Bok Financial Corporation · NASDAQ:BOKF
Bok Financial — Investor Presentation (2016)
31 slides from Bok Financial's investor presentation, 2016
Slide 1: Investor Presentation
Investor Presentation NASDAQ: BOKF 1
Slide 2: Forward-Looking Statements
Forward-Looking Statements: This presentation contains 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. These remarks constitute forward-lookin
Slide 3: Agenda
Agenda Introduction & Overview Earnings & Profitability Capital, Liquidity & Funding Loan Portfolio & Credit Quality Energy Exposure 3
Slide 4: Executive Leadership Team
Executive Leadership Team Leadership Today’s presenters Other executive leadership Years with Years with Name Position BOKF Name Position BOKF President and Chief Executive Steven Bradshaw 25 Officer Steven Nell EVP, Chief Financial Officer 24 EVP, Regional Banks; Chairman Norman Bagwell 8 and CEO,
Slide 5: BOK Financial at a Glance
BOK Financial at a Glance One of the largest U.S. bank holding companies Valuable Midwest / Southwest franchise Seasoned management team Consistent execution and solid performance across all economic cycles Proven ability to deliver organic growth Leading energy and healthcare lender nat
Slide 6: Supported by Diverse Economies in Core States
Supported by Diverse Economies in Core States Top 10 industries Oklahoma Texas Health care Health care Retail 7% Retail 6% Mining 6% Wholesale 6% 10% Mining 8% Wholesale 9% 6% Construction 5% Construction Manufacturing 5% 10% Transportation Finance and 5% warehousing Manufacturing 4% 15% Professiona
Slide 7: Agenda
Agenda Introduction & Overview Earnings & Profitability Capital, Liquidity & Funding Loan Portfolio & Credit Quality Energy Exposure 7
Slide 8: Strong, Consistent Core Profitability
Strong, Consistent Core Profitability Bank level 2015 return metrics Return on risk weighted assets Return on average assets Return on average equity 1.28% 0.94% 10.3% 1.08% 0.81% 7.4% Peer median¹ Peer median¹ Peer median¹ Bank level ROAA volatility (standard deviation)² 2.74% 2.77% 2.98% 0.99% 0.8
Slide 9: Diversified Revenue Sources
Diversified Revenue Sources TTM revenue sources (12 months ended 3/31/16) Revenue CAGR 2010–2015 Brokerage and Trading 5% Transaction Card 5% Trust Fees 15% Brokerage & Trading Service Charges (3%) 10% Mortgage Banking 9% Transaction Overall CAGR 5% Net Interest 52% Card 9% TTM fees and commissions
Slide 10: Agenda
Agenda Introduction & Overview Earnings & Profitability Capital, Liquidity & Funding Loan Portfolio & Credit Quality Energy Exposure 10
Slide 11: Consolidated and Bank Level Capital
Consolidated and Bank Level Capital Q1 2016 Q4 2015 Q1 2015 Consolidated Capital Ratios Common Equity Tier 1 12.0% 12.1% 13.1% Tier 1 12.0% 12.1% 13.1% Total Capital Ratio 13.2% 13.3% 14.4% Leverage Ratio 9.1% 9.3% 9.7% Tangible Common Equity Ratio¹ 9.3% 9.0% 9.9% Holding Company Cash $267mm Bank Le
Slide 12: Robust Capital Position
Robust Capital Position Consolidated Common Equity Tier 1 (%) Bank level 10.3% 12.6% 11.8% 11.7% 11.5% 10.6% 10.2% 10.8% 12.1% 12.5% 9.2% 10.9% 10.4% 12.4% 12.0% 12.1% 10.9% 10.7% 10.6% 10.6% 10.3% Peer median: 10.5% 10.0% 9.9% 9.7% 9.7% 9.3% SIVB ZION RF FMER FRC CMA FHN SNV EVER HBAN PBCT ASB BBB+
Slide 13: Strong Liquidity Position
Strong Liquidity Position Total cash and government agency securities as % of total assets (%) 31% 26% 25% 22% 21% 18% 18% 17% Peer median: 17% 14% 12% 12% 7% 2% SIVB FHN ZION FMER RF CMA SNV PBCT ASB HBAN FRC EVER Source: Company filings; SNL Financial Note: Financial data as of March 31, 2016 13
Slide 14: Strong Liquidity Position (continued)
Strong Liquidity Position (continued) Gross loans held for investment / total deposits (%) 120% 97% 98% 93% 93% Peer median: 88% 88% 89% 86% 83% 83% 78% 77% 46% SIVB FMER ZION RF FHN CMA FRC HBAN ASB SNV PBCT EVER Source: SNL Financial Note: Financial data as of March 31, 2016 14
Slide 15: Strong Core Deposit Franchise
Strong Core Deposit Franchise Deposit mix and cost ($bn) Geographic deposit mix Demand Interest-bearing transaction Savings Time $24 TX 26% $21 $21 $21 $20 $20 11% $18 2% OK NM 54% 7% AR 2% 48% CO $12 AZ 6% KC 3% 2% MSA Branches Deposit share Tulsa, OK 26 30.0% $6 Dallas-Fort Worth-Arlington, TX 23
Slide 16: Agenda
Agenda Introduction & Overview Earnings & Profitability Capital, Liquidity & Funding Loan Portfolio & Credit Quality Energy Exposure 16
Slide 17: Commercial Banking: Diversified by Sector and Geography
Commercial Banking: Diversified by Sector and Geography as of 3/31/16 Loan segmentation Loans by principal market Outstanding $mm % of total Energy $3,029 18.9% Texas Services 2,729 17.0% Commercial 35% Wholesale/Retail 1,452 9.1% Manufacturing 601 3.8% Healthcare 1,995 12.5% Other C&I 482 3.0% Tota
Slide 18: Commercial Real Estate: Disciplined Concentration Management
Commercial Real Estate: Disciplined Concentration Management as of 3/31/16 CRE concentration by product type CRE concentration by geography Office 20% New Mexico 10% Texas 36% Arkansas 2% Multifamily 22% Colorado 6% Industrial 17% Residential Arizona C&D 18% Retail 5% Oklahoma 24% 22% Other CRE 12%
Slide 19: Key Credit Quality Metrics as of 3/31/2016
Key Credit Quality Metrics as of 3/31/2016 Combined allowance for credit losses to period TTM net charge-offs to average loans: end loans: 1.50% 0.18% Combined allowance for loan losses for credit losses to Non-performing assets to period end loans and nonaccruing loans1: repossessed assets1: 108% 1
Slide 20: Historical Net Charge-Offs
Historical Net Charge-Offs Net charge-offs (recoveries) to average loans 3.10% BOK Financial Peer median 2.60% 2.10% 1.60% 1.10% 0.60% 0.10% (0.40)% Q3 Q2 Q3 Q1 Q2 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2005 2006 2007 2
Slide 21: Nonperforming Assets
Nonperforming Assets Core nonperforming assets Core Nonaccrual OREO Core NPA as % of Total Outstanding plus OREO $300 1.80% 1.60% $250 1.40% $200 1.20% Outstanding ($mm) 1.00% $150 0.80% $100 0.60% 0.40% $50 0.20% $0 0.00% 2013 2014 Q1 15 Q2 15 Q3 15 Q4 15 Q1 16 21
Slide 22: Nonaccrual Loans by Sector at 3/31/16
Nonaccrual Loans by Sector at 3/31/16 CRE - Construction & Nonaccrual loans by sector ($mm) Land Development March 31, 2016 2.0% CRE - All other Consumer 1.9% Energy $160 0.1% Other Commercial 15 Residential Real Estate 58 Consumer 0 CRE - Construction & Land Development 5 Residential Real Estate CR
Slide 23: Agenda
Agenda Introduction & Overview Earnings & Profitability Capital, Liquidity & Funding Loan Portfolio & Credit Quality Energy Exposure 23
Slide 24: Energy Portfolio Highlights
Energy Portfolio Highlights Portfolio breakdown Summary highlights 100 year history in energy lending and expertise to manage through downturns Energy Only 16 basis points of gross losses in energy for the 15 years ended December 31, 2015 Services 8% As of March 31, 2016: Midstream & $5.3bn co
Slide 25: Quarterly Energy Stress Test
Quarterly Energy Stress Test Stress test assumptions Stress test results The results of the April 2016 Energy stress test were 2016: $1.65 / mmbtu, $34 / bbl consistent with the prior quarter 2017: $2.00 / mmbtu, $37 / bbl Borrowers have largely taken steps to position themselves to perform thro
Slide 26: Additional Energy Detail
Additional Energy Detail Energy credit quality regression Summary highlights BOKF remained disciplined during oil and gas boom, with continued focus on senior secured, first lien, reserve-based lending: Limited exposure to energy services companies Limited second lien exposure at present: 2 tr
Slide 27: Should Stress Losses Exceed our Estimates, Bank Still Maintains Robust Capital Levels
Should Stress Losses Exceed our Estimates, Bank Still Maintains Robust Capital Levels Illustrative stress loss assumptions (Moody's “Severe Stress" – April 14, 2016)¹ Exploration & Total energy Services Production Midstream Downstream Other Probability of default (PD) 42.9% 42.9% 18.2% 28.0% 18.2% W
Slide 28: Appendix
© BOK FINANCIAL ~
Slide 29: Net Charge-Offs by Line of Business
0 1,000 2,000 3,000 4,000 5,000 (2,000) (1,000) (10,000) 5,000 (5,000) 0 10,000 15,000 20,000 25,000 1Q11 1Q11 Consumer 2Q11 2Q11 Commercial 3Q11 3Q11 4Q11 4Q11 1Q12 1Q12 2Q12 2Q12 3Q12 3Q12 4Q12 4Q12 1Q13 1Q13 2Q13 2Q13 3Q13 3Q13 4Q13 4Q13 1Q14 1Q14 2Q14 2Q14 Chargeoffs 3Q14 3Q14 4Q14 4Q14 1Q15 1Q1
Slide 30: BOK Financial: Balance Sheet and Income Statement
BOK Financial: Balance Sheet and Income Statement Balance sheet ($mm) Income statement ($mm) 12/31/15 3/31/16 12/31/15 3/31/16 Assets (full year) (three months) Cash and due from banks 574 482 Net interest revenue 703 183 Interest-bearing cash and cash equivalents 2,070 1,831 Provision for credit lo
Slide 31: Non-GAAP Financial Measures
Non-GAAP Financial Measures ($mm) Q1 2016 Q4 2015 Q1 2015 Consolidated Tangible Common Equity Ratio Total shareholders' equity $3,322 $3,231 $3,357 Less: Goodwill and intangible assets, net 429 429 411 Tangible common equity $2,893 $2,801 $2,946 Total assets $31,414 $31,476 $30,300 Less: Goodwill an