Bok Financial Corporation · NASDAQ:BOKF
Bok Financial — BOK Financial Corp ET AL — Investor Presentation (November 2018)
24 slides from Bok Financial's investor presentation, Nov 8, 2018
Slide 1: Investor Presentation
Investor Presentation NASDAQ: BOKF 1
Slide 2: Legal Disclaimers
Legal Disclaimers 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 constitu
Slide 3: BOK Financial: A Regional Banking Powerhouse
BOK Financial: A Regional Banking Powerhouse Top 40* US commercial bank Valuable Midwest / Southwest franchise Seasoned management team Proven ability to deliver organic growth Consistent execution Consistent strategy: Sept 30, 2018 NASDAQ: BOKF Assets $33 billion Loans $18 billion C
Slide 4: Core Strategy: Build a recession-proof bank that will outperform peers
Core Strategy: Build a recession-proof bank that will outperform peers across the economic cycle . Consistent organic growth . Robust portfolio of fee generating businesses provides balance in As of 9/30/18 10 Yr. TSR 15 Yr. TSR periods of economic instability BOKF 159% 256% . Differentiated and gro
Slide 5: CoBiz Financial Acquisition Update
CoBiz Financial Acquisition Update • Closed October 1, 2018 -- Only 3.5 months after announcement • Acquisition of a “Best in Class” commercial bank is manifesting itself in both the quality of the people and the client relationships. • Integration teams executing to a conversion date over the March
Slide 6: BOK Financial: Diverse Revenue Sources
BOK Financial: Diverse Revenue Sources • 41% fee income is a differentiator for BOKF compared to other midsized regional banks Brokerage and • Well diversified: no single component of fee Trading income accounts for more than 12% of total 7% revenue Transaction Card 5% • Further diversity within the
Slide 7: Strong Balance Sheet
Strong Balance Sheet Pro-Forma for Metric: At 9/30/18 CoBiz Acquisition Period End Loans $18.3 billion $21.4 billion Period End Deposits $21.6 billion $24.9 billion Loan to Deposit Ratio 85% 86% Regulatory Pro-Forma for Capital Ratios: minimum for At 9/30/18 CoBiz well-capitalized: Acquisition Commo
Slide 8: Strong Core Deposit Franchise
Strong Core Deposit Franchise BOKF CoBiz* Combined* Non-Int. Bearing Non-Int. 42% Bearing MMDA & MMDA & Non-Int. 42% MMDA & Savings Savings Bearing Savings 48% 51% 46% 49% CDs 10% CDs CDs Other 9% 2% 1% Total Deposits = $21.6 bn Total Deposits = $3.3 bn Total Deposits = $24.9 bn MSA Branches Deposit
Slide 9: Diversified Loan Portfolio
Diversified Loan Portfolio Loan Portfolio Segmentation - Standalone Loan Portfolio by Collateral Location - Standalone: Personal 5% Non O-O CRE 21% TX OK 33% Healthcare Resi 20% 13% 11% Energy NM 18% Other 5% Gen. C&I 22% 32% CO AZ 8% 5% KS/MO 7% Loan Portfolio Segmentation – Pro-Forma w/ CoBiz * Lo
Slide 10: A National Energy Banking Leader
A National Energy Banking Leader 100 year history in energy lending and a playbook Portfolio Composition at 9/30/18: that works: . Focus on first lien, senior secured E&P lending – the Oil & Gas “sweet spot” in energy lending Producers . Internal staff of 13 petroleum engineers and 82% engineering t
Slide 11: Healthcare Banking Expertise
Healthcare Banking Expertise . Growing line of business within commercial banking . As of September 30, 2018, outstandings totaled $2.4 billion across 31 states . Healthcare portfolio characteristics: . Favorable LIBOR spreads . Above-average loan utilization rates . Predominately BOK Financial orig
Slide 12: Commercial Real Estate
Commercial Real Estate . $3.8 billion outstanding and $1.4 billion CRE Portfolio by Product Type unfunded commitments at 9/30/18 . Over two-thirds of outstanding collateral within BOKF footprint. Multifamily . BOKF allocates 175% of Tier 1 capital plus Retail reserves to CRE. Office . Further contro
Slide 13: Wealth Management
Wealth Management . Four primary lines of business: 500 Wealth Management Revenue . The Private Bank 400 . BOK Financial Advisors CAGR: 9.8% . Institutional Wealth Management 300 . Cavanal Hill Investment Management 200 . Clients include high net worth individuals, corporations, pensions, foundation
Slide 14: Transaction Processing
Transaction Processing Debit Processing & ATM Network 800 EFT Transaction 700 Volumes (M) . Among the top 10 networks in the US 600 CAGR: 7.2% . Operates nationally with customers based in 26 500 states and the Virgin Islands; more than 65% of 400 clients outside Oklahoma 300 . Clients: Banks / Cred
Slide 15: Mortgage Banking
Mortgage Banking 160,000 . Top 50 U.S. mortgage originator 140,000 120,000 . Three lines of business: 100,000 . Direct mortgage origination through 80,000 BOKF retail network 60,000 . Growing online sales channel – 40,000 HomeDirect Mortgage 20,000 . Mortgage Servicing - 2013 2014 2015 2016 2017 . A
Slide 16: 3Q 2018 Financial Results
© BOK FINANCIAL 3Q 2018 Financial Results 16
Slide 17: Third Quarter Summary
Third Quarter Summary Q3 2018 Q2 2018 Q3 2017 Diluted EPS $1.79 $1.75 $1.31 Net income before taxes $152.2 $148.5 $128.2 Net income attributable to $117.3 $114.4 $85.6 BOKF shareholders Noteworthy items impacting Q3 profitability: • Loan growth remains strong coming off a record-breaking quarter. •
Slide 18: Additional Details
Additional Details Annualized Quarterly Quarterly Year over $billions Q3 2018 Growth Growth Year Growth Period-End Loans $18.3 1.9% 7.7% 6.6% Average Loans $18.2 2.5% 10.2% 5.5% Period-End Deposits $21.6 (2.4)% (9.6)% (1.0)% Average Deposits $21.9 (0.5)% (2.2)% (0.8)% Fiduciary Assets $45.6 (2.1)% (
Slide 19: Loan Portfolio
Loan Portfolio Seq. YOY Sep 30, Jun 30, Sep 30, Loan Loan ($mil) 2018 2018 2017 Growth Growth Energy $ 3,294.9 $ 3,147.2 $ 2,868.0 4.7% 14.9% Services 3,017.3 2,944.5 2,967.5 2.5% 1.7% Healthcare 2,437.3 2,353.7 2,239.5 3.6% 8.8% Wholesale/retail 1,650.7 1,699.6 1,658.1 (2.9)% (0.4)% Manufacturing 6
Slide 20: Net Interest Revenue and Margin
Net Interest Revenue and Margin ($millions) Q3 2018 Q2 2018 Q1 2018 Q4 2017 Q3 2017 Net interest revenue $240.9 $238.6 $219.7 $216.9 $218.5 Net interest margin 3.21% 3.17% 2.99% 2.97% 3.01% Loan Yield 4.80% *4.68% 4.45% 4.29% *4.21% Cost of IB Deposits 0.77% 0.66% 0.57% 0.48% 0.45% • Net interest re
Slide 21: Fees and Commissions Revenue
Fees and Commissions Revenue, $mil Growth: Quarterly, Quarterly, Trailing 12 Q3 2018 Sequential Year over Year Months Brokerage and Trading $23.1 (12.8)% (30.4)% (10.9)% Transaction Card 21.4 2.0% (6.7)% 2.9% Fiduciary and Asset Management 57.5 37.9% 41.4% 17.4% Deposit Service Charges and Fees 27.8
Slide 22: Expenses
Expenses %Incr. %Incr. ($mil) Q3 2018 Q2 2018 Q3 2017 Seq. YOY Personnel expense $143.5 $138.9 $147.9 3.3% (3.0)% Other operating expense $109.1 $107.5 $118.0 1.4% (7.6)% Total operating expense $252.6 $246.5 $265.9 2.5% (5.0)% Efficiency Ratio 61.41% 61.68% 65.92% • Personnel expense up in Q3 from
Slide 23: Key Credit Quality Metrics
Key Credit Quality Metrics Net charge-offs to Average Loans (annualized) 0.40% 0.27% 0.30% 0.24% 0.20% 0.20% 0.08% 0.10% 0.03% 0.00% 3Q17 4Q17 1Q18 2Q18 3Q18 ▪ No material signs of stress in any loan portfolio. ▪ Nonaccrual loans down 7.6 percent sequentially. ▪ Appropriately reserved with a combine
Slide 24: Forecast and Assumptions
Forecast and Assumptions ▪ Continued loan growth as we integrate CoBiz portfolios into our lines of business. ▪ Slowing growth in net interest margin with continued Fed rate increases. ▪ Revenue from fee-generating businesses down due to continued mortgage headwinds. ▪ Controlled expense growth excl
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