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 June 30, 2020 Assets $46 billion • Consistent execution Loans $24 billion • Consistent strategy Deposi
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 9.0% $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 Revenue Composition at 06/30/2020 • Well diversified: no single component of fee income accounts for 15% of total revenue Brokerage and Trading • Further diversity within the fee
Slide 6: Strong Balance Sheet
Strong Balance Sheet Metric: 06/30/2020 Period End Loans $24.2 billion Period End Deposits $33.9 billion Loan to Deposit Ratio 71% Regulatory minimum for Capital Ratios: 06/30/2020 well-capitalized: Common Equity Tier 1 7% 11.41% Tier 1 Capital Ratio 8.5% 11.41% Total Capital Ratio 10.5% 13.39% Leve
Slide 7: Strong Core Deposit Franchise
Strong Core Deposit Franchise Deposit mix and cost ($bn) Geographic deposit mix Demand Interest-bearing transaction Savings Time TX $33.9 21% 7% NM 2% $30 6% $27.6 AR 1% $25.3 OK $24 $22.7 52% $22.1 CO 56% 12% $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 16% TX 31% Healthcare 13% OK Services 18% 16% Loans to NM PPP Individuals 4% 9% 14% Other CO 21% 13% General Commercial AZ Business Real Estate KS/MO 8% 13% 19% 5% Disciplined concentration management
Slide 9: Energy Banking
Energy Banking Over 100 year history in energy lending and a Portfolio Composition at 06/30/2020 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 06/30/2020 • As of June 30, 2020, outstandings totaled $3.3 billion across 31 states • Healthcare portfolio characteristics: Favorable LIBOR spreads 12% Above-average loan utilization rates Predominately BOK Financial originated 14% Senior Housing co
Slide 11: Commercial Real Estate
Commercial Real Estate CRE Portfolio by Product Type Retail 17% Office 21% • $4.6 billion outstanding and $1.3 billion unfunded commitments at June 30, 2020 • BOKF allocates 175% of Tier 1 capital plus reserves to CRE Industrial 16% • Further controls and limitations by product type and geography. C
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 June 2020 TTM Direct mortgage origination Servicing Rev. Originating and Marketing Rev. through BOKF retail network Mortgage Servicing 25.
Slide 16: 2Q 2020 Financial Results
© BOK FINANCIAL CORPORATION 2Q 2020 Financial Results ‘N 16
Slide 17: Second Quarter Summary
Second Quarter Summary Net Income $137.6 $142.2 Q2 Q1 Q2 ($mil, exc. EPS) 2020 2020 2019 $110.4 Net Income $64.7 $62.1 $137.6 Diluted EPS $0.92 $0.88 $1.93 $2.00 $1.93 $1.56 $62.1 $64.7 Net income before taxes $80.1 $79.3 $175.4 $0.88 $0.92 Provision for credit losses $135.3 $93.8 $5.0 Pre-provision
Slide 18: Loan Portfolio
Loan Portfolio Seq. Jun 30, Mar 31, Jun 30, Loan YOY Loan ($mil) 2020 2020 2019 Growth Growth Energy $3,974.2 $4,111.7 $3,921.4 (3.3)% 1.3% Services 3,779.9 3,955.7 4,105.1 (4.4)% (7.9)% Healthcare 3,289.3 3,165.1 2,926.5 3.9% 12.4% General business 3,115.1 3,563.5 3,383.9 (12.6)% (7.9)% Total C&I $
Slide 19: Net Interest Revenue and Margin
Net Interest Revenue and Margin ($millions) Q2 2020 Q1 2020 Q4 2019 Q3 2019 Q2 2019 Net interest revenue $278.1 $261.4 $270.2 $279.1 $285.4 Net interest margin 2.83% 2.80% 2.88% 3.01% 3.30% Yield on loans 3.63% 4.50% 4.75% 5.12% 5.39% Cost of interest-bearing 0.34% 0.98% 1.09% 1.17% 1.13% deposits C
Slide 20: Fees and Commissions
Fees and Commissions Revenue, $mil Growth: Quarterly, Quarterly, Trailing 12 Q2 2020 Sequential Year over Year Months Brokerage and Trading $62.0 22.1% 53.0% 12.0% Transaction Card 22.9 4.8% 4.7% 1.2% Fiduciary and Asset Management 41.3 (7.2)% (8.4)% (2.1)% Deposit Service Charges and Fees 22.0 (15.
Slide 21: Expenses
Expenses %Incr. %Incr. ($mil) Q2 2020 Q1 2020 Q2 2019 Seq. YOY Personnel expense $176.2 $156.2 $160.3 12.8% 9.9% Other operating expense $119.2 $112.4 $116.8 6.0% 2.0% Total operating expense $295.4 $268.6 $277.1 10.0% 6.6% Efficiency Ratio 59.57% 58.62% 59.51% • Personnel expense up $20.1 million s
Slide 22: Key Credit Quality Metrics
Key Credit Quality Metrics Non-accruals Net charge-offs (annualized) to average loans $255.4 0.40% 0.31% $183.8 $181.0 $172.5 $163.2 0.23% 0.22% 0.19% 0.20% 0.14% 0.00% 2Q19 3Q19 4Q19 1Q20 2Q20 2Q19 3Q19 4Q19 1Q20 2Q20 Energy Healthcare CRE Residential and Other • Net charge-offs decreased to 23 bas
Slide 23: ACL
ACL Combined ACL Portfolio Economic Combined ACL 03/31/20 Changes Factors 06/30/20 $54.6 million $70.1 million $468.5 Impairments Macroeconomic million variables Balances Weightings assigned Risk grades based on three $343.8 scenarios Payment profiles million • Combined ACL includes reserves for unf