Market Overview

BOK Financial Reports Record Quarterly Earnings of $114 million or $1.75 Per Share; Results Driven by Strong Loan Growth, Net Interest Margin Expansion, and Continued Expense Control; Quarterly Dividend Increased 11.1 percent to 50 Cents Per Share

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TULSA, Okla., July 25, 2018 (GLOBE NEWSWIRE) -- BOK Financial Corporation (NASDAQ:BOKF) reported net income of $114.4 million or $1.75 per diluted share for the second quarter of 2018. Net income was $105.6 million or $1.61 per diluted share for the first quarter of 2018 and $88.1 million or $1.35 per diluted share for the second quarter of 2017.

Steven G. Bradshaw, president and chief executive officer, stated, "This was a record quarter for BOK Financial, with the highest level of pre–tax, pre–provision income in our company's history. In addition, we saw sustainable momentum across all of our lending businesses, with a record $665 million of new loan production in the quarter and 3.8 percent sequential growth in period end loans outstanding. With continued loan growth and net interest margin expansion, a stable credit environment, and ongoing expense management as we move toward our 60 percent efficiency ratio goal, we see earnings leverage continuing for the foreseeable future. Accordingly, our Board of Directors approved an 11 percent increase in our regular quarterly dividend to 50 cents per share."

Bradshaw continued, "We look forward to closing our acquisition of CoBiz Financial later this year, which we believe will further enhance our growth profile. We believe the combination of CoBiz and BOK Financial will create the premier commercial bank in Colorado and Arizona. In addition, the financial metrics of the deal are highly compelling, as we expect it to be accretive to earnings per share, return on average assets, return on tangible common equity, net interest margin, and efficiency ratio."

 Second Quarter 2018 Highlights

  • Net interest revenue totaled $238.6 million for the second quarter of 2018, growing $18.8 million over the first quarter of 2018. Net interest margin increased to 3.17 percent for the second quarter of 2018 from 2.99 percent for the first quarter of 2018. Recoveries of foregone interest on nonaccruing loans added $5.3 million or 7 basis points to net interest margin in the second quarter. Average earning assets grew by $423 million over the prior quarter.
  • Fees and commissions revenue totaled $157.9 million for the second quarter of 2018, largely unchanged compared to the first quarter of 2018. Modest changes in other revenue lines were offset by decreased brokerage and trading revenue.
  • Operating expense was $246.5 million for the second quarter of 2018, a $2.0 million increase compared to the first quarter of 2018. Personnel expense decreased $1.0 million, primarily due to decreased incentive compensation expense. Non-personnel expense increased $3.0 million including $1.0 million of professional fees associated with the pending CoBiz acquisition.
  • The Company recorded no provision for credit losses in the second quarter of 2018. A $5.0 million negative provision for credit losses was recorded in the first quarter of 2018. The company had net charge-offs of $10.5 million or 0.24 percent of average loans on an annualized basis for second quarter of 2018, compared to net charge-offs of $1.3 million or 0.03 percent of average loans on an annualized basis for the first quarter of 2018. Net charge-offs totaled $26.9 million or 0.16 percent of average loans over the last four quarters.
  • The combined allowance for credit losses totaled $218 million or 1.21 percent of outstanding loans at June 30, 2018, compared to $228 million or 1.32 percent of outstanding loans at March 31, 2018.
  • Nonperforming assets that are not guaranteed by U.S. government agencies totaled $186 million or 1.04 percent of outstanding loans and repossessed assets at June 30, 2018 and $195 million or 1.13 percent of outstanding loans and repossessed assets at March 31, 2018. In addition, potential problem loans decreased $82 million to $140 million at June 30, 2018.
  • Average loan balances grew by $490 million over the previous quarter, primarily due to growth in commercial and commercial real estate loan balances. Period-end outstanding loan balances increased more than $665 million to $18.0 billion at June 30, 2018.
  • Average deposits were largely unchanged compared to the previous quarter. Average interest-bearing transaction deposit balances decreased $155 million, partially offset by an increase in demand deposit balances of $72 million. Period-end deposits were $22.2 billion at June 30, 2018, a $36 million decrease compared to March 31, 2018.
  • The common equity Tier 1 capital ratio at June 30, 2018 was 11.92 percent. Other regulatory capital ratios were Tier 1 capital ratio, 11.92 percent, total capital ratio, 13.26 percent, and leverage ratio, 9.57 percent. At March 31, 2018, the common equity Tier 1 capital ratio was 12.06 percent, the Tier 1 capital ratio was 12.06 percent, total capital ratio was 13.49 percent, and leverage ratio was 9.40 percent.
  • The Company's Board of Directors declared a dividend on the Company's common stock of 50 cents per share. This is an increase of 11.1 percent from 45 cents per share previously. The dividend will be payable on or about August 27, 2018, to shareholders of record on August 13.

Net Interest Revenue

Net interest revenue was $238.6 million for the second quarter of 2018, an $18.8 million increase over the first quarter of 2018.

Net interest margin was 3.17 percent for the second quarter of 2018, an increase of 18 basis points over the first quarter of 2018. Recoveries of foregone interest on nonaccruing loans added $5.3 million or 7 basis points to net interest margin in the second quarter. Excluding the impact of interest recoveries in the second quarter, the yield on average earning assets was 3.84 percent, a 23 basis point increase over the prior quarter. The loan portfolio yield also increased 23 basis points to 4.68 percent. The yield on the available for sale securities portfolio increased 7 basis points to 2.30 percent. The yield on interest-bearing cash and cash equivalents increased 29 basis points. Funding costs were 1.11 percent, up 18 basis points. The cost of interest-bearing deposits increased 9 basis points to 0.66 percent. The cost of other borrowed funds was up 34 basis points to 1.84 percent. The benefit to net interest margin from assets funded by non-interest liabilities increased to 37 basis points from 31 basis points in the first quarter of 2018.

Average earning assets increased $423 million over the second quarter of 2018. Trading securities balances increased $549 million. Average loan balances grew by $490 million. Average interest-bearing cash and cash equivalents balances decreased $386 million. Average fair value option securities held as an economic hedge of our mortgage servicing rights decreased $139 million. Average available for sale securities decreased $74 million. Average interest-bearing deposit balances decreased $144 million compared to the first quarter of 2018. The average balance of borrowed funds increased $231 million.

Fees and Commissions Revenue

Fees and commissions revenue totaled $157.9 million for the second quarter of 2018, consistent with the results from the first quarter of 2018.

Brokerage and trading revenue decreased $4.2 million compared to the first quarter of 2018. Rising mortgage interest rates narrowed trading margins and slowed turnover of our trading inventory. However, the longer average hold time of trading securities increased net interest revenue by $3.1 million.

Other revenue increased $2.2 million compared to the first quarter of 2018 primarily due to appreciation in assets related to the deferred compensation plan. This is primarily offset by an increase in deferred compensation expense. Mortgage banking revenue was relatively consistent with the previous quarter.  A 2 percent decrease in mortgage production volume was offset by an increase in the gain on sale margin.

Operating Expense

Total operating expense was $246.5 million for the second quarter of 2018, largely unchanged compared to the first quarter of 2018.

Personnel expense decreased $1.0 million. Incentive compensation expense decreased $1.0 million. Changes in assumptions for performance-based awards decreased equity compensation expense by $4.3 million. This was partially offset by an increase of $2.4 million in cash based incentive compensation. Employee benefits expense decreased $1.2 million primarily due to a seasonal decrease in payroll taxes partially offset by an overall increase in employee healthcare costs. Regular compensation increased $1.2 million as merit increases were effective for most employees in March 2018.

Non-personnel expense increased $3.0 million. Professional fees and services expense increased $4.8 million mainly due to $1.8 million in project costs, $1.0 million in costs related to the pending CoBiz acquisition and $953 thousand in seasonal tax preparation charges from trust operations. Mortgage banking costs increased $2.7 million primarily due to a $1.9 million increase in accruals related to default servicing and loss mitigation costs on loans serviced for others.

Net losses and operating expenses of repossessed assets decreased $5.0 million, primarily due to a $5.0 million write-down on a set of repossessed oil and gas properties in the first quarter of 2018.

Loans, Deposits and Capital

Loans

Outstanding loans were $18.0 billion at June 30, 2018, up more than $665 million or 3.8 percent over March 31, 2018. Loan growth can generally be attributed to tax reform changes and regulatory easing resulting in a better overall business environment. Specifically, growth in energy loans is consistent with our ongoing support and commitment to the oil and gas industry.

Outstanding commercial loan balances grew by $429 million or 3.9 percent over March 31, 2018. Energy loan balances were up $178 million. Unfunded energy loan commitments increased $80 million over March 31, 2018 to $3.0 billion at June 30, 2018. Wholesale/retail sector loan balances grew by $168 million. Manufacturing sector loan balances were up $88 million. Service sector loans increased $16 million, mostly offset by a $14 million decrease in other commercial and industrial loans.

Commercial real estate loan balances grew by $205 million or 5.9 percent over March 31, 2018. Loans secured by office buildings increased $83 million. Multifamily residential loan balances were up $48 million. Loans secured by industrial properties grew by $40 million. Loans secured by retail facilities and other commercial real estate loans increased $18 million and $15 million, respectively.

Deposits

Period-end deposits totaled $22.2 billion at June 30, 2018, a $36 million decrease compared to March 31, 2018. Interest-bearing transaction account balances decreased $63 million and time deposit balances decreased by $39 million. These decreases were partially offset by a $68 million increase in demand deposit balances. Consumer Banking deposits were down $71 million and Commercial Banking deposits decreased $41 million, partially offset by a $7.3 million increase in Wealth Management deposits.

Capital

The company's common equity Tier 1 capital ratio was 11.92 percent at June 30, 2018. In addition, the company's Tier 1 capital ratio was 11.92 percent, total capital ratio was 13.26 percent, and leverage ratio was 9.57 percent at June 30, 2018. At March 31, 2018, the company's common equity Tier 1 capital ratio was 12.06 percent, Tier 1 capital ratio was 12.06 percent, total capital ratio was 13.49 percent, and leverage ratio was 9.40 percent.

The decrease in regulatory capital ratios was due in part to introduction of the market risk capital rules. The company exceeded the $1 billion regulatory capital rules threshold for trading assets and liabilities at March 31. This subjects the company to the market risk rule, which imposed additional modeling, systems, oversight and reporting requirements beginning in the second quarter of 2018 and resulted in an increase in risk weighted assets associated with our trading activities.

The company's tangible common equity ratio, a non-GAAP measure, was 9.21 percent at June 30, 2018 and 9.18 percent at March 31, 2018. The tangible common equity ratio is primarily based on total shareholders' equity, which includes unrealized gains and losses on available for sale securities. The company has elected to exclude unrealized gains and losses from available for sale securities from its calculation of Tier 1 capital for regulatory capital purposes, consistent with the treatment under the previous capital rules.

Credit Quality

Nonperforming assets totaled $269 million or 1.49 percent of outstanding loans and repossessed assets at June 30, 2018, down from $278 million or 1.60 percent at March 31, 2018. Nonperforming assets that are not guaranteed by U.S. government agencies totaled $186 million or 1.04 percent of outstanding loans and repossessed assets (excluding those guaranteed by U.S. government agencies) at June 30, 2018, compared to $195 million or 1.13 percent at March 31, 2018.

Nonaccruing loans were $166 million or 0.92 percent of outstanding loans at June 30, 2018, compared to $180 million or 1.04 percent of outstanding loans at March 31, 2018. The decrease in nonaccruing loans was primarily due to a $24 million decrease in energy loans, partially offset by a $12 million increase in wholesale/retail sector loans. New nonaccruing loans identified in the second quarter totaled $42 million, offset by $31 million in payments received, $15 million in charge-offs and $8.2 million in foreclosures and repossessions. At June 30, 2018, nonaccruing commercial loans totaled $121 million or 1.07 percent of outstanding commercial loans, nonaccruing commercial real estate loans totaled $2.0 million or 0.05 percent of outstanding commercial real estate loans and nonaccruing residential mortgage loans totaled $42 million or 2.18 percent of outstanding residential mortgage loans.

Potential problem loans, which are defined as performing loans that, based on known information, cause management concern as to the borrowers' ability to continue to perform, totaled $140 million at June 30, down from $222 million at March 31. The decrease largely resulted from energy, services, and wholesale/retail sector loans.

The company had net charge-offs of $10.5 million or 0.24 percent of average loans on an annualized basis for second quarter of 2018, compared to net charge-offs of $1.3 million or 0.03 percent of average loans on an annualized basis for the first quarter of 2018. Net charge-offs were 0.16 percent of average loans over the last four quarters. Over half of the second quarter net charge-offs was from one energy loan that had previously been identified as impaired and appropriately reserved. Gross charge-offs were $15.1 million for the second quarter compared to $2.9 million for the previous quarter. Recoveries totaled $4.6 million for the second quarter of 2018 and $1.6 million for the first quarter of 2018.

Based on an evaluation of all credit factors, including overall loan portfolio growth, changes in nonaccruing and potential problem loans and net charge-offs, the company determined that no provision for credit losses was appropriate for the second quarter of 2018. The company had a $5.0 million negative provision for credit losses in the first quarter of 2018.

The combined allowance for credit losses totaled $218 million or 1.21 percent of outstanding loans and 138 percent of nonaccruing loans at June 30, 2018, excluding residential mortgage loans guaranteed by U.S. government agencies. The allowance for loan losses was $215 million and the accrual for off-balance sheet credit losses was $2.4 million. At March 31, 2018, the combined allowance for credit losses was $228 million or 1.32 percent of outstanding loans and 133 percent of nonaccruing loans, excluding loans guaranteed by U.S. government agencies. The allowance for loan losses was $224 million and the accrual for off-balance sheet credit losses was $4.1 million.

Securities and Derivatives

The fair value of the available for sale securities portfolio totaled $8.2 billion at June 30, 2018, an $87 million decrease compared to March 31, 2018. At June 30, 2018, the available for sale portfolio consisted primarily of $5.3 billion of residential mortgage-backed securities fully backed by U.S. government agencies and $2.7 billion of commercial mortgage-backed securities fully backed by U.S. government agencies. At June 30, 2018, the available for sale securities portfolio had a net unrealized loss of $181 million compared to a $148 million net unrealized loss at March 31, 2018.

Trading securities increased $617 million to $1.9 billion during the second quarter of 2018 as a result of expanded relationships with mortgage loan originator clients along with slower inventory turnover rates. The company holds an inventory of trading securities in support of sales to a variety of customers, including banks, corporations, insurance companies, money managers, and others.

The company also maintains a portfolio of residential mortgage-backed securities issued by U.S. government agencies and interest rate derivative contracts as an economic hedge of the changes in the fair value of our mortgage servicing rights.

The net economic cost of the changes in fair value of mortgage servicing rights and related economic hedges was $3.5 million during the second quarter of 2018, including a $1.7 million increase in the fair value of mortgage servicing rights, a $6.4 million decrease in the fair value of securities and derivative contracts held as an economic hedge, and $1.2 million of related net interest revenue.

The fair value of mortgage servicing rights increased by $21.2 million during the first quarter of 2018.  The fair value of securities and interest rate derivative contracts held as an economic hedge of mortgage servicing rights decreased by $23.3 million. Related net interest revenue was $1.8 million during the first quarter of 2018.

Conference Call and Webcast

The company will hold a conference call at 9 a.m. Central time on Wednesday, July 25, 2018 to discuss the financial results with investors. The live audio webcast and presentation slides will be available on the company's website at www.bokf.com. The conference call can also be accessed by dialing 1-201-689-8471. A conference call and webcast replay will also be available shortly after conclusion of the live call at www.bokf.com or by dialing 1-412-317-6671 and referencing conference ID # 13681367.

About BOK Financial Corporation

BOK Financial Corporation is a $34 billion regional financial services company based in Tulsa, Oklahoma. The company's stock is publicly traded on NASDAQ under the Global Select market listings (symbol: BOKF). BOK Financial's holdings include BOKF, NA, BOK Financial Securities, Inc. and The Milestone Group, Inc. BOKF, NA operates TransFund, Cavanal Hill Investment Management, BOK Financial Asset Management, Inc. and seven banking divisions: Bank of Albuquerque, Bank of Arizona, Bank of Arkansas, Mobank, Bank of Oklahoma, Bank of Texas and Colorado State Bank and Trust. Through its subsidiaries, the company provides commercial and consumer banking, investment and trust services, mortgage origination and servicing, and an electronic funds transfer network. For more information, visit www.bokf.com.

The company will continue to evaluate critical assumptions and estimates, such as the appropriateness of the allowance for credit losses and asset impairment as of June 30, 2018 through the date its financial statements are filed with the Securities and Exchange Commission and will adjust amounts reported if necessary.

This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 including, but not limited to, CoBiz Financial Inc.'s and BOK Financial Corporation's expectations or predictions of future financial or business performance or conditions. Forward-looking statements are typically identified by words such as "believe," "expect," "anticipate," "intend," "target," "estimate," "continue," "positions," "plan," "predict," "project," "forecast," "guidance," "goal," "objective," "prospects," "possible" or "potential," by future conditional verbs such as "assume," "will," "would," "should," "could" or "may", or by variations of such words or by similar expressions. These forward-looking statements are subject to numerous assumptions, risks and uncertainties, which change over time. Forward-looking statements speak only as of the date they are made and we assume no duty to update forward-looking statements. Actual results may differ materially from current projections.

In addition to factors previously disclosed in CoBiz Financial Inc.'s and BOK Financial Corporation's reports filed with the SEC and those identified elsewhere in this communication, the following factors, among others, could cause actual results to differ materially from forward-looking statements or historical performance: the ability to obtain regulatory approvals and meet other closing conditions to the merger, including approval by CoBiz Financial Inc.'s shareholders on the expected terms and schedule, including the risk that regulatory approvals required for the merger are not obtained or are obtained subject to conditions that are not anticipated; delay in closing the merger; difficulties and delays in integrating CoBiz Financial Inc.'s business or fully realizing cost savings and other benefits; business disruption following the merger; changes in asset quality and credit risk; the inability to sustain revenue and earnings growth; changes in interest rates and capital markets; inflation; customer acceptance of BOK Financial Corporation's products and services; customer borrowing, repayment, investment and deposit practices; customer disintermediation; the introduction, withdrawal, success and timing of business initiatives; competitive conditions; the inability to realize cost savings or revenues or to implement integration plans and other consequences associated with mergers, acquisitions and divestitures; economic conditions; and the impact, extent and timing of technological changes, capital management activities, and other actions of the Federal Reserve Board and legislative and regulatory actions and reforms.

Annualized, pro forma, projected and estimated numbers are used for illustrative purpose only, are not forecasts and may not reflect actual results.

In this news release we may sometimes use non-GAAP Financial information.  Please note that although non-GAAP financial measures provide useful insight to analysts, investors and regulators, they should not be considered in isolation or relied upon as a substitute for analysis using GAAP measures.  If applicable, we provide GAAP reconciliations for non-GAAP financial measures.

IMPORTANT ADDITIONAL INFORMATION AND WHERE TO FIND IT

In connection with the proposed merger, BOK Financial Corporation has filed with the SEC a Registration Statement on Form S-4 that will include the Proxy Statement of CoBiz Financial Inc. and a Prospectus of BOK Financial Corporation, as well as other relevant documents concerning the proposed transaction. This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval. INVESTORS AND SHAREHOLDERS ARE URGED TO READ THE REGISTRATION STATEMENT AND THE PROXY STATEMENT/PROSPECTUS REGARDING THE MERGER E AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THOSE DOCUMENTS, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION.

A free copy of the Proxy Statement/Prospectus, as well as other filings containing information about BOK Financial Corporation and CoBiz Financial Inc., may be obtained at the SEC's Internet site (http://www.sec.gov). You will also be able to obtain these documents, free of charge, from CoBiz Financial Inc. at ir.cobizfinancial.com or from BOK Financial Corporation by accessing BOK Financial Corporation's website at www.bokf.com. Copies of the Proxy Statement/Prospectus can also be obtained, free of charge, by directing a request to CoBiz Financial Inc. Investor Relations at CoBiz Financial Inc. Investor Relations, 1401 Lawrence Street, Suite 1200, Denver, CO, by calling (303) 312-3412, or by sending an e-mail to info@cobizfinancial.com or to BOK Financial Corporation Investor Relations at Bank of Oklahoma Tower, Boston Avenue at Second Street, Tulsa, Oklahoma, by calling (918) 588-6000 or by sending an e-mail to investorrelations@bokf.com.

CoBiz Financial Inc. and BOK Financial Corporation and certain of their respective directors and executive officers may be deemed to be participants in the solicitation of proxies from the shareholders of CoBiz Financial Inc. in respect of the transaction described in the Proxy Statement/Prospectus. Information regarding CoBiz Financial Inc.'s directors and executive officers is contained in CoBiz Financial Inc.'s Annual Report on Form 10-K for the year ended December 31, 2017 and its Proxy Statement on Schedule 14A, dated March 9, 2018, which are filed with the SEC.  Information regarding BOK Financial Corporation's directors and executive officers is contained in BOK Financial Corporation's Annual Report on Form 10-K for the year ended December 31, 2017 and its Proxy Statement on Schedule 14A, dated March 15, 2018, which are filed with the SEC. Additional information regarding the interests of those participants and other persons who may be deemed participants in the transaction may be obtained by reading the Proxy Statement/Prospectus regarding the proposed merger when it becomes available. Free copies of this document may be obtained as described in the preceding paragraph.


BALANCE SHEETS -- UNAUDITED
BOK FINANCIAL CORPORATION
(In thousands)
  June 30, 2018   Mar. 31, 2018   June 30, 2017
ASSETS          
Cash and due from banks $ 585,801     $ 544,534     $ 561,587  
Interest-bearing cash and cash equivalents 872,999     2,054,899     2,078,831  
Trading securities 1,909,615     1,292,432     441,414  
Investment securities 392,013     416,672     490,426  
Available for sale debt securities 8,162,866     8,249,432     8,341,041  
Fair value option securities 482,227     513,668     445,169  
Restricted equity securities 347,721     338,552     311,033  
Residential mortgage loans held for sale 223,301     225,190     287,259  
Loans:          
Commercial 11,349,039     10,919,667     10,637,955  
Commercial real estate 3,712,220     3,506,782     3,688,592  
Residential mortgage 1,942,250     1,945,769     1,939,198  
Personal 1,000,187     965,632     917,900  
Total loans 18,003,696     17,337,850     17,183,645  
Allowance for loan losses (215,142 )   (223,967 )   (250,061 )
Loans, net of allowance 17,788,554     17,113,883     16,933,584  
Premises and equipment, net 320,810     314,347     321,038  
Receivables 212,893     206,577     170,094  
Goodwill 453,093     447,430     446,697  
Intangible assets, net 28,273     29,658     40,755  
Mortgage servicing rights 278,719     274,978     245,239  
Real estate and other repossessed assets, net 27,891     23,652     39,436  
Derivative contracts, net 373,373     286,687     280,289  
Cash surrender value of bank-owned life insurance 321,024     318,661     312,774  
Receivable on unsettled securities sales 604,552     275,088     158,125  
Other assets 447,382     435,152     358,741  
TOTAL ASSETS $ 33,833,107     $ 33,361,492     $ 32,263,532  
           
LIABILITIES AND EQUITY          
Deposits:          
Demand $ 9,373,959     $ 9,306,023     $ 9,568,895  
Interest-bearing transaction 10,164,099     10,226,971     10,087,139  
Savings 503,474     505,952     464,318  
Time 2,127,732     2,166,254     2,196,122  
Total deposits 22,169,264     22,205,200     22,316,474  
Funds purchased and repurchase agreements 880,027     546,324     464,323  
Other borrowings 5,929,445     5,727,025     5,232,343  
Subordinated debentures 144,697     144,687     144,658  
Accrued interest, taxes and expense 160,568     156,146     133,198  
Due on unsettled securities purchases 571,034     553,840     31,214  
Derivative contracts, net 234,856     233,202     285,819  
Other liabilities 167,171     277,726     205,958  
TOTAL LIABILITIES 30,257,062     29,844,150     28,813,987  
Shareholders' equity:          
Capital, surplus and retained earnings 3,688,736     3,606,220     3,414,505  
Accumulated other comprehensive gain (loss)
(135,305 )   (111,191 )   7,964  
TOTAL SHAREHOLDERS' EQUITY 3,553,431     3,495,029     3,422,469  
Non-controlling interests 22,614     22,313     27,076  
TOTAL EQUITY 3,576,045     3,517,342     3,449,545  
TOTAL LIABILITIES AND EQUITY $ 33,833,107     $ 33,361,492     $ 32,263,532  


AVERAGE BALANCE SHEETS -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands)
  Three Months Ended
  June 30, 2018   Mar. 31, 2018   Dec. 31, 2017   Sept. 30, 2017   June 30, 2017
ASSETS                  
Interest-bearing cash and cash equivalents $ 1,673,387     $ 2,059,517     $ 1,976,395     $ 1,965,645     $ 2,007,746  
Trading securities 1,482,302     933,404     560,321     491,613     456,028  
Investment securities 399,088     441,207     462,869     475,705     499,372  
Available for sale debt securities 8,163,142     8,236,938     8,435,916     8,428,353     8,384,057  
Fair value option securities 487,192     626,251     792,647     684,571     476,102  
Restricted equity securities 348,546     349,176     337,673     328,677     295,743  
Residential mortgage loans held for sale 218,600     199,380     257,927     256,343     245,401  
Loans:                  
Commercial 11,189,899     10,871,569     10,751,235     10,827,198     10,604,456  
Commercial real estate 3,660,166     3,491,335     3,485,583     3,528,330     3,676,976  
Residential mortgage 1,915,015     1,937,198     1,976,860     1,951,385     1,933,091  
Personal 986,162     961,379     967,329     949,750     915,010  
Total loans 17,751,242     17,261,481     17,181,007     17,256,663     17,129,533  
Allowance for loan losses (222,856 )   (228,996 )   (246,143 )   (250,590 )   (251,632 )
Total loans, net 17,528,386     17,032,485     16,934,864     17,006,073     16,877,901  
Total earning assets 30,300,643     29,878,358     29,758,612     29,636,980     29,242,350  
Cash and due from banks 571,333     564,585     576,737     546,653     530,352  
Derivative contracts, net 318,375     278,694     292,961     238,583     248,168  
Cash surrender value of bank-owned life insurance 319,507     317,334     315,034     313,079     311,310  
Receivable on unsettled securities sales 618,240     998,803     821,275     608,412     372,894  
Other assets 1,777,937     1,687,178     1,687,496     1,664,463     1,663,497  
TOTAL ASSETS $ 33,906,035     $ 33,724,952     $ 33,452,115     $ 33,008,170     $ 32,368,571  
                   
LIABILITIES AND EQUITY                  
Deposits:                  
Demand $ 9,223,327     $ 9,151,272     $ 9,417,351     $ 9,389,849     $ 9,338,683  
Interest-bearing transaction 10,189,354     10,344,469     10,142,744     10,088,522     10,087,640  
Savings 503,671     480,110     466,496     464,130     461,586  
Time 2,138,880     2,151,044     2,134,469     2,176,820     2,204,422  
Total deposits 22,055,232     22,126,895     22,161,060     22,119,321     22,092,331  
Funds purchased and repurchase agreements 593,250     532,412     488,330     411,286     490,616  
Other borrowings 6,497,020     6,326,967     6,209,903     6,162,641     5,572,031  
Subordinated debentures 144,692     144,682     144,673     144,663     144,654  
Derivative contracts, net 235,543     223,373     288,408     221,371     178,695  
Due on unsettled securities purchases 527,804     558,898     332,155     145,977     162,348  
Other liabilities 340,322     333,151     312,196     318,270     318,463  
TOTAL LIABILITIES 30,393,863     30,246,378     29,936,725     29,523,529     28,959,138  
Total equity 3,512,172     3,478,574     3,515,390     3,484,641     3,409,433  
TOTAL LIABILITIES AND EQUITY $ 33,906,035     $ 33,724,952     $ 33,452,115     $ 33,008,170     $ 32,368,571  


STATEMENTS OF EARNINGS -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands, except per share data)
  Three Months Ended   Six Months Ended
  June 30,   June 30,
  2018   2017   2018   2017
               
Interest revenue $ 294,180     $ 235,181     $ 559,587     $ 461,571  
Interest expense 55,618     29,977     101,289     55,185  
Net interest revenue 238,562     205,204     458,298     406,386  
Provision for credit losses         (5,000 )    
Net interest revenue after provision for credit losses 238,562     205,204     463,298     406,386  
Other operating revenue:              
Brokerage and trading revenue 26,488     31,764     57,136     65,387  
Transaction card revenue1 20,975     20,009     41,965     38,186  
Fiduciary and asset management revenue 41,699     41,808     83,531     80,439  
Deposit service charges and fees 27,827     28,422     54,988     56,199  
Mortgage banking revenue 26,346     30,276     52,371     55,467  
Other revenue 14,518     14,984     26,848     26,736  
Total fees and commissions 157,853     167,263     316,839     322,414  
Other gains, net 3,983     6,108     3,319     9,735  
Gain (loss) on derivatives, net (3,057 )   3,241     (8,742 )   2,791  
Gain (loss) on fair value option securities, net (3,341 )   1,984     (20,905 )   844  
Change in fair value of mortgage servicing rights 1,723     (6,943 )   22,929     (5,087 )
Gain (loss) on available for sale securities, net (762 )   380     (1,052 )   2,429  
Total other operating revenue 156,399     172,033     312,388     333,126  
Other operating expense:              
Personnel 138,947     143,744     278,894     280,169  
Business promotion 7,686     7,738     13,696     14,455  
Professional fees and services 14,978     12,419     25,178     23,836  
Net occupancy and equipment 22,761     21,125     46,807     42,749  
Insurance 6,245     689     12,838     7,093  
Data processing and communications1 27,739     26,111     55,556     51,810  
Printing, postage and supplies 4,011     4,140     8,100     7,991  
Net losses and operating expenses of repossessed assets 2,722     2,267     10,427     3,276  
Amortization of intangible assets 1,386     1,803     2,686     3,605  
Mortgage banking costs 12,890     12,072     23,039     25,075  
Other expense 7,111     8,558     13,685     16,115  
Total other operating expense 246,476     240,666     490,906     476,174  
               
Net income before taxes 148,485     136,571     284,780     263,338  
Federal and state income taxes 33,330     47,705     64,278     85,808  
               
Net income 115,155     88,866     220,502     177,530  
Net income attributable to non-controlling interests 783     719     568     1,027  
Net income attributable to BOK Financial Corporation shareholders $ 114,372     $ 88,147     $ 219,934     $ 176,503  
               
Average shares outstanding:              
Basic 64,901,975     64,729,752     64,874,567     64,722,744  
Diluted 64,937,226     64,793,134     64,912,552     64,788,322  
               
Net income per share:              
Basic $ 1.75     $ 1.35     $ 3.36     $ 2.70  
Diluted $ 1.75     $ 1.35     $ 3.36     $ 2.69  

1 Non-GAAP measure to net interchange charges for periods prior to 2018 between transaction card revenue and data processing and communications expense. This measure has no effect on net income or earnings per share.


FINANCIAL HIGHLIGHTS -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands, except ratio and share data)
  Three Months Ended
  June 30, 2018   Mar. 31, 2018   Dec. 31, 2017   Sept. 30, 2017   June 30, 2017
Capital:                  
Period-end shareholders' equity $ 3,553,431     $ 3,495,029     $ 3,495,367     $ 3,488,814     $ 3,422,469  
Risk weighted assets $ 27,004,559     $ 26,025,660     $ 25,733,711     $ 25,409,728     $ 25,130,802  
Risk-based capital ratios:                  
Common equity tier 1 11.92 %   12.06 %   12.05 %   11.90 %   11.76 %
Tier 1 11.92 %   12.06 %   12.05 %   11.90 %   11.76 %
Total capital 13.26 %   13.49 %   13.54 %   13.47 %   13.36 %
Leverage ratio 9.57 %   9.40 %   9.31 %   9.30 %   9.27 %
Tangible common equity ratio1 9.21 %   9.18 %   9.50 %   9.23 %   9.24 %
                   
Common stock:                  
Book value per share $ 54.30     $ 53.39     $ 53.45     $ 53.30     $ 52.32  
Tangible book value per share 46.95     46.10     46.17     45.88     44.87  
Market value per share:                  
High $ 106.65     $ 107.00     $ 93.97     $ 90.69     $ 88.31  
Low $ 92.39     $ 89.82     $ 79.67     $ 77.10     $ 74.09  
Cash dividends paid $ 29,340     $ 29,342     $ 29,328     $ 28,655     $ 28,652  
Dividend payout ratio 25.65 %   27.80 %   40.46 %   33.46 %   32.50 %
Shares outstanding, net 65,439,090     65,459,505     65,394,937     65,456,786     65,416,403  
Stock buy-back program:                  
Shares repurchased 8,257     82,583     80,000          
Amount $ 824     $ 7,584     $ 7,403     $     $  
Average price per share $ 99.84     $ 91.83     $ 92.54     $     $  
                   
Performance ratios (quarter annualized):
Return on average assets 1.35 %   1.27 %   0.86 %   1.03 %   1.09 %
Return on average equity 13.14 %   12.39 %   8.24 %   9.83 %   10.46 %
Net interest margin 3.17 %   2.99 %   2.97 %   3.01 %   2.89 %
Efficiency ratio3 61.68 %   65.09 %   66.07 %   65.92 %   63.66 %
                   
Reconciliation of non-GAAP measures:
1     Tangible common equity ratio:                  
Total shareholders' equity $ 3,553,431     $ 3,495,029     $ 3,495,367     $ 3,488,814     $ 3,422,469  
Less: Goodwill and intangible assets, net 481,366     477,088     476,088     485,710     487,452  
Tangible common equity $ 3,072,065     $ 3,017,941     $ 3,019,279     $ 3,003,104     $ 2,935,017  
                   
Total assets $ 33,833,107     $ 33,361,492     $ 32,272,160     $ 33,005,515     $ 32,263,532  
Less: Goodwill and intangible assets, net 481,366     477,088     476,088     485,710     487,452  
Tangible assets $ 33,351,741     $ 32,884,404     $ 31,796,072     $ 32,519,805     $ 31,776,080  
                   
Tangible common equity ratio 9.21 %   9.18 %   9.50 %   9.23 %   9.24 %
                   
Other data:                  
Fiduciary assets $ 46,531,900     $ 46,648,290     $ 48,761,477     $ 45,177,185     $ 45,089,153  
Tax equivalent interest $ 1,983     $ 2,010     $ 4,131     $ 4,314     $ 4,330  
Net unrealized gain (loss) on available for sale securities $ (180,602 )   $ (148,247 )   $ (47,497 )   $ 14,061     $ 16,041  
                   
Mortgage banking:                  
Mortgage production revenue $ 9,915     $ 9,452     $ 7,786     $ 8,329     $ 13,840  
                   
Mortgage loans funded for sale $ 773,910     $ 664,958     $ 840,080     $ 832,796     $ 902,978  
Add: current period-end outstanding commitments 251,231     298,318     222,919     334,337     362,088  
Less: prior period end outstanding commitments 298,318     222,919     334,337     362,088     381,732  
Total mortgage production volume $ 726,823     $ 740,357     $ 728,662     $ 805,045     $ 883,334  
                   
Mortgage loan refinances to mortgage loans funded for sale 22 %   42 %   47 %   38 %   33 %
Gain on sale margin 1.36 %   1.28 %   1.07 %   1.03 %   1.57 %
                   
Mortgage servicing revenue $ 16,431     $ 16,573     $ 16,576     $ 16,561     $ 16,436  
Average outstanding principal balance of mortgage loans serviced for others 21,986,065     22,027,726     22,054,877     22,079,177     22,055,127  
Average mortgage servicing revenue rates 0.30 %   0.31 %   0.30 %   0.30 %   0.30 %
                   
Gain (loss) on mortgage servicing rights, net of economic hedge:
Gain (loss) on mortgage hedge derivative contracts, net $ (3,070 )   $ (5,698 )   $ (3,057 )   $ 1,025     $ 3,241  
Gain (loss) on fair value option securities, net (3,341 )   (17,564 )   (4,238 )   661     1,984  
Gain (loss) on economic hedge of mortgage servicing rights (6,411 )   (23,262 )   (7,295 )   1,686     5,225  
Gain (loss) on changes in fair value of mortgage servicing rights 1,723     21,206     5,898     (639 )   (6,943 )
Gain (loss) on changes in fair value of mortgage servicing rights, net of economic hedges, included in other operating revenue (4,688 )   (2,056 )   (1,397 )   1,047     (1,718 )
Net interest revenue on fair value option securities2 1,203     1,800     2,656     2,543     1,965  
Total economic benefit (cost) of changes in the fair value of mortgage servicing rights, net of economic hedges $ (3,485 )   $ (256 )   $ 1,259     $ 3,590     $ 247  

2    Actual interest earned on fair value option securities less internal transfer-priced cost of funds.
3    Periods prior to 2018 are shown on a comparable basis to net interchange charges between transaction card revenue and data processing and communications expense.


QUARTERLY EARNINGS TREND -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands, except ratio and per share data)
  Three Months Ended
  June 30, 2018   Mar. 31, 2018   Dec. 31, 2017   Sept. 30, 2017   June 30, 2017
                   
Interest revenue $ 294,180     $ 265,407     $ 255,767     $ 255,413     $ 235,181  
Interest expense 55,618     45,671     38,904     36,961     29,977  
Net interest revenue 238,562     219,736     216,863     218,452     205,204  
Provision for credit losses     (5,000 )   (7,000 )        
Net interest revenue after provision for credit losses 238,562     224,736     223,863     218,452     205,204  
Other operating revenue:                  
Brokerage and trading revenue 26,488     30,648     33,045     33,169     31,764  
Transaction card revenue1 20,975     20,990     20,028     22,929     20,009  
Fiduciary and asset management revenue 41,699     41,832     41,767     40,687     41,808  
Deposit service charges and fees 27,827     27,161     27,685     28,191     28,422  
Mortgage banking revenue 26,346     26,025     24,362     24,890     30,276  
Other revenue 14,518     12,330     11,762     13,670     14,984  
Total fees and commissions 157,853     158,986     158,649     163,536     167,263  
Other gains (losses), net 3,983     (664 )   552     (1,283 )   6,108  
Gain (loss) on derivatives, net (3,057 )   (5,685 )   (3,045 )   1,033     3,241  
Gain (loss) on fair value option securities, net (3,341 )   (17,564 )   (4,238 )   661     1,984  
Change in fair value of mortgage servicing rights 1,723     21,206     5,898     (639 )   (6,943 )
Gain (loss) on available for sale securities, net (762 )   (290 )   (488 )   2,487     380  
Total other operating revenue 156,399     155,989     157,328     165,795     172,033  
Other operating expense:                  
Personnel 138,947     139,947     145,329     147,910     143,744  
Business promotion 7,686     6,010     7,317     7,105     7,738  
Charitable contributions to BOKF Foundation         2,000          
Professional fees and services 14,978     10,200     15,344     11,887     12,419  
Net occupancy and equipment 22,761     24,046     22,403     21,325     21,125  
Insurance 6,245     6,593     6,555     6,005     689  
Data processing and communications1 27,739     27,817     28,903     27,412     26,111  
Printing, postage and supplies 4,011     4,089     3,781     3,917     4,140  
Net losses (gains) and operating expenses of repossessed assets 2,722     7,705     340     6,071     2,267  
Amortization of intangible assets 1,386     1,300     1,430     1,744     1,803  
Mortgage banking costs 12,890     10,149     14,331     13,450     12,072  
Other expense 7,111     6,574     6,746     9,193     8,558  
Total other operating expense 246,476     244,430     254,479     256,019     240,666  
Net income before taxes 148,485     136,295     126,712     128,228     136,571  
Federal and state income taxes 33,330     30,948     54,347     42,438     47,705  
Net income 115,155     105,347     72,365     85,790     88,866  
Net income (loss) attributable to non-controlling interests 783     (215 )   (127 )   141     719  
Net income attributable to BOK Financial Corporation shareholders $ 114,372     $ 105,562     $ 72,492     $ 85,649     $ 88,147  
                   
Average shares outstanding:                  
Basic 64,901,975     64,847,334     64,793,005     64,742,822     64,729,752  
Diluted 64,937,226     64,888,033     64,843,179     64,805,172     64,793,134  
Net income per share:                  
Basic $ 1.75     $ 1.61     $ 1.11     $ 1.31     $ 1.35  
Diluted $ 1.75     $ 1.61     $ 1.11     $ 1.31     $ 1.35  

1    Non-GAAP measure to net interchange charges for periods prior to 2018 between transaction card revenue and data processing and communications expense. This measure has no effect on net income or earnings per share.


LOANS TREND -- UNAUDITED
BOK FINANCIAL CORPORATION
(In thousands)
    June 30, 2018   Mar. 31, 2018   Dec. 31, 2017   Sept. 30, 2017   June 30, 2017
Commercial:                    
Energy   $ 3,147,219     $ 2,969,618     $ 2,930,156     $ 2,867,981     $ 2,847,240  
Services   2,944,499     2,928,294     2,986,949     2,967,513     2,958,827  
Healthcare   2,353,722     2,359,928     2,314,753     2,239,451     2,221,518  
Wholesale/retail   1,699,554     1,531,576     1,471,256     1,658,098     1,543,695  
Manufacturing   647,816     559,695     496,774     519,446     546,137  
Other commercial and industrial   556,229     570,556     534,087     543,445     520,538  
Total commercial   11,349,039     10,919,667     10,733,975     10,795,934     10,637,955  
                     
Commercial real estate:                    
Multifamily   1,056,984     1,008,903     980,017     999,009     952,380  
Office   820,127     737,144     831,770     797,089     862,973  
Retail   768,024     750,396     691,532     725,865     722,805  
Industrial   653,384     613,608     573,014     591,080     693,635  
Residential construction and land development   118,999     117,458     117,245     112,102     141,592  
Other commercial real estate   294,702     279,273     286,409     292,997     315,207  
Total commercial real estate   3,712,220     3,506,782     3,479,987     3,518,142     3,688,592  
                     
Residential mortgage:                    
Permanent mortgage   1,068,412     1,047,785     1,043,435     1,013,965     989,040  
Permanent mortgages guaranteed by U.S. government agencies   169,653     177,880     197,506     187,370     191,729  
Home equity   704,185     720,104     732,745     744,415     758,429  
Total residential mortgage   1,942,250     1,945,769     1,973,686     1,945,750     1,939,198  
                     
Personal   1,000,187     965,632     965,776     947,008     917,900  
                     
Total   $ 18,003,696     $ 17,337,850     $ 17,153,424     $ 17,206,834     $ 17,183,645  



LOANS BY PRINCIPAL MARKET AREA -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands)
  June 30, 2018   Mar. 31, 2018   Dec. 31, 2017   Sept. 30, 2017   June 30, 2017
                   
Bank of Oklahoma:                  
Commercial $ 3,465,407     $ 3,265,013     $ 3,238,720     $ 3,408,973     $ 3,369,967  
Commercial real estate 662,665     668,031     682,037     712,915     667,932  
Residential mortgage 1,403,658     1,419,281     1,435,432     1,405,900     1,398,021  
Personal 362,846     353,128     342,212     322,320     318,016  
Total Bank of Oklahoma 5,894,576     5,705,453     5,698,401     5,850,108     5,753,936  
                   
Bank of Texas:                  
Commercial 4,922,451     4,715,841     4,520,401     4,434,595     4,339,634  
Commercial real estate 1,336,101     1,254,421     1,261,864     1,236,702     1,360,164  
Residential mortgage 243,400     229,761     233,675     229,993     232,074  
Personal 394,021     363,608     375,084     375,173     354,222  
Total Bank of Texas 6,895,973     6,563,631     6,391,024     6,276,463     6,286,094  
                   
Bank of Albuquerque:                  
Commercial 305,167     315,701     343,296     367,747     369,370  
Commercial real estate 386,878     348,485     341,282     319,208     324,405  
Residential mortgage 90,581     93,490     98,018     101,983     103,849  
Personal 11,107     11,667     11,721     12,953     12,439  
Total Bank of Albuquerque 793,733     769,343     794,317     801,891     810,063  
                   
Bank of Arkansas:                  
Commercial 93,217     94,430     95,644     91,051     85,020  
Commercial real estate 90,807     88,700     87,393     80,917     73,943  
Residential mortgage 6,927     7,033     6,596     6,318     6,395  
Personal 12,331     9,916     9,992     10,388     11,993  
Total Bank of Arkansas 203,282     200,079     199,625     188,674     177,351  
                   
Colorado State Bank & Trust:                  
Commercial 1,165,721     1,180,655     1,130,714     1,124,200     1,065,780  
Commercial real estate 267,065     210,801     174,201     186,427     255,379  
Residential mortgage 64,839     64,530     63,350     63,734     63,346  
Personal 60,504     63,118     63,115     60,513     56,187  
Total Colorado State Bank & Trust 1,558,129     1,519,104     1,431,380     1,434,874     1,440,692  
                   
Bank of Arizona:                  
Commercial 681,852     624,106     687,792     634,809     617,759  
Commercial real estate 710,784     672,319     660,094     706,188     705,858  
Residential mortgage 47,010     39,227     41,771     40,730     37,034  
Personal 65,541     57,023     57,140     55,050     55,528  
Total Bank of Arizona 1,505,187     1,392,675     1,446,797     1,436,777     1,416,179  
                   
Mobank (Kansas City):                  
Commercial 715,224     723,921     717,408     734,559     790,425  
Commercial real estate 257,920     264,025     273,116     275,785     300,911  
Residential mortgage 85,835     92,447     94,844     97,092     98,479  
Personal 93,837     107,172     106,512     110,611     109,515  
Total Mobank (Kansas City) 1,152,816     1,187,565     1,191,880     1,218,047     1,299,330  
                   
TOTAL BOK FINANCIAL $ 18,003,696     $ 17,337,850     $ 17,153,424     $ 17,206,834     $ 17,183,645  

Loans attributed to a geographical region may not always represent the location of the borrower or the collateral.


DEPOSITS BY PRINCIPAL MARKET AREA -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands)
  June 30, 2018   Mar. 31, 2018   Dec. 31, 2017   Sept. 30, 2017   June 30, 2017
Bank of Oklahoma:                  
Demand $ 3,867,933     $ 4,201,842     $ 3,885,008     $ 4,061,612     $ 4,353,421  
Interest-bearing:                  
Transaction 5,968,460     6,051,302     5,901,293     5,909,259     5,998,787  
Savings 289,202     289,351     265,870     265,023     263,664  
Time 1,207,471     1,203,534     1,092,133     1,131,547     1,170,014  
Total interest-bearing 7,465,133     7,544,187     7,259,296     7,305,829     7,432,465  
Total Bank of Oklahoma 11,333,066     11,746,029     11,144,304     11,367,441     11,785,886  
                   
Bank of Texas:                  
Demand 3,317,656     3,015,869     3,239,098     3,094,184     3,121,890  
Interest-bearing:                  
Transaction 2,168,488     2,208,480     2,397,071     2,272,987     2,272,185  
Savings 97,809     98,852     93,620     93,400     91,491  
Time 445,500     475,967     502,879     521,072     502,128  
Total interest-bearing 2,711,797     2,783,299     2,993,570     2,887,459     2,865,804  
Total Bank of Texas 6,029,453     5,799,168     6,232,668     5,981,643     5,987,694  
                   
Bank of Albuquerque:                  
Demand 770,974     695,060     663,353     659,793     612,117  
Interest-bearing:                  
Transaction 586,593     555,414     552,393     551,884     558,523  
Savings 59,415     60,596     55,647     53,532     54,136  
Time 212,689     216,306     216,743     224,773     229,616  
Total interest-bearing 858,697     832,316     824,783     830,189     842,275  
Total Bank of Albuquerque 1,629,671     1,527,376     1,488,136     1,489,982     1,454,392  
                   
Bank of Arkansas:                  
Demand 39,896     35,291     30,384     31,442     40,511  
Interest-bearing:                  
Transaction 143,298     94,206     85,095     126,746     129,848  
Savings 1,885     1,960     1,881     1,876     2,135  
Time 10,771     11,878     14,045     14,434     14,876  
Total interest-bearing 155,954     108,044     101,021     143,056     146,859  
Total Bank of Arkansas 195,850     143,335     131,405     174,498     187,370  
                   
Colorado State Bank & Trust:                  
Demand 529,912     521,963     633,714     540,300     577,617  
Interest-bearing:                  
Transaction 701,362     687,785     657,629     628,807     626,343  
Savings 38,176     37,232     35,223     34,776     35,651  
Time 208,049     215,330     224,962     231,927     228,458  
Total interest-bearing 947,587     940,347     917,814     895,510     890,452  
Total Colorado State Bank & Trust 1,477,499     1,462,310     1,551,528     1,435,810     1,468,069  
                   
Bank of Arizona:                  
Demand 387,952     330,196     334,701     335,740     366,866  
Interest-bearing:                  
Transaction 194,353     248,337     274,846     174,010     154,457  
Savings 3,935     4,116     3,343     4,105     3,638  
Time 22,447     21,009     20,394     20,831     19,911  
Total interest-bearing 220,735     273,462     298,583     198,946     178,006  
Total Bank of Arizona 608,687     603,658     633,284     534,686     544,872  
                   
Mobank (Kansas City):                  
Demand 459,636     505,802     457,080     462,410     496,473  
Interest-bearing:                  
Transaction 401,545     381,447     382,066     361,391     346,996  
Savings 13,052     13,845     13,574     12,513     13,603  
Time 20,805     22,230     27,260     27,705     31,119  
Total interest-bearing 435,402     417,522     422,900     401,609     391,718  
Total Mobank (Kansas City) 895,038     923,324     879,980     864,019     888,191  
                   
TOTAL BOK FINANCIAL $ 22,169,264     $ 22,205,200     $ 22,061,305     $ 21,848,079     $ 22,316,474  



NET INTEREST MARGIN TREND -- UNAUDITED
BOK FINANCIAL CORPORATION
  Three Months Ended
   June 30, 2018   Mar. 31, 2018   Dec. 31, 2017   Sept. 30, 2017   June 30, 2017
                   
TAX-EQUIVALENT ASSETS YIELDS                  
Interest-bearing cash and cash equivalents 1.86 %   1.57 %   1.27 %   1.29 %   1.04 %
Trading securities 3.63 %   3.40 %   3.38 %   3.47 %   3.23 %
Investment securities:                  
  Taxable 5.23 %   5.21 %   5.31 %   5.31 %   5.34 %
  Tax-exempt 2.42 %   2.25 %   2.69 %   2.60 %   2.51 %
Total investment securities 3.95 %   3.78 %   3.98 %   3.86 %   3.76 %
Available for sale securities:                  
  Taxable 2.29 %   2.22 %   2.19 %   2.16 %   2.09 %
  Tax-exempt 3.26 %   3.26 %   5.41 %   5.27 %   6.09 %
Total available for sale securities 2.30 %   2.23 %   2.21 %   2.17 %   2.11 %
Fair value option securities 3.16 %   2.95 %   2.90 %   2.97 %   2.92 %
Restricted equity securities 6.21 %   5.86 %   5.87 %   5.87 %   5.95 %
Residential mortgage loans held for sale 4.28 %   3.71 %   3.72 %   3.36 %   3.92 %
Loans 4.80 %   4.45 %   4.29 %   4.31 %   4.03 %
Allowance for loan losses                  
Loans, net of allowance 4.86 %   4.51 %   4.35 %   4.38 %   4.09 %
Total tax-equivalent yield on earning assets 3.91 %   3.61 %   3.49 %   3.50 %   3.30 %
                   
COST OF INTEREST-BEARING LIABILITIES                
Interest-bearing deposits:                  
  Interest-bearing transaction 0.55 %   0.45 %   0.35 %   0.32 %   0.26 %
  Savings 0.08 %   0.07 %   0.07 %   0.08 %   0.08 %
  Time 1.29 %   1.25 %   1.17 %   1.16 %   1.11 %
Total interest-bearing deposits 0.66 %   0.57 %   0.48 %   0.45 %   0.40 %
Funds purchased and repurchase agreements 0.53 %   0.40 %   0.28 %   0.25 %   0.13 %
Other borrowings 1.96 %   1.60 %   1.36 %   1.29 %   1.09 %
Subordinated debt 5.67 %   5.61 %   5.55 %   5.68 %   5.55 %
Total cost of interest-bearing liabilities 1.11 %   0.93 %   0.79 %   0.75 %   0.63 %
Tax-equivalent net interest revenue spread 2.80 %   2.68 %   2.70 %   2.75 %   2.67 %
Effect of noninterest-bearing funding sources and other 0.37 %   0.31 %   0.27 %   0.26 %   0.22 %
Tax-equivalent net interest margin 3.17 %   2.99 %   2.97 %   3.01 %   2.89 %

Yield calculations are shown on a tax equivalent basis at the statutory federal and state rates for the periods presented. The yield calculations exclude security trades that have been recorded on trade date with no corresponding interest income and the unrealized gains and losses. The yield calculation also includes average loan balances for which the accrual of interest has been discontinued and are net of unearned income. Yield/rate calculations are generally based on the conventions that determine how interest income and expense is accrued.


CREDIT QUALITY INDICATORS -- UNAUDITED
BOK FINANCIAL CORPORATION
(in thousands, except ratios)
  Three Months Ended
  June 30, 2018   Mar. 31, 2018   Dec. 31, 2017   Sept. 30, 2017   June 30, 2017
Nonperforming assets:                  
Nonaccruing loans:                  
Commercial $ 120,978     $ 131,460     $ 137,303     $ 176,900     $ 197,157  
Commercial real estate 1,996     2,470     2,855     2,975     3,775  
Residential mortgage 42,343     45,794     47,447     45,506     44,235  
Personal 340     340     269     255     272  
Total nonaccruing loans 165,657     180,064     187,874     225,636     245,439  
Accruing renegotiated loans guaranteed by U.S. government agencies 75,374     74,418     73,994     69,440     80,624  
Real estate and other repossessed assets 27,891     23,652     28,437     32,535     39,436  
Total nonperforming assets $ 268,922     $ 278,134     $ 290,305     $ 327,611     $ 365,499  
Total nonperforming assets excluding those guaranteed by U.S. government agencies $ 185,981     $ 194,833     $ 207,132     $ 249,280     $ 275,823  
                   
Nonaccruing loans by loan class:                  
Commercial:                  
Energy $ 65,597     $ 89,942     $ 92,284     $ 110,683     $ 123,992  
Services 4,377     2,109     2,620     1,174     7,754  
Healthcare 16,125     15,342     14,765     24,446     24,505  
Wholesale/retail 14,095     2,564     2,574     1,893     10,620  
Manufacturing 2,991     3,002     5,962     9,059     9,656  
Other commercial and industrial 17,793     18,501     19,098     29,645     20,630  
Total commercial 120,978     131,460     137,303     176,900     197,157  
Commercial real estate:                  
Multifamily                 10  
Office 275     275     275     275     396  
Retail 1,068     264     276     289     301  
Industrial                  
Residential construction and land development 350     1,613     1,832     1,924     2,051  
Other commercial real estate 303     318     472     487     1,017  
Total commercial real estate 1,996     2,470     2,855     2,975     3,775  
Residential mortgage:                  
Permanent mortgage 23,105     24,578     25,193     24,623     23,415  
Permanent mortgage guaranteed by U.S. government agencies 7,567     8,883     9,179     8,891     9,052  
Home equity 11,671     12,333     13,075     11,992     11,768  
Total residential mortgage 42,343     45,794     47,447     45,506     44,235  
Personal 340     340     269     255     272  
Total nonaccruing loans $ 165,657     $ 180,064     $ 187,874     $ 225,636     $ 245,439  
                   
Performing loans 90 days past due1 $ 879     $ 90     $ 633     $ 253     $ 1,414  
                   
Gross charge-offs $ (15,105 )   $ (2,890 )   $ (14,749 )   $ (5,825 )   $ (2,872 )
Recoveries 4,578     1,576     3,061     2,437     1,214  
Net charge-offs $ (10,527 )   $ (1,314 )   $ (11,688 )   $ (3,388 )   $ (1,658 )
                   
Provision for credit losses $     $ (5,000 )   $ (7,000 )   $     $  
                   
Allowance for loan losses to period end loans 1.19 %   1.29 %   1.34 %   1.44 %   1.46 %
Combined allowance for credit losses to period end loans 1.21 %   1.32 %   1.37 %   1.47 %   1.49 %
Nonperforming assets to period end loans and repossessed assets 1.49 %   1.60 %   1.69 %   1.90 %   2.12 %
Net charge-offs (annualized) to average loans 0.24 %   0.03 %   0.27 %   0.08 %   0.04 %
Allowance for loan losses to nonaccruing loans1 136.09 %   130.84 %   129.09 %   114.28 %   105.78 %
Combined allowance for credit losses to nonaccruing loans1 137.63 %   133.25 %   131.18 %   116.78 %   108.51 %

1   Excludes residential mortgage loans guaranteed by agencies of the U.S. government.


For Further Information Contact:

Joseph Crivelli                                    
Investor Relations                              
(918) 595-3030  

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