3.33% 2.05% 0.72%
Other borrowings
 5.48% 5.12% 4.73% 4.08% 2.33%
Subordinated debt
 7.02% 6.79% 6.40% 6.16% 5.07%
Total cost of interest-bearing liabilities
 3.81% 3.27% 2.43% 1.57% 0.76%
Tax-equivalent net interest revenue spread
 1.68% 2.02% 2.63% 2.96% 2.95%
Effect of noninterest-bearing funding sources and other
 1.01% 0.98% 0.82% 0.58% 0.29%
Tax-equivalent net interest margin
 2.69% 3.00% 3.45% 3.54% 3.24%

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

CREDIT QUALITY INDICATORS - UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands, except ratios)


 Three Months Ended

Sep. 30, 2023 June 30, 2023 Mar. 31, 2023 Dec. 31, 2022 Sep. 30, 2022
Nonperforming assets:




Nonaccruing loans:




Commercial:




Healthcare
 $41,836 $36,753 $37,247 $41,034 $41,438
Energy
 19,559 20,037 127 1,399 4,164
Services
 2,820 4,541 8,097 16,228 27,315
General business
 6,483 11,946 8,961 1,636 2,753
Total commercial
 70,698 73,277 54,432 60,297 75,670

Commercial real estate
 7,418 17,395 21,668 16,570 7,971

Loans to individuals:
Permanent mortgage
 30,954 29,973 29,693 29,791 30,066
Permanent mortgage guaranteed by U.S. government agencies
 10,436 11,473 14,302 15,005 16,957
Personal
 79 133 200 134 136
Total loans to individuals
 41,469 41,579 44,195 44,930 47,159

Total nonaccruing loans
 $119,585 $132,251 $120,295 $121,797 $130,800
Accruing renegotiated loans guaranteed by U.S. government agencies 1
 - - - 163,535 176,022
Real estate and other repossessed assets
 3,753 4,227 12,651 14,304 29,676
Total nonperforming assets
 $123,338 $136,478 $132,946 $299,636 $336,498
Total nonperforming assets excluding those guaranteed by U.S. government agencies
 $112,902 $125,005 $118,644 $121,096 $143,519

Accruing loans 90 days past due 2
 $64 $220 $76 $510 $120

Gross charge-offs
 $10,593 $8,049 $3,667 $17,807 $1,766
Recoveries
 (4,062) (1,346) (2,898) (2,301) (1,309)
Net charge-offs (recoveries)
 $6,531 $6,703 $769 $15,506 $457

Provision for loan losses
 $15,931 $19,957 $14,525 $9,442 $1,111
Provision for credit losses from off-balance sheet unfunded loan commitments
 (7,336) (3,003) 2,024 4,609 14,060
Provision for expected credit losses from mortgage banking activities
 (1,474) 78 (488) 1,003 (66)
Provision for credit losses related to held-to maturity (investment) securities portfolio
 (121) (32) (61) (54) (105)
Total provision for credit losses
 $7,000 $17,000 $16,000 $15,000 $15,000

Allowance for loan losses to period end loans
 1.15% 1.13% 1.10% 1.04% 1.11%
Combined allowance for loan losses and accrual for off-balance sheet credit risk from unfunded loan commitments to period end loans
 1.37% 1.39% 1.37% 1.31% 1.37%
Nonperforming assets to period end loans and repossessed assets
 0.52% 0.59% 0.58% 1.33% 1.54%
Net charge-offs (annualized) to average loans
 0.11% 0.12% 0.01% 0.28% 0.01%
Allowance for loan losses to nonaccruing loans 2
 249.31% 217.52% 235.36% 220.71% 212.37%
Combined allowance for loan losses and accrual for off-balance sheet credit risk from unfunded loan commitments to nonaccruing loans 2
 297.50% 267.15% 294.74% 277.76% 261.83%

1 The Company adopted FASB Accounting Standards Update No. 2022-02, Financial Instruments - Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures, which eliminates designation of these loans as troubled debt restructurings effective January 1, 2023.

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

SEGMENTS - UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands, except ratios)


 Three Months Ended 3Q23 vs 2Q23 3Q23 vs 3Q22

Sep. 30, 2023 June 30, 2023 Sep. 30, 2022 $ change % change $ change % change
Commercial Banking






Net interest revenue
 $254,464 $260,099 $208,065 $(5,635) (2.2)% $46,399 22.3%
Fees and commissions revenue
 57,858 59,704 58,147 (1,846) (3.1)% (289) (0.5)%
Combined net interest and fee revenue
 312,322 319,803 266,212 (7,481) (2.3)% 46,110 17.3%
Other operating expense
 81,751 77,479 75,490 4,272 5.5% 6,261 8.3%
Corporate expense allocations
 17,834 21,404 16,438 (3,570) (16.7)% 1,396 8.5%
Net income
 157,930 170,179 134,134 (12,249) (7.2)% 23,796 17.7%
Average assets
 28,849,597 28,170,869 28,890,429 678,728 2.4% (40,832) (0.1)%
Average loans
 19,645,259 19,158,984 17,904,779 486,275 2.5% 1,740,480 9.7%
Average deposits
 15,098,038 14,822,093 17,966,661 275,945 1.9% (2,868,623) (16.0)%
Consumer Banking
Net interest revenue
 $112,608 $113,391 $43,951 $(783) (0.7)% $68,657 156.2%
Fees and commissions revenue
 30,715 32,361 30,230 (1,646) (5.1)% 485 1.6%
Combined net interest and fee revenue
 143,323 145,752 74,181 (2,429) (1.7)% 69,142 93.2%
Other operating expense
 54,497 52,340 53,236 2,157 4.1% 1,261 2.4%
Corporate expense allocations
 11,920 12,318 10,792 (398) (3.2)% 1,128 10.5%
Net income
 58,009 60,332 2,970 (2,323) (3.9)% 55,039 1,853.2%
Average assets
 9,379,478 9,597,723 10,233,401 (218,245) (2.3)% (853,923) (8.3)%
Average loans
 1,812,606 1,762,568 1,686,498 50,038 2.8% 126,108 7.5%
Average deposits
 7,936,186 7,986,674 8,812,884 (50,488) (0.6)% (876,698) (9.9)%
Wealth Management
Net interest revenue
 $36,437 $49,352 $33,584 $(12,915) (26.2)% $2,853 8.5%
Fees and commissions revenue
 123,614 123,050 113,113 564 0.5% 10,501 9.3%
Combined net interest and fee revenue
 160,051 172,402 146,697 (12,351) (7.2)% 13,354 9.1%
Other operating expense
 89,367 84,859 79,151 4,508 5.3% 10,216 12.9%
Corporate expense allocations
 14,331 12,574 12,934 1,757 14.0% 1,397 10.8%
Net income
 43,029 57,317 41,808 (14,288) (24.9)% 1,221 2.9%
Average assets
 14,740,641 12,949,258 13,818,299 1,791,383 13.8% 922,342 6.7%
Average loans
 2,219,829 2,230,906 2,163,975 (11,077) (0.5)% 55,854 2.6%
Average deposits
 7,886,962 7,544,143 7,999,074 342,819 4.5% (112,112) (1.4)%
Fiduciary assets
 56,380,009 57,873,868 54,714,705 (1,493,859) (2.6)% 1,665,304 3.0%
Assets under management or administration
 99,004,179 103,618,940 95,401,638 (4,614,761) (4.5)% 3,602,541 3.8%

SOURCE: BOK Financial Corp



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FAQ

What was the net income for the third quarter of 2023?

The net income for the third quarter of 2023 was $134.5 million.

What were the highlights of the company's financial performance in Q3 2023?

The company reported solid earnings driven by a diverse business model and growth opportunities. They increased loans by almost 9% over the previous year, and core commercial and industrial loans were up 8% from last year.

Did the company repurchase any shares of common stock?

Yes, the company repurchased 700,500 shares of common stock.

How did net interest revenue and fees and commissions revenue change in Q3 2023?

Net interest revenue decreased to $300.9 million, and fees and commissions revenue decreased to $197.9 million.

What was the change in operating expenses in Q3 2023?

Operating expenses increased to $324.3 million.

Which segments contributed to the company's net income?

Commercial Banking, Consumer Banking, and Wealth Management segments all contributed to net income.

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BOK Financial Corp

NASDAQ:BOKF

BOKF Rankings

#1047 Ranked by Market Cap
#1386 Ranked by Dividends

BOKF Latest News

Oct 21, 2024
BOK Financial Corporation Announces Third Quarter 2024 Earnings
Oct 2, 2024
BOK Financial Corporation Announces Third Quarter 2024 Earnings Conference Call
Sep 4, 2024
David Stratton Promoted to Head of Regional Markets for BOK Financial
Jul 22, 2024
BOK Financial Corporation Announces Second Quarter 2024 Earnings
Jul 1, 2024
BOK Financial Corporation Announces Second Quarter 2024 Earnings Conference Call

BOKF Stock Data

7.24B
64.12M
60.21%
35.37%
0.46%
Banks - Regional
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United States of America
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