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 118 full service locations across eight states • Seasoned management team • Proven ability to deliver organic growth September 30, 2020 Assets $46 billion • Consistent execution Loans $24 billion • Consistent strategy D
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 09/30/2020 • Well diversified: no single component of fee income accounts for 15% of total revenue Brokerage and Trading 14% • Further diversity within the
Slide 6: Strong Balance Sheet
Strong Balance Sheet Metric: 09/30/2020 Period End Loans $23.8 billion Period End Deposits $35.0 billion Loan to Deposit Ratio 68.1% Regulatory minimum for Capital Ratios: 09/30/2020 well-capitalized: Common Equity Tier 1 7% 12.07% Tier 1 Capital Ratio 8.5% 12.07% Total Capital Ratio 10.5% 14.05% Le
Slide 7: Strong Core Deposit Franchise
Strong Core Deposit Franchise Deposit mix and cost ($bn) Geographic deposit mix Demand Interest-bearing transaction Savings Time TX $35.0 20% $36 6% 2% NM 6% $30 AR $27.6 1% OK $25.3 53% $24 $22.7 CO $22.1 58% 12% AZ $18 KS/MO 5% 3% $12 MSA Branches Deposit share Tulsa, OK 22 38% Dallas-Fort Worth-A
Slide 8: Diversified Loan Portfolio
Diversified Loan Portfolio Loan Portfolio Segmentation Loan Portfolio by Collateral Location Energy 16% TX 31% Healthcare 14% OK Services 17% 15% NM Loans to 4% PPP Individuals 9% 14% CO Other 13% 22% General Commercial AZ Business Real Estate 8% KS/MO 12% 20% 5% Disciplined concentration management
Slide 9: Energy Banking
Energy Banking Over 100 year history in energy lending and a Portfolio Composition at 09/30/2020 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 09/30/2020 • As of September 30, 2020, outstandings totaled $3.3 billion across 31 states • Healthcare portfolio characteristics: Favorable LIBOR spreads 11% Above-average loan utilization rates Predominately BOK Financial originated 13% Senior Housi
Slide 11: Commercial Real Estate
Commercial Real Estate CRE Portfolio by Product Type Retail Office 17% 23% • $4.7 billion outstanding and $1.3 billion unfunded commitments at September 30, 2020 • BOKF allocates 175% of Tier 1 capital plus Industrial reserves to CRE 17% • Further controls and limitations by product Multifamily type
Slide 12: Wealth Management
Wealth Management Four primary lines of business 600 Wealth Management Revenue • Private Wealth 500 • Brokerage & Trading Services CAGR: 9.6% 400 • Institutional Wealth Management • Cavanal Hill Investment Management 300 • Clients include high net worth individuals, corporations, pensions, 200 found
Slide 13: Wealth Management cont.
Wealth Management cont. Brokerage and Trading Revenue Brokerage & Trading Services 250 CAGR: 11.8% 200 • Institutional Trading and Sales: Institutional investment products and services, including 150 institutional investment guidance, advanced portfolio strategies, taxable and tax-exempt fixed 100 i
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 • Operates nationally with customers based in 26 states and the Virgin Islands; more than 65% of 500 clients outside Oklahoma 400 • Clients: Banks / Credit Unions / C
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 Sept 2020 TTM Direct mortgage origination Servicing Rev. Originating and Marketing Rev. through BOKF retail network Mortgage Servicing 25.
Slide 16: 3Q 2020 Financial Results
© BOK FINANCIAL CORPORATION 3Q 2020 Financial Results ‘N 16
Slide 17: Third Quarter Summary
Third Quarter Summary Net Income $154.0 Q3 Q2 Q3 $142.2 ($mil, exc. EPS) 2020 2020 2019 Net Income $154.0 $64.7 $142.2 $110.4 Diluted EPS $2.19 $0.92 $2.00 $2.19 $2.00 $1.56 $64.7 Net income before taxes $204.6 $80.1 $174.3 $62.1 $0.88 $0.92 Provision for credit losses $— $135.3 $12.0 Pre-provision
Slide 18: Loan Portfolio
Loan Portfolio Seq. Sep 30, June 30, Sep 30, Loan YOY Loan ($mil) 2020 2020 2019 Growth Growth Energy $3,717.1 $3,974.2 $4,114.3 (6.5)% (9.7)% Services 3,545.8 3,779.9 4,011.1 (6.2)% (11.6)% Healthcare 3,325.8 3,289.3 3,033.0 1.1% 9.6% General business 2,977.0 3,115.1 3,266.3 (4.4)% (8.9)% Total C&I
Slide 19: Net Interest Revenue and Margin
Net Interest Revenue and Margin ($mil) Q3 2020 Q2 2020 Q1 2020 Q4 2019 Q3 2019 Net interest revenue $271.8 $278.1 $261.4 $270.2 $279.1 Net interest margin 2.81% 2.83% 2.80% 2.88% 3.01% Yield on loans 3.60% 3.63% 4.50% 4.75% 5.12% Cost of int-bearing deposits 0.26% 0.34% 0.98% 1.09% 1.17% Cost of who
Slide 20: Fees and Commissions
Fees and Commissions Revenue ($mil) Growth: Quarterly, Quarterly, Trailing 12 Q3 2020 Sequential Year over Year Months Brokerage and Trading $69.5 12.1% 58.6% 12.8% Transaction Card 23.5 2.3% 6.6% 1.6% Fiduciary and Asset Management 39.9 (3.2)% (8.5)% (2.1)% Deposit Service Charges and Fees 24.3 10.
Slide 21: Expenses
Expenses %Incr. %Incr. ($mil) Q3 2020 Q2 2020 Q3 2019 Seq. YOY Personnel expense $179.9 $176.2 $162.6 2.1% 10.6% Other operating expense $121.4 $119.2 $116.7 1.9% 4.0% Total operating expense $301.3 $295.4 $279.3 2.0% 7.9% Efficiency Ratio 60.41% 59.57% 59.31% • Personnel expense up only $3.6 millio
Slide 22: Key Credit Quality Metrics
Key Credit Quality Metrics Non-accruals (mil) Net charge-offs (annualized) to average loans $255.4 0.60% $221.2 $181.0 $172.5 $163.2 0.40% 0.37% 0.31% 0.22% 0.23% 0.19% 0.20% 0.00% 3Q19 4Q19 1Q20 2Q20 3Q20 3Q19 4Q19 1Q20 2Q20 3Q20 Energy Healthcare CRE Residential and Other • Net charge-offs increas
Slide 23: COVID-19
COVID-19 Loan Deferrals In Deferral Exited Deferral % of % of # of loans Amount ($mil) segment # of loans Amount ($mil) segment Business Market* 62 $229.4 1.2% 392 $1,312.7 6.6% Individual Market** 294 $34.5 2.1% 378 $36.6 2.2% Total 356 $263.9 1.2% 770 $1,349.3 6.3% * Includes C&I, Energy, Healthca