BOK Financial Corporation reported quarterly net income of $85.1 million or $1.24 per diluted share for the third quarter of 2011, up from $69.0 million or $1.00 per diluted share for the second quarter of 2011 and $64.3 million or $0.94 per diluted share for the third quarter of 2010. Net income for the nine months ended September 30, 2011 totaled $218.9 million or $3.19 per diluted share compared to $187.9 million or $2.75 per diluted share for the nine months ended September 30, 2010.
“BOK Financial is pleased to announce another outstanding quarter underscored by commercial loan growth and strong fees and commissions revenue,” said President and CEO Stan Lybarger. “The Company’s performance and capital position allows us to increase our quarterly cash dividend for the second time this year. Net interest revenue increased modestly over the previous quarter despite falling market interest rates and we continue to benefit from diversified sources of non-interest income. Mortgage banking revenue grew in response to continued low interest rates and brokerage and trading revenue benefited from increased market volatility. Commercial loan growth gained momentum in most of our markets.”
Highlights of third quarter of 2011 included:
- Fees and commissions revenue grew to $146.0 million for the third quarter of 2011, compared to $127.8 million for the second quarter of 2011. Mortgage banking revenue increased $10.1 million and brokerage and trading revenue increased $5.7 million.
- Operating expenses, excluding changes in the fair value of mortgage servicing rights, totaled $196.1 million, up $6.4 million over the prior quarter. The Company accrued $5.0 million for exposure to on-going litigation and made a $4.0 million discretionary contribution to the BOKF Charitable Foundation during the third quarter.
- No provision for credit losses was recorded in the third quarter of 2011, compared to a provision for credit losses of $2.7 million for the second quarter of 2011. Net loans charged off totaled $10.2 million or 0.37% of average loans on an annualized basis for the third quarter of 2011 compared to $8.5 million or 0.32% on an annualized basis for the previous quarter.
- The combined allowance for credit losses totaled $287 million or 2.58% of outstanding loans at September 30, 2011 compared to $297 million or 2.77% of outstanding loans at June 30, 2011. Nonperforming assets totaled $388 million or 3.45% of outstanding loans and repossessed assets at September 30, 2011 and $351 million or 3.23% of outstanding loans and repossessed assets at June 30, 2011.
- Outstanding loan balances were $11.1 billion at September 30, 2011 compared to $10.7 billion at June 30, 2011. Commercial loan balances continued to grow in the third quarter of 2011, increasing $297 million over June 30, 2011. Commercial real estate loans increased $76 million and residential mortgage loans increased $44 million. Consumer loans decreased $30 million.
- Period end deposits totaled $18.4 billion at September 30, 2011 compared to $17.6 billion at June 30, 2011. Demand deposit accounts increased $688 million and interest-bearing transaction accounts increased $240 million. Time deposits decreased $80 million.
- Tangible common equity ratio was 9.65% at September 30, 2011 and 9.71% at June 30, 2011. The tangible common equity ratio is a non-GAAP measure of capital strength used by the Company and investors based on shareholders’ equity minus intangible assets and equity that does not benefit common shareholders. The Company and its subsidiary bank continue to exceed the regulatory definition of well capitalized. The Company’s Tier 1 capital ratios, as defined by banking regulations, were 13.14% at September 30, 2011 and 13.30% at June 30, 2011.
- The Company paid a cash dividend of $19 million or $0.275 per common share during the third quarter of 2011. On October 25, 2011, the board of directors approved an increase in the quarterly cash dividend to $0.33 per common share payable on or about November 30, 2011 to shareholders of record as of November 16, 2011.
Net Interest RevenueNet interest revenue increased $1.4 million over the second quarter of 2011. Average earning assets increased $393 million. Net interest margin decreased 6 basis points from the prior quarter to 3.34%.