BOK Financial Corporation Reports Quarterly Earnings of $188 million or $2.74 Per Share in the Third Quarter

Rhea-AI Summary

BOK Financial Corporation (BOKF) reported a record net income of $188 million or $2.74 per share for Q3 2021, representing a significant increase from $166.4 million in Q2 2021. Revenue grew, driven by the Wealth Management segment, which saw a 14% increase to $153 million. Operating expenses maintained stability, growing slightly at 2%. Although total loans decreased by $1.1 billion to $20.3 billion, average deposits rose by $344 million to $37.8 billion. The common equity Tier 1 capital ratio reached 12.26%.

Positive

• Net income increased to $188 million, or $2.74 per share.
• Wealth Management revenue reached $153 million, a 14% increase year-over-year.
• Operating expenses grew at a controlled rate of 2%.
• Average deposits rose by $344 million to $37.8 billion.
• Common equity Tier 1 capital ratio improved to 12.26%.

Negative

• Total loans decreased by $1.1 billion to $20.3 billion.
• Loan growth is challenged, with line utilization at five-year lows.

TULSA, Okla., Oct. 20, 2021 (GLOBE NEWSWIRE) -- BOK Financial Corporation (NASD: BOKF) -

CEO Commentary

Steven G. Bradshaw, president and chief executive officer, stated, “The third quarter was BOKF’s second-consecutive record quarter with net income of $188 million or $2.74 per share. This quarter exhibits many of the benefits achieved from our strategy to generate revenue growth through long-term commitments and investments. Our diversified Wealth Management business, built over 30+ years, largely through organic growth, led the way with a record $153 million in total revenues, a 14% increase from their previous high set during the same quarter last year. Our alternative investment practice, which began in 2005 and provides equity and debt capital to growing businesses, experienced significant gains during the third quarter adding $31 million to pretax revenue. These types of long-term differentiators set us apart and demonstrate the force of a diversified business model.”

Bradshaw continued, “Equally impressive to our revenue generating opportunities this year has been our firm hold on expense management, which has grown at a rate just slightly above 2% over the last two trailing twelve month periods, despite significant technology and cyber-related investments.

“While loan growth continues to be a challenge, and our line utilization levels at five year lows, we believe that the inevitable return to normalized levels will result in significant earnings growth potential. Our strong results today leave us well-positioned to aggressively add customers throughout our loan portfolio.”

Third Quarter 2021 Financial Highlights

• Net income was $188.3 million or $2.74 per diluted share for the third quarter of 2021 and $166.4 million or $2.40 per diluted share for the second quarter of 2021.
• Net interest revenue totaled $280.2 million, consistent with the prior quarter. Net interest margin was 2.66 percent compared to 2.60 percent in the second quarter of 2021.
• Operating revenue totaled $229.8 million, an increase of $38.4 million. Growth in much of our fee-based businesses, led by brokerage and trading and mortgage banking revenues, was partially offset by lower operating revenues from repossessed assets related to oil and gas properties sold during the quarter. In addition, we recognized a $31.1 million pre-tax gain on the sale of an alternative investment. This gain was partially offset by losses on the extinguishment of subordinated debt and sale of repossessed assets.
• Operating expense totaled $291.3 million, consistent with the prior quarter, as a $3.8 million increase in personnel expense was offset by a $3.7 million decrease in non-personnel expense, primarily due to a reduction of operating expenses related to oil and gas properties sold during the quarter.
• Period-end loans decreased $1.1 billion to $20.3 billion at September 30, 2021. Period-end Paycheck Protection Program ("PPP") loans decreased $586 million to $536 million. The remaining decrease was primarily due to paydowns of commercial energy loans and commercial real estate loans. Average loans were $20.8 billion, a $1.3 billion decrease compared to the second quarter of 2021.
• Continued improvement in credit quality metrics and lower loan balances coupled with strength in commodity prices and a continued optimistic outlook for growth in gross domestic product and the labor markets resulted in a $23.0 million negative provision for expected credit losses in the third quarter of 2021. A $35.0 million negative provision for expected credit losses was recorded in the prior quarter. The combined allowance for credit losses totaled $306 million or 1.54 percent of outstanding loans, excluding PPP loans, at September 30, 2021. The combined allowance for credit losses was $336 million or 1.66 percent of outstanding loans, excluding PPP loans, at June 30, 2021.
• Average deposits increased $344 million to $37.8 billion and period-end deposits increased $1.1 billion to $38.5 billion, largely due to growth in commercial balances. Average demand deposits grew by $481 million and average interest bearing deposits decreased by $137 million.
• The company's common equity Tier 1 capital ratio was 12.26 percent at September 30, 2021. In addition, the company's Tier 1 capital ratio was 12.29 percent, total capital ratio was 13.38 percent, and leverage ratio was 8.77 percent at September 30, 2021. At June 30, 2021, the company's common equity Tier 1 capital ratio was 11.95 percent, Tier 1 capital ratio was 12.01 percent, total capital ratio was 13.61 percent, and leverage ratio was 8.58 percent.
• The company repurchased 478,141 shares of common stock at an average price of $85.00 a share in the third quarter of 2021.
• On August 23, 2021, the company redeemed the subordinated debt issued in June of 2016 at the interest rate of 5.375 percent using existing capital, saving approximately $8.0 million per year in interest payments. The repayment resulted in a realized loss on extinguishment of debt of $5.2 million.
• Commercial Banking contributed $102.7 million to net income in the third quarter of 2021, an increase of $30.1 million compared to the second quarter of 2021. The sale of an alternative investment resulted in a $31.1 million pre-tax gain, net of non-controlling interest. Combined net interest revenue and fee revenue decreased $3.7 million, largely due to a decrease of $6.0 million in production revenue from repossessed oil and gas properties, which was partially offset by a decrease in expenses on the same properties. In addition, favorable yields on deposits sold to our Funds Management unit dampened the reduction of total revenue. Average Commercial Banking loans decreased $393 million due to purposeful deleveraging by our customers. Average Commercial Banking deposits grew 5 percent to $17.9 billion in the third quarter of 2021.
• Consumer Banking contributed $12.4 million to net income in the third quarter of 2021, an increase of $10.7 million compared to the prior quarter. Combined net interest revenue and fee revenue increased $9.0 million. Net interest revenue increased $2.3 million, mainly due to favorable yields on deposits sold to our Funds Management unit. Fees and commissions revenue increased $6.7 million, largely due to mortgage production revenue. Lower mortgage banking costs largely drove a $3.0 million decrease in operating expense. Average Consumer Banking deposits were consistent with the prior quarter.
• Wealth Management contributed a record $41.4 million to net income in the third quarter of 2021, an increase of $10.3 million compared to the prior quarter. Our diverse set of investment-focused businesses including fixed income trading, private wealth, institutional wealth, financial risk management, and multiple fiduciary businesses combined to provide total net interest and fee revenues of $153.2 million, an increase of $22.0 million over the second quarter of 2021. Revenue primarily from agency residential mortgage trading activity increased $15.4 million to $77.3 million due to higher margin market opportunities. Operating expense increased $8.0 million, primarily due to incentive compensation costs related to increased trading activity. Average Wealth Management deposits decreased 6 percent to $9.1 billion in the third quarter of 2021. Assets under management were $98.8 billion, an increase of $2.2 billion compared to the prior quarter.

Net Interest Revenue

Net interest revenue was $280.2 million for the third quarter of 2021, largely unchanged compared to the second quarter of 2021. Net interest margin was 2.66 percent compared to 2.60 percent in the prior quarter.

Average earning assets decreased $892 million compared to the second quarter of 2021. Average loan balances decreased $1.3 billion, largely due to paydowns of PPP loans. Available for sale securities increased $203 million. Average trading securities grew by $187 million. Other borrowings decreased $1.1 billion while funds purchased and repurchase agreements decreased $342 million.

The yield on average earning assets was 2.78 percent, a 3 basis point increase from the prior quarter. The loan portfolio yield increased 14 basis points to 3.68 percent, primarily due to non-use fees related to lower credit line utilization. The yield on the available for sale securities portfolio decreased 5 basis points to 1.80 percent.

Funding costs were 0.19 percent, down 2 basis points. The cost of interest-bearing deposits decreased 1 basis point to 0.13 percent. The cost of other borrowed funds increased 2 basis points to 0.30 percent. The cost of subordinated debentures decreased 24 basis points due to the redemption of $150 million in the third quarter. The benefit to net interest margin from assets funded by non-interest liabilities was 7 basis points for the third quarter of 2021, compared to 6 basis points for the prior quarter.

Operating Revenue

Growing $21.0 million over the prior quarter, fees and commissions revenue totaled $190.4 million for the third quarter of 2021. Brokerage and trading revenue increased $18.5 million to $47.9 million. Higher margin market opportunities led to an $11.1 million increase in trading revenue. Customer hedging revenue increased $5.1 million, primarily attributed to energy customers. Investment banking revenue increased $1.9 million, largely due to the timing of financial advisory fees.

Mortgage banking revenue increased $5.1 million compared to the prior quarter. While mortgage production volume decreased $28 million to $615 million, production revenue as a percentage of production volume, which includes unrealized gains and losses on our mortgage commitment pipeline and related hedges, increased to 2.50 percent. An increase in consumer activity following the pandemic shut downs resulted in a $1.6 million increase in deposit service charges.

Other gains and losses, net increased $14.6 million over the prior quarter. The sale of an alternative investment resulted in a $31.1 million gain, net of non-controlling interest, which was partially offset by a $5.2 million loss on the extinguishment of subordinated debentures and a $3.9 million loss on the sale of a repossessed oil and gas asset. The prior quarter included a $7.4 million gain on the sale of a repossessed asset.

Other revenue decreased $4.3 million as a result of lower operating revenue from repossessed oil and gas assets due to the sale of a property, which was largely offset by a reduction of expenses on the same properties.

Operating Expense

Total operating expense remained consistent with the prior quarter at $291.3 million with a $3.8 million increase in personnel expense offset by a $3.7 million decrease in non-personnel expense.

Cash based incentive compensation increased $8.8 million, primarily in relation to increased trading revenue. Deferred compensation expense, which is largely offset by a decrease in the value of related investments included in Other gains (losses), net, decreased $2.4 million. Employee benefits expense decreased $3.3 million due to reduced payroll taxes and employee healthcare costs.

Other expense decreased $6.8 million as a result of lower operating expenses on repossessed assets. Mortgage banking costs decreased $2.2 million due to a decrease in prepayments. These decreases were partially offset by a $2.2 million increase in business promotion costs, a $2.0 million increase in data processing and communications expense and a $1.8 million increase in occupancy and equipment expense.

Loans, Deposits and Capital

Loans

Outstanding loans were $20.3 billion at September 30, 2021, a $1.1 billion decrease compared to June 30, 2021, led by lower PPP loan balances and to a lesser extent, energy and commercial real estate loans.

Outstanding commercial loan balances decreased $298 million compared to June 30, 2021, primarily due to lower energy loan balances. Although the primary source of repayment of our commercial loan portfolio is the on-going cash flow from operations of the customer's business, loans are generally governed by a borrowing base and secured by the customer’s assets.

Energy loan balances decreased $197 million to $2.8 billion or 14 percent of total loans. While commodity prices have continued to improve and stabilize, sourcing new loans sufficient to offset paydowns remains a challenge. 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 67 percent of committed production loans are secured by properties primarily producing oil. The remaining 33 percent is secured by properties primarily producing natural gas. Unfunded energy loan commitments were $2.8 billion at September 30, 2021, an increase of $109 million over June 30, 2021.

Services loan balances decreased $66 million to $3.3 billion or 16 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.

Healthcare sector loan balances decreased $34 million compared to the prior quarter, totaling $3.3 billion or 16 percent of total loans. Our healthcare sector loans primarily consist of $2.6 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 that serves to help diversify risks specific to a single facility.

Commercial real estate loan balances decreased $130 million compared to June 30, 2021 and represent 20 percent of total loans at September 30, 2021, largely due to refinancing in the long term, non-recourse markets. Multifamily residential loans, decreased $89 million to $876 million at September 30, 2021. Loans secured by office facilities decreased $43 million to $1.0 billion. Loans secured by other commercial real estate properties decreased $35 million to $435 million. Loans secured by industrial facilities increased $66 million to $890 million.

PPP loan balances decreased $586 million to $536 million or 3 percent of total loans.

Loans to individuals decreased $55 million and represent 17 percent of total loans at September 30, 2021. Residential mortgage loans decreased $62 million, largely due to the re-sale of loans previously sold into GNMA mortgage pools that the Company repurchased when certain defined delinquency criteria were met. Many loans repurchased during the pandemic have since been cured and meet the re-sale qualifications. Personal loans were up $7.1 million.

Deposits

Period-end deposits totaled $38.5 billion at September 30, 2021, a $1.1 billion increase compared to June 30, 2021. Demand deposit account balances grew by $710 million and interest-bearing transaction account balances increased by $474 million. Average deposits were $37.8 billion at September 30, 2021, a $344 million increase compared to June 30, 2021. Demand deposit account balances increased $481 million primarily from deposits attributed to the Commercial Banking segment while interest-bearing deposits decreased $137 million.

Capital

The company's common equity Tier 1 capital ratio was 12.26 percent at September 30, 2021. In addition, the company's Tier 1 capital ratio was 12.29 percent, total capital ratio was 13.38 percent, and leverage ratio was 8.77 percent at September 30, 2021. We have 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, which added 20 basis points to the company's common equity tier 1 capital ratio at September 30. At June 30, 2021, the company's common equity Tier 1 capital ratio was 11.95 percent, Tier 1 capital ratio was 12.01 percent, total capital ratio was 13.61 percent, and leverage ratio was 8.58 percent.

The company's tangible common equity ratio, a non-GAAP measure, was 9.28 percent at September 30, 2021 and 9.09 percent at June 30, 2021. 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.

The company repurchased 478,141 shares of common stock at an average price of $85.00 a share in the third quarter of 2021. We view share buybacks opportunistically, but within the context of maintaining our strong capital position.

Credit Quality

Expected credit losses on assets carried at amortized cost are recognized over their expected lives based on models that measure the probability of default and loss given default over a 12-month reasonable and supportable forecast period. Our models incorporate base case, downside and upside macroeconomic variables such as real gross domestic product ("GDP") growth, civilian unemployment rate and West Texas Intermediate ("WTI") oil prices on a probability weighted basis.

We recorded a $23.0 million negative provision for credit losses in the third quarter of 2021. Changes in our reasonable and supportable forecasts of macroeconomic variables, primarily due to continued strength in commodity prices and a continued optimistic outlook for economic growth in GDP and labor markets resulted in a $12.3 million decrease in the allowance for credit losses related to lending activities. Changes in loan portfolio characteristics, primarily related to improving credit quality metrics and lower loan balances resulted in a $10.1 million decrease in the allowance for credit losses related to lending activities.

Our base case reasonable and supportable forecast assumes that the COVID-19 pandemic continues to improve from the Delta variant as global virus immunity continues to be more widespread and vaccines prove to be effective against severe virus outcomes as well as new virus strains. Elevated consumer consumption and the need for inventory restocking is expected to result in GDP growth above historical averages throughout mid-year 2022, but begins to moderate thereafter. We expect a 4.1 percent increase in GDP over the next twelve months. We expect labor force participants will continue to re-enter the job market to help meet record job openings. This increase in employment helps maintain household income above its pre-pandemic trend and prevents a sharp drop-off in spending. Our forecasted civilian unemployment rate is 4.9 percent for the fourth quarter of 2021, improving to 4.5 percent by the third quarter of 2022. WTI oil prices are projected to generally follow the NYMEX forward curve that existed at the end of September 2021, averaging $68.38 per barrel over the next twelve months.

The probability weighting of our base case reasonable and supportable forecast decreased to 65 percent in the third quarter of 2021 compared to 70 percent in the second quarter of 2021 as the level of uncertainty in the current economic outlook worsened slightly. Our downside case, probability weighted at 25 percent, assumes additional waves and hotspots emerge in areas of the country with lower vaccination rates stemming from the impact of new virus strains, such as the current Delta variant, as the U.S. enters the fall and winter months. This results in a relatively mild recession with conditions beginning to improve in the summer of 2022.

The allowance for loan losses totaled $277 million or 1.36 percent of outstanding loans and 208 percent of nonaccruing loans at September 30, 2021, excluding residential mortgage loans guaranteed by U.S. government agencies. The combined allowance for loan losses and accrual for off-balance sheet credit risk from unfunded loan commitments was $306 million or 1.50 percent of outstanding loans and 230 percent of nonaccruing loans at September 30, 2021. Excluding PPP loans, the allowance for loan losses was 1.40 percent of outstanding loans and the combined allowance for loan losses and accrual for off-balance sheet credit risk from unfunded loan commitments was 1.54 percent.

At June 30, 2021, the allowance for loan losses was $312 million or 1.46 percent of outstanding loans and 183 percent of nonaccruing loans, excluding loans guaranteed by U.S. government agencies. The combined allowance for loan losses and accrual for off-balance sheet credit risk from unfunded loan commitments was $336 million or 1.57 percent of outstanding loans and 197 percent of nonaccruing loans.

Nonperforming assets totaled $349 million or 1.71 percent of outstanding loans and repossessed assets at September 30, 2021, down from $408 million or 1.90 percent at June 30, 2021. Nonperforming assets that are not guaranteed by U.S. government agencies totaled $162 million or 0.83 percent of outstanding loans and repossessed assets at September 30, 2021, compared to $228 million or 1.14 percent at June 30, 2021. The decrease in nonperforming assets was primarily related to a decrease in nonaccruing energy loans and sales of energy-related repossessed assets during the third quarter of 2021.

Nonaccruing loans were $142 million or 0.72 percent of outstanding loans, excluding PPP loans, at September 30, 2021. Nonaccruing commercial loans totaled $81 million or 0.66 percent of outstanding commercial loans. Nonaccruing commercial real estate loans totaled $21 million or 0.52 percent of outstanding commercial real estate loans. Nonaccruing loans to individuals totaled $40 million or 1.14 percent of outstanding loans to individuals.

Nonaccruing loans decreased $38 million compared to June 30, 2021, primarily due to a decrease in nonaccruing energy loans. New nonaccruing loans identified in the third quarter totaled $22 million, offset by $42 million in payments received and $10 million in charge-offs.

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 $333 million at September 30, 2021, down significantly from $384 million at June 30. Potential problem energy and services loans decreased compared to the prior quarter, partially offset by an increase in potential problem commercial real estate loans.

Net charge-offs were $7.8 million or 0.16 percent of average loans on an annualized basis for the third quarter of 2021, excluding PPP loans. Net charge-offs were 0.26 percent of average loans over the last four quarters. Net charge-offs were $15.4 million or 0.30 percent of average loans on an annualized basis for the second quarter of 2021, excluding PPP loans. Gross charge-offs were $9.6 million for the third quarter compared to $18.3 million for the previous quarter. Recoveries totaled $1.8 million for the third quarter of 2021 and $2.9 million for the second quarter of 2021.

Securities and Derivatives

The fair value of the available for sale securities portfolio totaled $13.3 billion at September 30, 2021, a $24 million increase compared to June 30, 2021. At September 30, 2021, the available for sale securities portfolio consisted primarily of $8.2 billion of residential mortgage-backed securities fully backed by U.S. government agencies and $4.7 billion of commercial mortgage-backed securities fully backed by U.S. government agencies. At September 30, 2021, the available for sale securities portfolio had a net unrealized gain of $221 million compared to $297 million at June 30, 2021.

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 $9.4 million to $51 million at September 30, 2021.

The net economic benefit of the changes in the fair value of mortgage servicing rights and related economic hedges was $7.3 million during the third quarter of 2021, including a $12.9 million increase in the fair value of mortgage servicing rights, a $5.9 million decrease in the fair value of securities and derivative contracts held as an economic hedge, and $286 thousand of related net interest revenue.

Conference Call and Webcast

The company will hold a conference call at 9 a.m. Central time on Wednesday, October 20, 2021 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 # 13723814.

About BOK Financial Corporation

BOK Financial Corporation is a $47 billion regional financial services company headquartered in Tulsa, Oklahoma with $99 billion in assets under management and 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 and Connecticut. 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, 2021 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, the economy generally and the expected or potential impact of the novel coronavirus (COVID-19) pandemic, and the related responses of the government, consumers, and others, on our business, financial condition and results of operations. 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, consumer or business responses to, and ability to treat or prevent further outbreak of the COVID-19 pandemic, 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)

	Sept. 30, 2021				June 30, 2021
ASSETS
Cash and due from banks	$	729,285			$	678,998
Interest-bearing cash and cash equivalents	1,162,477				580,457
Trading securities	5,554,040				5,699,070
Investment securities, net of allowance	215,592				220,832
Available for sale securities	13,342,113				13,317,922
Fair value option securities	51,019				60,432
Restricted equity securities	77,542				134,885
Residential mortgage loans held for sale	176,813				200,842
Loans:
Commercial	12,175,140				12,472,907
Commercial real estate	4,116,892				4,246,992
Paycheck protection program	536,052				1,121,583
Loans to individuals	3,519,852				3,574,967
Total loans	20,347,936				21,416,449
Allowance for loan losses	(276,680		)		(311,890		)
Loans, net of allowance	20,071,256				21,104,559
Premises and equipment, net	558,126				556,400
Receivables	171,505				195,763
Goodwill	1,044,749				1,048,091
Intangible assets, net	96,186				105,694
Mortgage servicing rights	133,308				117,629
Real estate and other repossessed assets, net	28,770				57,337
Derivative contracts, net	1,901,136				1,701,443
Cash surrender value of bank-owned life insurance	403,369				401,163
Receivable on unsettled securities sales	215,755				70,954
Other assets	990,368				901,904
TOTAL ASSETS	$	46,923,409			$	47,154,375
LIABILITIES AND EQUITY
Deposits:
Demand	$	14,090,229			$	13,380,409
Interest-bearing transaction	21,753,110				21,278,719
Savings	900,497				875,456
Time	1,780,715				1,905,349
Total deposits	38,524,551				37,439,933
Funds purchased and repurchase agreements	843,273				730,183
Other borrowings	37,426				1,546,231
Subordinated debentures	131,220				276,043
Accrued interest, taxes and expense	220,266				199,014
Due on unsettled securities purchases	614,598				576,536
Derivative contracts, net	739,641				612,261
Other liabilities	415,986				419,623
TOTAL LIABILITIES	41,526,961				41,799,824
Shareholders' equity:
Capital, surplus and retained earnings	5,219,801				5,106,209
Accumulated other comprehensive gain	169,172				226,768
TOTAL SHAREHOLDERS' EQUITY	5,388,973				5,332,977
Non-controlling interests	7,475				21,574
TOTAL EQUITY	5,396,448				5,354,551
TOTAL LIABILITIES AND EQUITY	$	46,923,409			$	47,154,375

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

	Three Months Ended
	Sept. 30, 2021				June 30, 2021				Mar. 31, 2021				Dec. 31, 2020				Sept. 30, 2020
ASSETS
Interest-bearing cash and cash equivalents	$	682,788			$	659,312			$	711,047			$	643,926			$	553,070
Trading securities	7,617,236				7,430,217				6,963,617				6,888,189				1,834,160
Investment securities, net of allowance	218,117				221,401				237,313				251,863				258,965
Available for sale securities	13,446,095				13,243,542				13,433,767				12,949,702				12,580,850
Fair value option securities	56,307				64,864				104,662				122,329				387,784
Restricted equity securities	245,485				208,692				189,921				280,428				144,415
Residential mortgage loans held for sale	167,620				218,200				207,013				229,631				213,125
Loans:
Commercial	12,231,230				12,402,925				12,908,461				13,113,449				13,772,217
Commercial real estate	4,218,190				4,395,848				4,547,945				4,788,393				4,754,269
Paycheck protection program	792,728				1,668,047				1,741,534				1,928,665				2,092,933
Loans to individuals	3,606,460				3,700,269				3,559,067				3,617,011				3,491,044
Total loans	20,848,608				22,167,089				22,757,007				23,447,518				24,110,463
Allowance for loan losses	(306,125		)		(345,269		)		(382,734		)		(414,225		)		(441,831		)
Loans, net of allowance	20,542,483				21,821,820				22,374,273				23,033,293				23,668,632
Total earning assets	42,976,131				43,868,048				44,221,613				44,399,361				39,641,001
Cash and due from banks	766,688				763,393				760,691				742,432				723,826
Derivative contracts, net	1,501,736				1,022,137				873,712				553,779				581,839
Cash surrender value of bank-owned life insurance	401,926				401,760				399,830				397,354				394,680
Receivable on unsettled securities sales	632,539				716,700				735,482				1,094,198				4,563,301
Other assets	3,220,129				3,424,884				3,319,305				3,200,040				3,027,108
TOTAL ASSETS	$	49,499,149			$	50,196,922			$	50,310,633			$	50,387,164			$	48,931,755
LIABILITIES AND EQUITY
Deposits:
Demand	$	13,670,656			$	13,189,954			$	12,312,629			$	12,136,071			$	11,929,694
Interest-bearing transaction	21,435,736				21,491,145				21,433,406				20,718,390				19,752,106
Savings	888,011				872,618				789,656				737,360				707,121
Time	1,839,983				1,936,510				1,986,425				1,930,808				2,251,012
Total deposits	37,834,386				37,490,227				36,522,116				35,522,629				34,639,933
Funds purchased and repurchase agreements	1,448,800				1,790,490				2,830,378				2,153,254				2,782,150
Other borrowings	2,546,083				3,608,369				3,392,346				5,193,656				3,382,688
Subordinated debentures	214,654				276,034				276,015				275,998				275,980
Derivative contracts, net	434,334				366,202				428,488				399,476				458,390
Due on unsettled securities purchases	957,538				701,495				915,410				957,642				1,516,880
Other liabilities	619,913				634,460				671,715				656,147				712,674
TOTAL LIABILITIES	44,055,708				44,867,277				45,036,468				45,158,802				43,768,695
Total equity	5,443,441				5,329,645				5,274,165				5,228,362				5,163,060
TOTAL LIABILITIES AND EQUITY	$	49,499,149			$	50,196,922			$	50,310,633			$	50,387,164			$	48,931,755

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

	Three Months Ended								Nine Months Ended
	September 30,								September 30,
	2021				2020				2021				2020
Interest revenue	$	293,463			$	294,659			$	887,595			$	949,980
Interest expense	13,236				22,909				46,639				138,766
Net interest revenue	280,227				271,750				840,956				811,214
Provision for credit losses	(23,000		)		—				(83,000		)		229,092
Net interest revenue after provision for credit losses	303,227				271,750				923,956				582,122
Other operating revenue:
Brokerage and trading revenue	47,930				69,526				98,120				182,327
Transaction card revenue	24,632				23,465				71,985				68,286
Fiduciary and asset management revenue	45,248				39,931				131,402				125,646
Deposit service charges and fees	27,429				24,286				77,499				72,462
Mortgage banking revenue	26,286				51,959				84,618				143,062
Other revenue	18,896				13,698				58,364				37,486
Total fees and commissions	190,421				222,865				521,988				629,269
Other gains (losses), net	31,091				2,044				57,661				(1,347		)
Gain (loss) on derivatives, net	(5,760		)		2,354				(14,590		)		42,659
Gain (loss) on fair value option securities, net	(120		)		(754		)		(3,657		)		53,180
Change in fair value of mortgage servicing rights	12,945				3,441				33,778				(85,800		)
Gain (loss) on available for sale securities, net	1,255				(12		)		3,152				5,571
Total other operating revenue	229,832				229,938				598,332				643,532
Other operating expense:
Personnel	175,863				179,860				520,908				512,276
Business promotion	4,939				2,633				9,837				10,783
Charitable contributions to BOKF Foundation	—				—				4,000				3,000
Professional fees and services	12,436				14,074				36,777				39,183
Net occupancy and equipment	28,395				28,111				81,690				84,847
Insurance	3,712				5,848				11,992				15,984
Data processing and communications	38,371				34,751				112,256				100,436
Printing, postage and supplies	3,558				3,482				11,283				11,256
Amortization of intangible assets	4,488				5,071				13,873				15,355
Mortgage banking costs	8,962				15,803				34,031				41,946
Other expense	10,553				7,411				41,566				26,571
Total other operating expense	291,277				297,044				878,213				861,637
Net income before taxes	241,782				204,644				644,075				364,017
Federal and state income taxes	54,061				50,552				144,939				83,655
Net income	187,721				154,092				499,136				280,362
Net income (loss) attributable to non-controlling interests	(601		)		58				(1,667		)		(444		)
Net income attributable to BOK Financial Corporation shareholders	$	188,322			$	154,034			$	500,803			$	280,806
Average shares outstanding:
Basic	68,359,125				69,877,866				68,768,044				69,958,944
Diluted	68,360,871				69,879,290				68,770,663				69,962,053
Net income per share:
Basic	$	2.74			$	2.19			$	7.23			$	3.99
Diluted	$	2.74			$	2.19			$	7.23			$	3.99

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

	Three Months Ended
	Sept. 30, 2021				June 30, 2021				Mar. 31, 2021				Dec. 31, 2020				Sept. 30, 2020
Capital:
Period-end shareholders' equity	$	5,388,973			$	5,332,977			$	5,239,462			$	5,266,266			$	5,218,787
Risk weighted assets	$	33,916,456			$	33,824,860			$	32,623,108			$	32,492,277			$	31,529,826
Risk-based capital ratios:
Common equity tier 1	12.26		%		11.95		%		12.14		%		11.95		%		12.07		%
Tier 1	12.29		%		12.01		%		12.21		%		11.95		%		12.07		%
Total capital	13.38		%		13.61		%		13.98		%		13.82		%		14.05		%
Leverage ratio	8.77		%		8.58		%		8.42		%		8.28		%		8.39		%
Tangible common equity ratio1	9.28		%		9.09		%		8.82		%		9.02		%		9.02		%
Common stock:
Book value per share	$	78.56			$	77.20			$	75.33			$	75.62			$	74.23
Tangible book value per share	$	61.93			$	60.50			$	58.67			$	58.94			$	57.64
Market value per share:
High	$	92.97			$	93.00			$	98.95			$	73.07			$	62.86
Low	$	77.20			$	83.59			$	67.57			$	50.09			$	48.41
Cash dividends paid	$	35,725			$	35,925			$	36,038			$	36,219			$	35,799
Dividend payout ratio	18.97		%		21.59		%		24.67		%		23.48		%		23.24		%
Shares outstanding, net	68,596,764				69,078,458				69,557,873				69,637,600				70,305,833
Stock buy-back program:
Shares repurchased	478,141				492,994				260,000				665,100				—
Amount	$	40,644			$	43,797			$	20,071			$	42,450			$	—
Average price per share	$	85.00			$	88.84			$	77.20			$	63.82			$	—
Performance ratios (quarter annualized):
Return on average assets	1.51		%		1.33		%		1.18		%		1.22		%		1.25		%
Return on average equity	13.78		%		12.58		%		11.28		%		11.75		%		11.89		%
Net interest margin	2.66		%		2.60		%		2.62		%		2.72		%		2.81		%
Efficiency ratio	61.23		%		64.20		%		66.26		%		62.77		%		59.57		%
Reconciliation of non-GAAP measures:
1 Tangible common equity ratio:
Total shareholders' equity	$	5,388,973			$	5,332,977			$	5,239,462			$	5,266,266			$	5,218,787
Less: Goodwill and intangible assets, net	1,140,935				1,153,785				1,158,676				1,161,527				1,166,615
Tangible common equity	$	4,248,038			$	4,179,192			$	4,080,786			$	4,104,739			$	4,052,172
Total assets	$	46,923,409			$	47,154,375			$	47,442,513			$	46,671,088			$	46,067,224
Less: Goodwill and intangible assets, net	1,140,935				1,153,785				1,158,676				1,161,527				1,166,615
Tangible assets	$	45,782,474			$	46,000,590			$	46,283,837			$	45,509,561			$	44,900,609
Tangible common equity ratio	9.28		%		9.09		%		8.82		%		9.02		%		9.02		%

	Three Months Ended
	Sept. 30, 2021					June 30, 2021					Mar. 31, 2021					Dec. 31, 2020					Sept. 30, 2020
Pre-provision net revenue:
Net income before taxes	$	241,782				$	215,603				$	186,690				$	199,847				$	204,644
Provision for expected credit losses	(23,000		)			(35,000		)			(25,000		)			(6,500		)			—
Net income (loss) attributable to non-controlling interests	(601		)			686					(1,752		)			485					58
Pre-provision net revenue	$	219,383				$	179,917				$	163,442				$	192,862				$	204,586
Other data:
Tax equivalent interest	$	2,217				$	2,320				$	2,301				$	2,414				$	2,457
Net unrealized gain on available for sale securities	$	221,487				$	297,267				$	290,217				$	440,814				$	480,563
Mortgage banking:
Mortgage production revenue	$	15,403				$	10,004				$	25,287				$	26,662				$	38,431
Mortgage loans funded for sale	$	652,336				$	754,893				$	843,053				$	998,435				$	1,032,472
Add: current period-end outstanding commitments	239,066					276,154					387,465					380,637					560,493
Less: prior period end outstanding commitments	276,154					387,465					380,637					560,493					546,304
Total mortgage production volume	$	615,248				$	643,582				$	849,881				$	818,579				$	1,046,661
Mortgage loan refinances to mortgage loans funded for sale	48			%		48			%		65			%		58			%		54			%
Realized margin on funded mortgage loans	2.48			%		2.75			%		3.10			%		3.78			%		3.52			%
Production revenue as a percentage of production volume	2.50			%		1.55			%		2.98			%		3.26			%		3.67			%
Mortgage servicing revenue	$	10,883				$	11,215				$	11,826				$	12,636				$	13,528
Average outstanding principal balance of mortgage loans serviced for others	14,899,306					15,065,173					15,723,231					16,518,208					17,434,215
Average mortgage servicing revenue rates	0.29			%		0.30			%		0.31			%		0.30			%		0.31			%
Gain (loss) on mortgage servicing rights, net of economic hedge:
Gain (loss) on mortgage hedge derivative contracts, net	$	(5,829	)			$	18,764				$	(27,705	)			$	(385	)			$	2,295
Gain (loss) on fair value option securities, net	(120		)			(1,627		)			(1,910		)			68					(754		)
Gain (loss) on economic hedge of mortgage servicing rights	(5,949		)			17,137					(29,615		)			(317		)			1,541
Gain (loss) on changes in fair value of mortgage servicing rights	12,945					(13,041		)			33,874					6,276					3,441
Gain on changes in fair value of mortgage servicing rights, net of economic hedges, included in other operating revenue	6,996					4,096					4,259					5,959					4,982
Net interest revenue on fair value option securities2	286					341					393					550					1,565
Total economic benefit of changes in the fair value of mortgage servicing rights, net of economic hedges	$	7,282				$	4,437				$	4,652				$	6,509				$	6,547

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

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

	Three Months Ended
	Sept. 30, 2021				June 30, 2021				Mar. 31, 2021				Dec. 31, 2020				Sept. 30, 2020
Interest revenue	$	293,463			$	295,893			$	298,239			$	319,020			$	294,659
Interest expense	13,236				15,584				17,819				21,790				22,909
Net interest revenue	280,227				280,309				280,420				297,230				271,750
Provision for credit losses	(23,000		)		(35,000		)		(25,000		)		(6,500		)		—
Net interest revenue after provision for credit losses	303,227				315,309				305,420				303,730				271,750
Other operating revenue:
Brokerage and trading revenue	47,930				29,408				20,782				39,506				69,526
Transaction card revenue	24,632				24,923				22,430				21,896				23,465
Fiduciary and asset management revenue	45,248				44,832				41,322				41,799				39,931
Deposit service charges and fees	27,429				25,861				24,209				24,343				24,286
Mortgage banking revenue	26,286				21,219				37,113				39,298				51,959
Other revenue	18,896				23,172				16,296				14,209				13,698
Total fees and commissions	190,421				169,415				162,152				181,051				222,865
Other gains, net	31,091				16,449				10,121				7,394				2,044
Gain (loss) on derivatives, net	(5,760		)		18,820				(27,650		)		(339		)		2,354
Gain (loss) on fair value option securities, net	(120		)		(1,627		)		(1,910		)		68				(754		)
Change in fair value of mortgage servicing rights	12,945				(13,041		)		33,874				6,276				3,441
Gain (loss) on available for sale securities, net	1,255				1,430				467				4,339				(12		)
Total other operating revenue	229,832				191,446				177,054				198,789				229,938
Other operating expense:
Personnel	175,863				172,035				173,010				176,198				179,860
Business promotion	4,939				2,744				2,154				3,728				2,633
Charitable contributions to BOKF Foundation	—				—				4,000				6,000				—
Professional fees and services	12,436				12,361				11,980				14,254				14,074
Net occupancy and equipment	28,395				26,633				26,662				27,875				28,111
Insurance	3,712				3,660				4,620				4,006				5,848
Data processing and communications	38,371				36,418				37,467				35,061				34,751
Printing, postage and supplies	3,558				4,285				3,440				3,805				3,482
Amortization of intangible assets	4,488				4,578				4,807				5,088				5,071
Mortgage banking costs	8,962				11,126				13,943				14,765				15,803
Other expense	10,553				17,312				13,701				11,892				7,411
Total other operating expense	291,277				291,152				295,784				302,672				297,044
Net income before taxes	241,782				215,603				186,690				199,847				204,644
Federal and state income taxes	54,061				48,496				42,382				45,138				50,552
Net income	187,721				167,107				144,308				154,709				154,092
Net income (loss) attributable to non-controlling interests	(601		)		686				(1,752		)		485				58
Net income attributable to BOK Financial Corporation shareholders	$	188,322			$	166,421			$	146,060			$	154,224			$	154,034
Average shares outstanding:
Basic	68,359,125				68,815,666				69,137,375				69,489,597				69,877,866
Diluted	68,360,871				68,817,442				69,141,710				69,493,050				69,879,290
Net income per share:
Basic	$	2.74			$	2.40			$	2.10			$	2.21			$	2.19
Diluted	$	2.74			$	2.40			$	2.10			$	2.21			$	2.19

LOANS TREND -- UNAUDITED
BOK FINANCIAL CORPORATION
(In thousands)

		Sept. 30, 2021				June 30, 2021				Mar. 31, 2021				Dec. 31, 2020				Sept. 30, 2020
Commercial:
Healthcare		$	3,347,641			$	3,381,261			$	3,290,758			$	3,305,990			$	3,325,790
Services		3,323,422				3,389,756				3,421,948				3,508,583				3,545,825
Energy		2,814,059				3,011,331				3,202,488				3,469,194				3,717,101
General business		2,690,018				2,690,559				2,742,590				2,793,768				2,976,990
Total commercial		12,175,140				12,472,907				12,657,784				13,077,535				13,565,706
Commercial real estate:
Office		1,030,755				1,073,346				1,094,060				1,085,257				1,099,563
Industrial		890,316				824,577				789,437				810,510				792,389
Multifamily		875,586				964,824				1,227,915				1,328,045				1,387,461
Retail		766,402				784,445				787,648				796,223				786,211
Residential construction and land development		118,416				128,939				119,079				119,394				121,258
Other commercial real estate		435,417				470,861				485,208				559,109				506,818
Total commercial real estate		4,116,892				4,246,992				4,503,347				4,698,538				4,693,700
Paycheck protection program		536,052				1,121,583				1,848,550				1,682,310				2,097,325
Loans to individuals:
Residential mortgage		1,747,243				1,772,627				1,797,478				1,863,003				1,849,144
Residential mortgages guaranteed by U.S. government agencies		376,986				413,806				420,051				408,687				384,247
Personal		1,395,623				1,388,534				1,306,637				1,277,447				1,213,178
Total loans to individuals		3,519,852				3,574,967				3,524,166				3,549,137				3,446,569
Total		$	20,347,936			$	21,416,449			$	22,533,847			$	23,007,520			$	23,803,300

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

	Sept. 30, 2021				June 30, 2021				Mar. 31, 2021				Dec. 31, 2020				Sept. 30, 2020
Texas:
Commercial	$	5,815,562			$	5,690,901			$	5,748,345			$	5,926,534			$	6,135,471
Commercial real estate	1,383,871				1,403,751				1,511,714				1,519,217				1,523,226
Paycheck protection program	115,623				342,933				537,899				501,079				614,970
Loans to individuals	901,121				885,619				848,194				855,410				794,055
Total Texas	8,216,177				8,323,204				8,646,152				8,802,240				9,067,722
Oklahoma:
Commercial	2,590,887				2,840,560				2,975,477				3,144,782				3,332,244
Commercial real estate	552,184				552,673				597,840				597,733				608,448
Paycheck protection program	192,474				242,880				468,002				413,108				487,247
Loans to individuals	2,014,099				2,063,419				2,043,705				2,052,784				2,034,576
Total Oklahoma	5,349,644				5,699,532				6,085,024				6,208,407				6,462,515
Colorado:
Commercial	1,874,613				1,904,182				1,910,826				1,929,320				1,993,364
Commercial real estate	526,653				656,521				777,786				879,648				893,626
Paycheck protection program	140,470				299,712				436,540				377,111				494,910
Loans to individuals	249,298				262,796				264,759				264,295				257,832
Total Colorado	2,791,034				3,123,211				3,389,911				3,450,374				3,639,732
Arizona:
Commercial	1,194,801				1,239,270				1,207,089				1,219,072				1,218,769
Commercial real estate	734,174				705,497				667,766				726,111				702,291
Paycheck protection program	42,815				104,946				208,481				211,725				272,114
Loans to individuals	182,506				178,481				179,031				177,948				166,203
Total Arizona	2,154,296				2,228,194				2,262,367				2,334,856				2,359,377
Kansas/Missouri:
Commercial	336,414				388,291				421,974				455,914				493,606
Commercial real estate	408,001				406,055				395,590				366,821				352,663
Paycheck protection program	6,920				41,954				60,741				56,011				80,230
Loans to individuals	100,920				103,092				104,954				105,995				96,598
Total Kansas/Missouri	852,255				939,392				983,259				984,741				1,023,097
New Mexico:
Commercial	287,695				304,804				307,395				303,833				288,374
Commercial real estate	437,302				437,996				448,298				473,204				473,697
Paycheck protection program	31,444				86,716				124,059				109,881				133,244
Loans to individuals	66,651				68,177				70,491				75,665				79,890
Total New Mexico	823,092				897,693				950,243				962,583				975,205
Arkansas:
Commercial	75,168				104,899				86,678				98,080				103,878
Commercial real estate	74,707				84,499				104,353				135,804				139,749
Paycheck protection program	6,306				2,442				12,828				13,395				14,610
Loans to individuals	5,257				13,383				13,032				17,040				17,415
Total Arkansas	161,438				205,223				216,891				264,319				275,652
TOTAL BOK FINANCIAL	$	20,347,936			$	21,416,449			$	22,533,847			$	23,007,520			$	23,803,300

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)

	Sept. 30, 2021				June 30, 2021				Mar. 31, 2021				Dec. 31, 2020				Sept. 30, 2020
Oklahoma:
Demand	$	5,080,162			$	4,985,542			$	4,823,436			$	4,329,205			$	4,493,978
Interest-bearing:
Transaction	11,692,679				12,065,844				12,828,070				12,603,658				12,586,449
Savings	510,906				500,344				487,862				420,996				401,062
Time	1,039,866				1,139,980				1,197,517				1,134,453				1,081,176
Total interest-bearing	13,243,451				13,706,168				14,513,449				14,159,107				14,068,687
Total Oklahoma	18,323,613				18,691,710				19,336,885				18,488,312				18,562,665
Texas:
Demand	3,987,503				3,752,790				3,592,969				3,449,882				3,152,106
Interest-bearing:
Transaction	4,985,465				4,335,113				4,257,234				3,800,427				3,482,555
Savings	165,043				160,805				154,406				139,173				136,787
Time	337,389				346,577				368,086				383,062				438,337
Total interest-bearing	5,487,897				4,842,495				4,779,726				4,322,662				4,057,679
Total Texas	9,475,400				8,595,285				8,372,695				7,772,544				7,209,785
Colorado:
Demand	2,158,596				1,991,343				2,115,354				2,168,404				2,057,603
Interest-bearing:
Transaction	2,337,354				2,159,819				2,100,135				2,170,485				1,861,763
Savings	79,873				73,990				73,446				69,384				68,230
Time	184,002				193,787				204,973				208,778				226,780
Total interest-bearing	2,601,229				2,427,596				2,378,554				2,448,647				2,156,773
Total Colorado	4,759,825				4,418,939				4,493,908				4,617,051				4,214,376
New Mexico:
Demand	1,222,895				1,197,412				1,131,713				941,074				964,908
Interest-bearing:
Transaction	837,630				723,757				736,923				733,007				713,418
Savings	107,615				105,837				103,591				91,646				85,463
Time	168,879				174,665				181,863				186,307				200,525
Total interest-bearing	1,114,124				1,004,259				1,022,377				1,010,960				999,406
Total New Mexico	2,337,019				2,201,671				2,154,090				1,952,034				1,964,314
Arizona:
Demand	1,110,884				943,511				915,439				905,201				928,671
Interest-bearing:
Transaction	784,614				820,901				835,795				768,220				771,319
Savings	16,468				13,496				13,235				12,174				11,498
Time	30,862				30,012				30,997				32,721				36,929
Total interest-bearing	831,944				864,409				880,027				813,115				819,746
Total Arizona	1,942,828				1,807,920				1,795,466				1,718,316				1,748,417

	Sept. 30, 2021				June 30, 2021				Mar. 31, 2021				Dec. 31, 2020				Sept. 30, 2020
Kansas/Missouri:
Demand	488,595				463,339				478,370				426,738				405,360
Interest-bearing:
Transaction	965,757				978,160				991,510				960,237				616,797
Savings	17,303				17,539				18,686				16,286				15,520
Time	13,040				13,509				13,898				14,610				16,430
Total interest-bearing	996,100				1,009,208				1,024,094				991,133				648,747
Total Kansas/Missouri	1,484,695				1,472,547				1,502,464				1,417,871				1,054,107
Arkansas:
Demand	41,594				46,472				45,889				45,834				44,712
Interest-bearing:
Transaction	149,611				195,125				141,207				122,388				164,439
Savings	3,289				3,445				3,000				2,333				2,389
Time	6,677				6,819				7,022				7,197				7,796
Total interest-bearing	159,577				205,389				151,229				131,918				174,624
Total Arkansas	201,171				251,861				197,118				177,752				219,336
TOTAL BOK FINANCIAL	$	38,524,551			$	37,439,933			$	37,852,626			$	36,143,880			$	34,973,000

NET INTEREST MARGIN TREND -- UNAUDITED
BOK FINANCIAL CORPORATION

	Three Months Ended
	Sept. 30, 2021			June 30, 2021			Mar. 31, 2021			Dec. 31, 2020			Sept. 30, 2020
TAX-EQUIVALENT ASSETS YIELDS
Interest-bearing cash and cash equivalents	0.14	%		0.10	%		0.10	%		0.10	%		0.12	%
Trading securities	2.04	%		1.95	%		2.06	%		2.02	%		1.92	%
Investment securities, net of allowance	5.02	%		5.01	%		4.88	%		4.88	%		4.85	%
Available for sale securities	1.80	%		1.85	%		1.84	%		1.98	%		2.11	%
Fair value option securities	2.62	%		2.60	%		1.95	%		2.27	%		1.92	%
Restricted equity securities	2.55	%		3.36	%		2.86	%		3.25	%		2.53	%
Residential mortgage loans held for sale	3.06	%		2.91	%		2.71	%		2.75	%		3.01	%
Loans	3.68	%		3.54	%		3.55	%		3.68	%		3.60	%
Allowance for loan losses
Loans, net of allowance	3.73	%		3.60	%		3.62	%		3.75	%		3.67	%
Total tax-equivalent yield on earning assets	2.78	%		2.75	%		2.78	%		2.92	%		3.04	%
COST OF INTEREST-BEARING LIABILITIES
Interest-bearing deposits:
Interest-bearing transaction	0.09	%		0.10	%		0.12	%		0.14	%		0.17	%
Savings	0.04	%		0.04	%		0.04	%		0.05	%		0.05	%
Time	0.55	%		0.58	%		0.70	%		0.89	%		1.13	%
Total interest-bearing deposits	0.13	%		0.14	%		0.17	%		0.19	%		0.26	%
Funds purchased and repurchase agreements	0.20	%		0.16	%		0.19	%		0.28	%		0.17	%
Other borrowings	0.37	%		0.34	%		0.39	%		0.42	%		0.43	%
Subordinated debt	4.63	%		4.87	%		4.92	%		4.87	%		4.89	%
Total cost of interest-bearing liabilities	0.19	%		0.21	%		0.24	%		0.28	%		0.31	%
Tax-equivalent net interest revenue spread	2.59	%		2.54	%		2.54	%		2.64	%		2.73	%
Effect of noninterest-bearing funding sources and other	0.07	%		0.06	%		0.08	%		0.08	%		0.08	%
Tax-equivalent net interest margin	2.66	%		2.60	%		2.62	%		2.72	%		2.81	%

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
	Sept. 30, 2021				June 30, 2021				Mar. 31, 2021				Dec. 31, 2020				Sept. 30, 2020
Nonperforming assets:
Nonaccruing loans:
Commercial:
Energy	$	45,500			$	70,341			$	101,800			$	125,059			$	126,816
Services	25,714				29,913				28,033				25,598				25,817
Healthcare	509				527				3,187				3,645				3,645
General business	8,951				11,823				14,053				12,857				13,675
Total commercial	80,674				112,604				147,073				167,159				169,953
Commercial real estate	21,223				26,123				27,243				27,246				12,952
Loans to individuals:
Permanent mortgage	30,674				31,473				32,884				32,228				31,599
Permanent mortgage guaranteed by U.S. government agencies	9,188				9,207				8,564				7,741				6,397
Personal	188				229				255				319				252
Total loans to individuals	40,050				40,909				41,703				40,288				38,248
Total nonaccruing loans	$	141,947			$	179,636			$	216,019			$	234,693			$	221,153
Accruing renegotiated loans guaranteed by U.S. government agencies	178,554				171,324				154,591				151,775				142,770
Real estate and other repossessed assets	28,770				57,337				70,911				90,526				52,847
Total nonperforming assets	$	349,271			$	408,297			$	441,521			$	476,994			$	416,770
Total nonperforming assets excluding those guaranteed by U.S. government agencies	$	161,529			$	227,766			$	278,366			$	317,478			$	267,603
Accruing loans 90 days past due1	$	223			$	252			$	395			$	10,369			$	7,684
Gross charge-offs	$	9,584			$	18,304			$	16,905			$	18,251			$	26,661
Recoveries	(1,769		)		(2,856		)		(2,437		)		(1,592		)		(4,232		)
Net charge-offs	$	7,815			$	15,448			$	14,468			$	16,659			$	22,429
Provision for loan losses	$	(27,395	)		$	(25,064	)		$	(21,770	)		$	(14,478	)		$	6,609
Provision for credit losses from off-balance sheet unfunded loan commitments	4,952				(8,590		)		(4,044		)		8,952				(4,950		)
Provision for expected credit losses from mortgage banking activities	(534		)		(1,222		)		885				(923		)		(770		)
Provision for credit losses related to held-to maturity (investment) securities portfolio	(23		)		(124		)		(71		)		(51		)		(889		)
Total provision for credit losses	$	(23,000	)		$	(35,000	)		$	(25,000	)		$	(6,500	)		$	—

	Three Months Ended
	Sept. 30, 2021			June 30, 2021			Mar. 31, 2021			Dec. 31, 2020			Sept. 30, 2020
Allowance for loan losses to period end loans	1.36	%		1.46	%		1.56	%		1.69	%		1.76	%
Allowance for loan losses to period end loans excluding PPP loans2	1.40	%		1.54	%		1.70	%		1.82	%		1.93	%
Combined allowance for loan losses and accrual for off-balance sheet credit risk from unfunded loan commitments to period end loans	1.50	%		1.57	%		1.71	%		1.85	%		1.88	%
Combined allowance for loan losses and accrual for off-balance sheet credit risk from unfunded loan commitments to period end loans excluding PPP loans2	1.54	%		1.66	%		1.86	%		2.00	%		2.06	%
Nonperforming assets to period end loans and repossessed assets	1.71	%		1.90	%		1.95	%		2.07	%		1.75	%
Net charge-offs (annualized) to average loans	0.15	%		0.28	%		0.25	%		0.28	%		0.37	%
Net charge-offs (annualized) to average loans excluding PPP loans2	0.16	%		0.30	%		0.28	%		0.31	%		0.41	%
Allowance for loan losses to nonaccruing loans1	208.41	%		183.00	%		169.87	%		171.24	%		195.47	%
Combined allowance for loan losses and accrual for off-balance sheet credit risk from unfunded loan commitments to nonaccruing loans1	230.43	%		197.25	%		185.72	%		187.51	%		208.49	%

¹  Excludes residential mortgage loans guaranteed by agencies of the U.S. government.
²  Metric meaningful due to the unique characteristics and short-term nature of the PPP loans.

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

		Three Months Ended												3Q21 vs 2Q21								3Q21 vs 3Q20
		Sept. 30, 2021				June 30, 2021				Sept. 30, 2020				$ change				% change				$ change				% change
Commercial Banking
Net interest revenue		$	134,104			$	130,901			$	149,946			$	3,203			2.4		%		$	(15,842	)		(10.6	)	%
Fees and commissions revenue		56,452				63,368				50,085				(6,916		)		(10.9	)	%		6,367				12.7		%
Combined net interest and fee revenue		190,556				194,269				200,031				(3,713		)		(1.9	)	%		(9,475		)		(4.7	)	%
Other operating expense		68,301				71,351				66,846				(3,050		)		(4.3	)	%		1,455				2.2		%
Corporate expense allocations		11,769				12,512				5,172				(743		)		(5.9	)	%		6,597				127.6		%
Net income		102,694				72,632				75,097				30,062				41.4		%		27,597				36.7		%
Average assets		28,474,182				28,160,594				28,000,183				313,588				1.1		%		473,999				1.7		%
Average loans		16,588,875				16,981,888				18,677,401				(393,013		)		(2.3	)	%		(2,088,526		)		(11.2	)	%
Average deposits		17,881,673				17,049,772				15,375,450				831,901				4.9		%		2,506,223				16.3		%
Consumer Banking
Net interest revenue		$	27,222			$	24,945			$	33,130			$	2,277			9.1		%		$	(5,908	)		(17.8	)	%
Fees and commissions revenue		44,405				37,714				67,974				6,691				17.7		%		(23,569		)		(34.7	)	%
Combined net interest and fee revenue		71,627				62,659				101,104				8,968				14.3		%		(29,477		)		(29.2	)	%
Other operating expense		49,483				52,453				59,155				(2,970		)		(5.7	)	%		(9,672		)		(16.4	)	%
Corporate expense allocations		11,516				11,599				10,691				(83		)		(0.7	)	%		825				7.7		%
Net income		12,432				1,698				26,855				10,734				632.2		%		(14,423		)		(53.7	)	%
Average assets		10,083,593				10,087,488				9,898,112				(3,895		)		—		%		185,481				1.9		%
Average loans		1,763,705				1,786,242				1,825,865				(22,537		)		(1.3	)	%		(62,160		)		(3.4	)	%
Average deposits		8,516,942				8,469,043				7,940,973				47,899				0.6		%		575,969				7.3		%
Wealth Management
Net interest revenue		$	55,196			$	52,293			$	22,985			$	2,903			5.6		%		$	32,211			140.1		%
Fees and commissions revenue		97,966				78,841				111,655				19,125				24.3		%		(13,689		)		(12.3	)	%
Combined net interest and fee revenue		153,162				131,134				134,640				22,028				16.8		%		18,522				13.8		%
Other operating expense		87,417				79,429				82,868				7,988				10.1		%		4,549				5.5		%
Corporate expense allocations		10,101				10,343				9,397				(242		)		(2.3	)	%		704				7.5		%
Net income		41,406				31,061				31,212				10,345				33.3		%		10,194				32.7		%
Average assets		19,109,700				19,201,041				16,204,510				(91,341		)		(0.5	)	%		2,905,190				17.9		%
Average loans		1,971,380				1,968,513				1,777,008				2,867				0.1		%		194,372				10.9		%
Average deposits		9,120,446				9,695,319				9,090,116				(574,873		)		(5.9	)	%		30,330				0.3		%
Fiduciary assets		60,497,576				58,654,788				48,887,513				1,842,788				3.1		%		11,610,063				23.7		%
Assets under management or administration		98,842,789				96,632,748				82,419,932				2,210,041				2.3		%		16,422,857				19.9		%

Contact:

Sue Hermann
Senior Vice President, Corporate Communications, BOK Financial
303-312-3488

FAQ

What were BOK Financial's earnings results for Q3 2021?

BOK Financial reported a net income of $188 million, or $2.74 per diluted share for Q3 2021.

How did BOK Financial's Wealth Management segment perform in Q3 2021?

The Wealth Management segment achieved record revenues of $153 million, a 14% increase from the same quarter last year.

What is the current loan trend for BOK Financial?

BOK Financial experienced a decrease in total loans by $1.1 billion, largely due to reduced Paycheck Protection Program loans.

What is the common equity Tier 1 capital ratio for BOK Financial?

As of September 30, 2021, BOK Financial's common equity Tier 1 capital ratio was 12.26%.

How have BOK Financial's deposits changed recently?

Average deposits increased by $344 million to $37.8 billion in Q3 2021.