Bok Financial Corporation · NASDAQ:BOKF
Bok Financial — Investor Presentation (May 2023)
29 slides from Bok Financial's investor presentation, May 2023
Slide 1: Investor Presentation
Investor Presentation May 2023
Slide 2: Forward-looking statements
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 expected or potential
Slide 3: Financial Results Q1 2023
Financial Results Q1 2023 3
Slide 4: Summary Financial Statements
Summary Financial Statements Mar. 31, Dec. 31, Mar. 31, Linked-Quarter Commentary ($Million) 2023 2022 2022 $17,862 $16,885 $22,065 Full quarter impact of $1.5 billion AFS securities purchase in Q4 2022 to move Average Securities toward a neutral rate sensitivity position. $22,476 $21,976 $20,464 Ex
Slide 5: Q1 summary
Q1 summary Noteworthy items impacting profitability Quarterly earnings trend NET INCOME • Net interest revenue was flat linked quarter, with two fewer days in Q1, margin compressed 9 bps as the cost of Attributable to shareholders funds increased faster than earning asset yields, Per share (diluted)
Slide 6: Strong Capital Position
Strong Capital Position Q1 2023 TCE Ratio Including HTM MTM Top tier TCE ratio: Top 20 Banks and BOK Financial • TCE/total assets unadjusted is 8.5% at 3/31/2023, adjusting* AXP for all securities portfolio net losses would reduce this ratio to BOKF 8.2% COF • At 3/31/2023, our 8.2% adjusted TCE met
Slide 7: Securities Portfolio
Securities Portfolio Portfolio Durations Short Duration: • The estimated effective duration of the combined investment -100 Base +100 +300 portfolio (AFS and HTM) is 3.4 years, which extends to 3.6 years in a +200 basis point instantaneous shock indicating AFS 3.0 3.2 3.3 3.5 low levels of extension
Slide 8: Diversified Deposit Portfolio
Diversified Deposit Portfolio Deposits by Business Line Diversified across industries and customers: as of 3/31/2023 • Energy banking is the largest industry concentration at 7% of total deposits • Commercial & Corporate banking comprise a diverse array of industries Insured and collateralized balan
Slide 9: Robust Liquidity and Available Funding
Robust Liquidity and Available Funding Overview: Availability • Total secured borrowing capacity available of $23.7 billion Funding Source ($ billions) • When comparing our uninsured and uncollateralized deposit Excess cash balance at Federal Reserve $ 0.5 amount of $14.2 billion to our "Potential S
Slide 10: Loan portfolio
Loan portfolio Seq. Loan YOY Loan ($Million) Mar. 31, 2023 Dec. 31, 2022 Mar. 31, 2022 Growth Growth • Energy balances were down slightly Energy $3,398.1 $3,424.8 $3,197.7 (0.8)% 6.3% with unfunded commitments up 6.5% Services 3,563.7 3,431.5 3,351.5 3.9% 6.3% • Combined Services & General Healthcar
Slide 11: Yields, rate & margin
Yields, rate & margin Net interest revenue Quarterly Quarterly • Net interest revenue was flat ($Million) Q1 2023 Q4 2022 Q1 2022 sequential YOY linked quarter with two fewer days in Q1; benefit of $1.5 Net interest revenue $352.3 $352.6 $268.4 (0.1)% 31.3% billion increase in earning assets was off
Slide 12: Balanced Interest Rate Risk Position
Balanced Interest Rate Risk Position Scenario* ∆ NIR % ∆ NIR $ Noteworthy balance sheet items Down 200 Ramp, year 1 -2.93% -$40.9 million • During mid-Q4 2022, we added approximately $1.5 billion of securities, which meaningfully balances our interest rate risk position Down 100 Ramp, year 1 -1.90%
Slide 13: Fees & commissions
Fees & commissions Brokerage & trading • Linked quarter decrease due to low Qtr. Seq. Qtr. Seq. Qtr. YOY ($Million) Q1 2023 mortgage originations & trading volumes, $ Change % Change % Change combined with strong syndication fees in Trading fees $27.6 $(8.3) (23.2)% 151.1% the prior quarter Derivati
Slide 14: Expenses
Expenses Expenses summary % Incr. % Incr. • Quarterly personnel expenses ($Million) Q1 2023 Q4 2022 Q1 2022 Seq. YOY decreased 2.3%, primarily due to declines in cash-based comp Personnel expense $182.1 $186.4 $159.2 (2.3)% 14.4% partially offset by annual merit increases and seasonal benefits costs
Slide 15: Key credit quality metrics
Key credit quality metrics Quality metrics summary Net charge-offs to average loans ANNUALIZED • Credit quality better than pre-pandemic level • Trailing 12 months net charge-offs at 7 basis points • $16 million credit provision in Q1; with a combined allowance for credit losses of $312 million or 1
Slide 16: Forecast & assumptions
Forecast & assumptions ◦ We continue to expect mid to upper single digit annualized loan growth. Economic conditions in our geographic footprint remain very strong, and continue to be supported by business in-migration from other markets. Strong growth in unfunded commitments throughout 2022 and cur
Slide 17: BOK Financial Corp
BOK Financial Corp 17
Slide 18: BOK Financial Corporation: Corporate snapshot
NASDAQ: BOKF BOK Financial Corporation CONSUMER, COMMERCIAL & BROKER/DEALER & Corporate snapshot MORTGAGE BANKING INDEPENDENT ADVISORY SERVICES • Top 30 national/regional bank* BOK Financial ® BOK Financial Securities • Midwest/Southwest franchise Bank of Texas BOK Financial Advisors Bank of Albuque
Slide 19: Core strategy
Core strategy Earnings per share CAGR across 30 year history of BOKF is 9.5% Build a bank with diverse revenues that can compete upstream and outperform peers across varying economic cycles. "There is no principle more emphasized in our organization than managing for long-term value rather than shor
Slide 20: Diverse revenue sources
Diverse revenue sources Well diversified Revenue composition as of 3/31/2023 35%-40% of total revenues come from a diverse set of well-established fee income businesses, a differentiator compared to other midsized regional banks. Additional fee income categories: Fiduciary & asset management Brokera
Slide 21: Strong core deposit franchise
Strong core deposit franchise Deposit Branches Deposit mix & cost ($million) Geographic deposit mix MSA share Tulsa, OK 21 31% Demand Interest-bearing transaction Dallas/Fort Worth/Metro, TX 20 2% Savings Time Oklahoma City, OK 15 11% 13% 4% Albuquerque, NM 13 11% Denver/Metro, CO 13 4% 5% 3% 5% 6%
Slide 22: Diversified loan portfolio
Diversified loan portfolio Disciplined concentration management, diversified by sector & geography Loan segmentation Collateral location as of 3/31/2023 as of 3/31/2023 Commercial real estate Texas Loans to individuals Other Services Oklahoma Healthcare Colorado Energy Arizona General business Kansa
Slide 23: Energy banking
Energy banking Portfolio composition More than 100-year history in energy lending as of 3/31/2023 and a 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 Oil & gas pro
Slide 24: Healthcare banking
Healthcare banking Portfolio composition Outstandings totaled $3.9 billion across as of 3/31/2023 35 states at 3/31/2023 Healthcare portfolio characteristics: Senior housing • Favorable spreads Hospitals • Above-average loan utilization rates Service medical • Predominately BOK Financial originated
Slide 25: Commercial real estate
Commercial real estate Portfolio composition as of 3/31/2023 $4.8 billion outstanding and $2.7 billion BY PRODUCT TYPE unfunded commitments at 3/31/2023 Multifamily Office • BOKF allocates 185% of Tier 1 capital plus reserves to CRE. Industrial • Further controls and limitations by product type and
Slide 26: Wealth Management
Wealth Management Wealth Management revenue as of 3/31/2023 Primary lines of business FEE INCOME AND NET INTEREST REVENUE ($Million) • Private Wealth, including banking and investment management • Brokerage & trading services Fee income • Institutional Wealth, including retirement plans, asset and c
Slide 27: Transaction processing
Transaction processing Transaction processing volume as of 12/31/2022 EFT TRANSACTION VOLUMES Debit processing & ATM network (Million) • Operates nationally • More than 72% of clients are outside of Oklahoma • Clients: banks, credit unions and C-store chains • 800 million EFT transactions processed
Slide 28: Mortgage banking
Mortgage banking Mortgage banking revenue as of 3/31/2023 SERVICING, ORIGINATING AND MARKETING REVENUE Top 50 U.S. mortgage originator ($Million) • Annual origination volume in 2022 was $1.1 billion Servicing • Servicing an average of $21.1 billion of mortgages at Originating & marketing March 31, 2
Slide 29: BOK Financial Corporation
BOK FINANCIAL CORPORATION