Bok Financial Corporation · NASDAQ:BOKF
Bok Financial — Investor Presentation (2020)
23 slides from Bok Financial's investor presentation, 2020
Slide 1: Investor Presentation
Investor Presentation NASDAQ: BOKF 1
Slide 2: Legal Disclaimers
Legal Disclaimers Forward-Looking Statements: This presentation 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 exp
Slide 3: NASDAQ: BOKF
NASDAQ: BOKF • Top 30 national/regional bank* • Midwest/Southwest franchise with 122 full service locations across eight states • Seasoned management team • Proven ability to deliver organic growth March 31, 2020 Assets $47 billion • Consistent execution Loans $22 billion • Consistent strategy Depos
Slide 4: Core Strategy
Core Strategy Build a recession-ready bank that will outperform peers across the economic cycle $550,000 $500,000 $450,000 Earnings Per Share CAGR across 28 year history of BOKF is 8.9% $400,000 $350,000 $300,000 $250,000 $200,000 $150,000 $100,000 $50,000 $0 “There is no principle more emphasized i
Slide 5: Diverse Revenue Sources
Diverse Revenue Sources • More than 40% fee income is a differentiator for BOKF compared to other midsized regional banks Portfolio Composition at 03/31/2020 • Well diversified: no single component of fee income accounts for 15% of total revenue Brokerage and Trading • Further diversity within the f
Slide 6: Strong Balance Sheet
Strong Balance Sheet Metric: 03/31/2020 Period End Loans $22.4 billion Period End Deposits $29.2 billion Loan to Deposit Ratio 77% Regulatory minimum for Capital Ratios: 03/31/2020 well-capitalized: Common Equity Tier 1 7% 10.98% Tier 1 Capital Ratio 8.5% 10.98% Total Capital Ratio 10.5% 12.65% Leve
Slide 7: Strong Core Deposit Franchise
Strong Core Deposit Franchise Deposit mix and cost ($bn) Geographic deposit mix Demand Interest-bearing transaction Savings Time TX $30 $29.2 21% $27.6 8% 2% NM $25.3 5% $24 $22.7 AR $22.1 1% OK 52% CO 57% 13% $18 AZ KS/MO 5% 3% $12 MSA Branches Deposit share Tulsa, OK 23 32% Dallas-Fort Worth-Arlin
Slide 8: Diversified Loan Portfolio
Diversified Loan Portfolio Loan Portfolio Segmentation Loan Portfolio by Collateral Location Energy 18% TX 31% Services OK 18% Healthcare 17% 14% NM 4% Loans to Individuals CO General Other 14% 12% Business 22% 16% AZ Commercial 8% Real Estate KS/MO 20% 6% Disciplined concentration management Divers
Slide 9: Energy Banking
Energy Banking Over 100 year history in energy lending and a Portfolio Composition at 03/31/2020 playbook that works • Focus on first lien, senior secured E&P lending – the “sweet spot” in energy lending • Internal staff of 16 petroleum engineers and engineering techs to confirm property values – a
Slide 10: Healthcare Banking
Healthcare Banking Portfolio Composition at 03/31/2020 • As of March 31, 2020, outstandings totaled $3.2 billion across 31 states • Healthcare portfolio characteristics: Favorable LIBOR spreads 12% Above-average loan utilization rates Predominately BOK Financial originated 13% Senior Housing c
Slide 11: Commercial Real Estate
Commercial Real Estate CRE Portfolio by Product Type Retail Office 17% 22% • $4.5 billion outstanding and $1.4 billion unfunded commitments at March 31, 2020 • BOKF allocates 175% of Tier 1 capital plus reserves to CRE Industrial 16% • Further controls and limitations by product type and geography.
Slide 12: Wealth Management
Wealth Management Four primary lines of business 500 Wealth Management Revenue 450 • Private Wealth 400 • Brokerage & Trading Services CAGR: 7.8% 350 • Institutional Wealth Management 300 • Cavanal Hill Investment Management 250 • Clients include high net worth individuals, corporations, pensions, 2
Slide 13: Wealth Management cont.
Wealth Management cont. 200 Brokerage and Trading Revenue Brokerage & Trading Services 180 160 CAGR: 3.5% 140 • Institutional Trading and Sales: Institutional investment products and services, including 120 institutional investment guidance, advanced 100 portfolio strategies, taxable and tax-exempt
Slide 14: Transaction Processing
Transaction Processing 800 EFT Transaction Debit Processing & ATM Network Volumes (Mil) 700 • Among the top 10 networks in the US 600 CAGR: 7.3% • Operates nationally with customers based in 26 states and the Virgin Islands; more than 65% of 500 clients outside Oklahoma 400 • Clients: Banks / Credit
Slide 15: Mortgage Banking
Mortgage Banking 160,000 140,000 120,000 100,000 80,000 60,000 • Top 50 U.S. mortgage originator 40,000 20,000 • Two lines of business: - 2016 2017 2018 2019 March 2020 TTM Direct mortgage origination Servicing Rev. Originating and Marketing Rev. through BOKF retail network Mortgage Servicing 25
Slide 16: 1Q 2020 Financial Results
© BOK FINANCIAL 1Q 2020 Financial Results ‘N
Slide 17: First Quarter Summary
First Quarter Summary Net Income $142.2 Q1 Q4 Q1 $137.6 ($mil, exc. EPS) 2020 2019 2019 $110.6 $110.4 Net Income $62.1 $110.4 $110.6 Diluted EPS $0.88 $1.56 $1.54 $1.93 $2.00 $1.54 $1.56 $62.1 Net income before taxes $79.3 $141.0 $140.2 $0.88 Provision for credit losses $93.8 $19.0 $8.0 Pre-provisio
Slide 18: Loan Portfolio
Loan Portfolio Seq. Mar 31, Dec 31, Mar 31, Loan YOY Loan ($mil) 2020 2019 2019 Growth Growth Energy $4,111.7 $3,973.4 $3,705.1 3.5% 11.0% Healthcare 3,165.1 3,033.9 2,915.9 4.3% 8.5% Services 3,955.7 3,832.0 4,090.6 3.2% (3.3)% General business 3,563.5 3,192.3 3,250.3 11.6% 9.6% Total C&I $14,796.0
Slide 19: Net Interest Revenue and Margin
Net Interest Revenue and Margin ($mil) Q1 2020 Q4 2019 Q3 2019 Q2 2019 Q1 2019 Net interest revenue $261.4 $270.2 $279.1 $285.4 $278.1 Net interest margin 2.80% 2.88% 3.01% 3.30% 3.30% Yield on loans 4.50% 4.75% 5.12% 5.39% 5.26% Cost of interest-bearing 0.98% 1.09% 1.17% 1.13% 1.04% deposits Cost o
Slide 20: Fees and Commissions
Fees and Commissions Revenue, $mil Growth: Quarterly, Quarterly, Trailing 12 Q1 2020 Sequential Year over Year Months Brokerage and Trading $50.8 15.8% 60.6% 12.0% Transaction Card 21.9 (3.0)% 5.5% 1.3% Fiduciary and Asset Management 44.5 (1.3)% 2.5% 0.6% Deposit Service Charges and Fees 26.1 (4.4)%
Slide 21: Expenses
Expenses %Incr. %Incr. ($mil) Q1 2020 Q4 2019 Q1 2019 Seq. YOY Personnel expense $156.2 $168.4 $169.2 (7.3)% (7.7)% Other operating expense $112.4 $120.4 $117.9 (6.6)% (4.7)% Total operating expense $268.6 $288.8 $287.2 (7.0)% (6.5)% Efficiency Ratio 58.62% 63.65% 64.80% • Personnel expense down $12
Slide 22: Key Credit Quality Metrics
Key Credit Quality Metrics Non-accruals Net charge-offs (annualized) to average loans $183.8 $181.0 0.40% $172.5 $163.2 $152.6 0.31% 0.22% 0.19% 0.19% 0.20% 0.14% 0.00% 1Q19 2Q19 3Q19 4Q19 1Q20 1Q19 2Q19 3Q19 4Q19 1Q20 Energy Healthcare CRE Residential and Other • Total non-accrual loans down $17.8
Slide 23: CECL
CECL Combined ACL Day 1 Economic Portfolio Combined ACL 12/31/19 Adjustment Factors Changes 03/31/20 $16.0 million $66.2 Changes million due to: Impairments Based on: $49.4* Balances $343.8 Macro million economic Risk Grades million variables Payment Includes ACL Weightings Profiles for loans and as