Bok Financial Corporation · NASDAQ:BOKF
Bok Financial — Investor Presentation (2015)
33 slides from Bok Financial's investor presentation, 2015
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: BOKF at a Glance
BOKF at a Glance Top 25 bank holding company Strong franchise throughout the Midwest and Southwest Leading energy and healthcare lender nationwide Seasoned management team with consistent execution and solid performance across all economic cycles At 3/31/15: NASDAQ: BOKF Assets $30.3 bil L
Slide 4: BOKF Investment Attributes
BOKF Investment Attributes Attribute Evidence Focused on long-term shareholder value Strong growth in total shareholder return over several economic cycles Management alignment with Insiders own 69% of outstanding shares shareholders Industry-leading performance across all 24-year track record of pr
Slide 5: Driving Long Term Shareholder Value
Driving Long Term Shareholder Value As of 3/31/15 5 Yr. TSR 10 Yr. TSR 15 Yr. TSR BOKF 34% 87% 362% Peer average 50% 21% 178% Peer median 37% 11% 121% KBW Bank Index 52% -4% 35% NASDAQ Bank Index 60% 15% 150% “There is no principle more emphasized in our organization than managing for long-term valu
Slide 6: Diversified Business Platform
Diversified Business Platform Retail and Commercial Banking Wealth Management Transaction Processing Mortgage Banking 6
Slide 7: Diversified Revenue Sources
Diversified Revenue Sources CAGR 2009- Brokerage & LT Growth Rates 2014 Trading 10.4% Brokerage and Trading 8.0% Transaction Card (1) 3.2% Trans. Card Trust Fees 11.8% 9.6% Service Charges (1) (4.7%) Mortgage Banking 10.9% Net Interest Trust 50.9% Overall CAGR 5.3% Fees 9.0% (1) Impacted by Regulati
Slide 8: Deposit Franchise
Deposit Franchise Market Branches Deposit Share Tulsa, OK 26 29.96 TX Dallas-Fort Worth-Arlington, TX 23 1.71 OK Oklahoma City, OK 20 12.28 Houston-The Woodlands-Sugar Land, TX 14 0.66 NM Denver-Aurora-Lakewood, CO 11 2.05 Albuquerque, NM 17 10.05 AR Phoenix-Mesa-Scottsdale, AZ 4 0.99 CO Kansas City
Slide 9: Commercial Banking: Diversified by Sector and Geography
Commercial Banking Diversified by Sector and Geography Loan Portfolio Breakdown - by Sector: Loans by Principal Market: Commercial (In Millions) 3/31/2015 (In Millions) 3/31/2015 Energy $ 2,903.0 19.8% Oklahoma 5,537.0 37.7% Services $ 2,728.4 18.6% Texas 5,228.3 35.6% Wholesale/Retail $ 1,270.3 8.7
Slide 10: Commercial Banking: Energy Lending
Commercial Banking Energy Lending Wholesale/Energy $2.9 billion energy portfolio at 3/31/15 Retail Services 3% 8% Core competency of BOK for over 100 years Midstream 3% 50-60% loan to value on proved producing reserves ~59% of production loans are secured by oil Regionally diverse oil and
Slide 11: Energy Price Volatility & Loss Rates
Energy Price Volatility & Loss Rates • At 12/31/14, BOKF’s 20 year average gross loss rate on energy production loans (gross charge-offs as a percent of period end loans) is 6.4 basis points • Over the last 20 years, NG prices ranged from $1.05 to $15.38 and oil prices ranged from $10.72 to $145.29
Slide 12: Commercial Banking: Healthcare Lending
Commercial Banking Healthcare Lending Healthcare Commitments Growing line of business within Skilled commercial Nursing 37% $1.5 billion portfolio at 3/31/15 Portfolio increased at a compound Medical annual rate of 10% since 2007 Services 28% Specialty National expertise in skilled Hospitals
Slide 13: Commercial Real Estate Portfolio Trends
Commercial Banking Commercial Real Estate Portfolio Trends CRE By Market $750 KS/MO 6% OK AZ 21% $600 15% Millions $450 CO 7% $300 AR 3% $150 TX NM 38% 10% $0 C&D Retail Office Multifamily Industrial Other CRE 6/30/2014 9/30/2014 12/31/2014 3/31/2015 13
Slide 14: Wealth Management
Wealth Management Fiduciary and Asset Management Revenue ($millions) $67 billion in assets under $115.7 $121.4 management or custody $96.1 $38 billion in fiduciary assets $80.1 $69.0 $73.3 $66.2 More than $1 trillion in traded securities annually Clients include high net worth 2009 2010 2011 201
Slide 15: Transaction Processing
ATM Network 600 EFT Transaction Among the top 10 networks in the US 500 Volumes (M) Operates in 22 states; more than 50% of clients 400 CAGR: 9.93% outside Oklahoma 300 Clients: 211 Banks, 139 Credit Unions, 6 C- 200 Store partners 100 In 2014, processed 496 million EFT transactions 0 Mercha
Slide 16: Mortgage Banking: Building a Recurring Revenue Model
Mortgage Banking Building a Recurring Revenue Model Housed within the consumer banking business 180,000 Several key strategic Mortgage 160,000 Banking initiatives: 140,000 Revenue 120,000 ($000s) Build servicing portfolio 100,000 80,000 Expand correspondent 60,000 network 40,000 20,000 Bui
Slide 17: Mortgage Banking: Building a Recurring Revenue Model
Mortgage Banking Building a Recurring Revenue Model Servicing Portfolio ($B) Servicing Revenue ($MM) 20.0 15.0 Continued 14.0 expansion of 15.0 13.0 12.0 recurring 10.0 11.0 10.0 servicing 5.0 9.0 8.0 revenue - 7.0 Q1 Q2 Q3 Q4 Q1 Q1 Q2 Q3 Q4 Q1 2014 2014 2014 2014 2015 2014 2014 2014 2014 2015 Cor
Slide 18: Q1 2015 Financial Results
© BOK FINANCIAL ~ Q1 2015 Financial Results
Slide 19: Q1 2015 Highlights
Q1 2015 Highlights Q1 2015 Q4 2014 Q1 2014 Net Income $74.8 $64.3 $76.6 Diluted EPS $1.08 $0.93 $1.11 Double digit annualized loan growth Record quarterly revenue from fee-generating businesses, led by mortgage Good expense controls Continued excellent credit quality across the portfolio NOT
Slide 20: Additional Q1 2015 Highlights
Additional Q1 2015 Highlights % Growth, % Growth, $billions Q1 2015 Q4 2014 Q1 2014 Seq. YOY Period-End $14.7 $14.2 $13.1 3.4% 12.3% (14.1% ann.) Loans Avg. Loans 14.6 13.9 12.9 4.8% 12.4% (20.8% ann.) Fiduciary $37.5 $36.0 $31.3 4.2% 19.8% Assets Drivers: • Loans: Continued strong loan growth acros
Slide 21: Commercial Loan Growth
Commercial Loan Growth Sequential YOY Mar 31, Dec 31, Loan Mar 31, Mar 31, Loan ($millions) 2015 2014 Growth 2015 2014 Growth Energy $2,903.0 $2,860.4 1.5% $2,903.0 $2,344.1 23.8% Services 2,728.4 2,518.2 8.3% 2,728.4 2,232.5 22.2% Wholesale/retail 1,270.3 1,313.3 -3.3% 1,270.3 1,226.0 3.6% Manufact
Slide 22: Commercial Real Estate
Commercial Real Estate Sequential YOY Mar 31, Dec 31, Loan Mar 31, Mar 31, Loan ($millions) 2015 2014 Growth 2015 2014 Growth Residential $139.2 $143.6 -3.1% $139.2 $184.8 -24.7% construction and land development Retail 658.9 666.9 -1.2% 658.9 640.5 2.9% Office 513.9 415.5 23.7% 513.9 436.3 17.8% Mu
Slide 23: Total Loans
Total Loans ($millions) Mar 31, Dec 31, Sequential Mar 31, Mar 31, YOY 2015 2014 Loan 2015 2014 Loan Growth Growth Total Commercial $9,391.2 $9,095.7 3.2% $9,391.2 $8,051.7 16.6% Total CRE 2,935.5 2,728.2 7.6% 2,935.5 2,631.4 11.6% Total Residential 1,927.0 1,949.5 -1.2% 1,927.0 2,018.7 -4.5% Mortga
Slide 24: Loan Portfolio by Geography
Loan Portfolio by Geography ($millions) Mar 31, Dec 31, Sequential Mar 31, Mar 31, YOY 2015 2014 Loan 2015 2014 Loan Growth Growth Oklahoma $5,537.0 $5,419.5 2.2% $5,537.0 $5,061.7 9.4% Texas 5,228.3 4,967.3 5.3% 5,228.3 4,524.1 15.6% Albuquerque 824.1 818.7 0.7% 824.1 801.4 2.8% Arkansas 190.4 196.
Slide 25: Net Interest Revenue and Margin
Net Interest Revenue and Margin Q1 2015 Q4 2014 Q3 2014 Q2 2014 Q1 2014 Net Interest $167.7 $169.7 $166.8 $166.1 $162.6 Revenue ($mil) Net Interest 2.55% 2.61% 2.67% 2.75% 2.71% Margin NIM dilutive 0.14% 0.14% 0.06% --- --- impact of FHLB/Fed trade Normalized NIM 2.70% 2.75% 2.73% 2.75% 2.71% • 4 ba
Slide 26: Record Quarterly Fees and Commissions Revenue
Record Quarterly Fees and Commissions Revenue ($millions) Q1 2015 % Growth, % Growth, Seq. YOY Brokerage and trading $31.7 3.6% 7.4% Transaction card 31.0 (1.5%) 6.4% Fiduciary and asset management 31.5 2.7% 22.3% Deposit service charges and fees 21.7 (4.0%) (4.4%) Mortgage banking 39.3 30.6% 72.1%
Slide 27: Change in Fair Value of Mortgage Servicing Rights
Change in Fair Value of Mortgage Servicing Rights $8.5 million decrease in MSR value at quarter end driven by continued decrease in interest rates during the quarter Net of hedges P&L impact $5.0 million pretax 10-year treasury rate 1.93% at quarter end, compared to 2.17% at 12/31/14 Q1 2015 Q
Slide 28: Expense Review
Expense Review ($millions) Q1 2015 Q4 2014* Q1 2014 ** %Incr. %Incr. Seq. YOY Personnel Expense $128.5 $124.9 $119.9 2.9% 7.2% Other Operating Expense $ 91.8 $96.1 $80.7 (4.5%) 13.7% Total operating expense $220.3 $221.0 $200.6 (0.3%) 9.8% Total OpEx/Total Rev. 66.0% 67.5% 66.1% • Seasonal increase
Slide 29: Balance Sheet Strength
Balance Sheet Strength Q1 2015 Q4 2014 Q1 2014 Period End AFS Securities $9.2 billion $9.0 billion $9.9 billion Average AFS securities $9.1 billion $9.2 billion $10.1 billion Period End Deposits $21.2 billion $21.1 billion $20.4 billion Average deposits $21.2 billion $20.7 billion $20.2 billion Comm
Slide 30: $9.0B AFS Portfolio
$9.0B AFS Portfolio High Quality, Actively Managed Securities portfolio used primarily to manage interest rate risk and generate incremental net Agency Other, interest revenue CMBS, $0.4 $2.2 Consistent strategy; actively managed for total return Total AFS portfolio estimated duration of 2.9 A
Slide 31: Solid Credit Quality at March 31, 2015
Solid Credit Quality at March 31, 2015 Continued Positive Trends Net annualized charge-offs to Alowance for credit losses to average loans: period end loans: (0.23%) 1.35% (Net recoveries in five of the last six quarters) Allowance for credit losses to Non-performing assets to period nonaccru
Slide 32: 2015 Assumptions
2015 Assumptions Continued low-double-digit loan growth NII will increase in 2015 from earning asset composition and stable to improving NIM Provision for credit losses of $15-$20 million beginning in Q2 Continued mid-single-digit revenue growth from fee-generating businesses Mid-single-di
Slide 33: Summary
Summary Diverse sources of revenue Capital and willingness to make accretive acquisitions Deep and experienced Sound financial condition management team Exceptional bench strength Differentiated business model Multiple growth drivers BOK Financial is a tenacious competitor BOK Financ