STILLWATER, Okla., Oct. 20, 2010 (GLOBE NEWSWIRE) -- Southwest Bancorp, Inc. (Nasdaq:OKSB), ("Southwest"), today reported net income available to common shareholders of $2.8 million, or $0.15 per diluted share for the third quarter of 2010, compared to $1.1 million, or $0.07 per diluted share for the third quarter of 2009, and $3.4 million, or $0.19 per diluted share for the second quarter of 2010. Net income available to common shareholders for the nine months ended September 30, 2010 was $9.5 million, or $0.55 per diluted share, compared to $6.3 million, or $0.43 per diluted share, for the nine months ended September 30, 2009.

Rick Green, Southwest Bancorp's President and Chief Executive Officer, stated, "We are pleased with our solid performance this quarter. Earnings for the third quarter were based on stable net interest income and controlled noninterest expenses. We increased our allowance for loan losses by $5.4 million in the third quarter after recording $6.6 million in net charge offs. Our annualized quarterly ratio of net loan charge-offs to portfolio loans remained at approximately 1.00%.

The Board of Directors and management are dedicated to the resolution of problem credits, the maintenance of capital and liquidity, stability in net interest income, and control of operating expenses. We continue to manage our loan portfolio through this difficult credit climate with our ongoing, disciplined workout process focused on addressing the challenges of the commercial real estate construction and commercial mortgage sectors. We are encouraged that the state economic factors for our principal markets in Oklahoma, Texas, and Kansas continue to outperform most of the nation. We continue to make loans in each of our markets with an emphasis on health care lending and carefully controlled real estate collateralized credits.

We maintain a solid capital base. Our second quarter common stock offering gave us $54.3 million in new common equity. Southwest and its banking subsidiaries have maintained capital levels that substantially exceed the minimums for regulatory "well-capitalized" status. At September 30, 2010 Southwest's total regulatory capital was $475.0 million for a total risk-based capital ratio of 18.45%, and Tier 1 capital was $442.2 million for a Tier 1 risk-based capital ratio of 17.17%." 

Please review the following discussion and the attached financial tables for important additional information regarding our financial condition and performance.

Financial Overview

Condition: Total assets were $2.9 billion at September 30, 2010, a decrease of 7% from December 31, 2009. At September 30, 2010 total loans were $2.5 billion, a decrease of 6% from December 31, 2009.

At September 30, 2010 the allowance for loan losses was $72.4 million, up 25% from September 30, 2009 and 16% from year-end 2009, and represented 3.00% of noncovered portfolio loans versus 2.25% and 2.46% at September 30, 2009 and December 31, 2009, respectively. The methodology used to determine the appropriate amount of the allowance for loan losses at a particular time includes consideration of risk factors related to Southwest and to our markets including regular assessments of national and local economic conditions and trends. Provisions for loan losses are recorded in the amount necessary to maintain the allowance at the level management deems appropriate. 

Excluding assets subject to loss sharing agreements with the FDIC ("covered assets"), nonperforming assets increased to $171.4 million and 7.00% of portfolio loans and other real estate as of September 30, 2010 from $139.8 million and 5.59% of portfolio loans and other real estate as of June 30, 2010 and from $124.6 million and 4.87% of portfolio loans and other real estate as of December 31, 2009. A breakdown of noncovered portfolio loans and noncovered nonperforming assets by type is shown in the following table:
(dollars in thousands) Noncovered portfolio loans Noncovered nonperforming assets
Real estate construction  $ 558,300  $ 88,590
Commercial real estate  1,251,563  34,448
Commercial  462,286  6,180
Residential real estate mortgages  101,633  6,401
Other consumer loans  39,014  42
Other real estate  --   35,723
Total   $ 2,412,796  $ 171,384

Excluding covered loans, nonaccrual loans were $135.2 million as of September 30, 2010, an increase of $23.3 million, or 21%, from June 30, 2010, and $29.3 million, or 28%, from December 31, 2009. These loans are carried at their estimated collectible amounts and no longer accrue interest. Noncovered loans 90 days or more past due were $0.5 million as of September 30, 2010. These loans are deemed to have sufficient collateral and are in the process of collection. 

Excluding covered loans, performing loans considered potential problem loans, which are not included in the past due or nonaccrual categories but for which known information about possible credit problems cause management to be uncertain as to the continued ability of the borrowers to comply with the present loan repayment terms in future periods, amounted to $236.8 million at September 30, 2010, a decrease of $5.4 million from June 30, 2010 and $21.6 million from December 31, 2009. Potential problem loans are subject to continuing management attention and are considered by management in determining the level of the allowance for loan losses. 

Year-to-date Results:

Summary: The $3.2 million increase in our net income available to common shareholders from 2009 is the result of a $9.5 million increase in net interest income driven by an improved net interest margin and a $0.2 million decrease in the provision for loan losses, offset in part by a $3.0 million decrease in noninterest income, a $2.0 million increase in noninterest expense, and a $1.5 million increase in income tax expense. 

Net Interest Income:  Net interest income totaled $80.4 million for the first nine months of 2010, compared to $70.9 million for the first nine months of 2009, an increase of $9.5 million, or 13%. Year-to-date net interest margin was 3.63%, compared to 3.27% for the same period in 2009. Included in 2010 year-to-date net interest income is $0.5 million of net recoveries from the resolution of nonperforming loans and additional discount accretion on loans and the loss share receivable, offset in part by interest reversals on nonaccrual loans. Included in 2009 year-to-date net interest income is a recovery of $1.9 million in interest from the successful resolution of a nonperforming loan. These net recoveries increased year-to-date interest margin by 3 basis points and 9 basis points for 2010 and 2009, respectively.   

Provision for Loan Losses and Net Charge Offs: The provision for loan losses totaled $28.3 million for the first nine months of 2010, compared to $28.5 million for the first nine months of 2009. Noncovered net charge offs totaled $18.3 million, or 0.98% (annualized) of average noncovered portfolio loans year-to-date as of September 30, 2010, compared to $10.5 million, or 0.54% (annualized) of average noncovered portfolio loans for the same period in the prior year.

Noninterest Income: Noninterest income totaled $14.5 million for the first nine months of 2010, compared to $17.4 million for the first nine months of 2009. The decrease in noninterest income was primarily the result of a $3.3 million gain on the FDIC-assisted acquisition that was recorded in the prior year.

Noninterest Expense: Noninterest expense totaled $46.8 million for the first nine months of 2010, compared to $44.8 million for the first nine months of 2009. The increase consists of a $1.6 million increase in other general and administrative expense, a $0.9 million increase in other real estate expense, and a $0.5 million increase in personnel expense, offset in part by a $0.9 million decrease in provision for unfunded loan commitments.

Third Quarter Results:

Summary: Net income available to common shareholders was $2.8 million in the third quarter of 2010, compared to $1.1 million in the third quarter of 2009 and $3.4 million in the second quarter of 2010. The increase from the third quarter of 2009 is the result of a $2.6 million increase in noninterest income and a $1.1 million increase in net interest income, offset in part by a $1.8 million increase in the provision for loan losses and a $0.2 million increase in income taxes. The decrease from the second quarter of 2010 is the result of a $4.2 million increase in the provision for loan losses and a $0.7 million decrease in net interest income, offset in part by a $2.4 million increase in noninterest income, a $1.2 million decrease in income taxes, and a $0.7 million decrease in noninterest expense.

Net Interest Income:  Net interest income totaled $26.5 million for the third quarter of 2010, compared to $25.4 million for the third quarter of 2009, an increase of $1.1 million, or 4%, and $27.1 million for the second quarter of 2010, a decrease of $0.7 million, or 2%.  Net interest margin was 3.63% for the third quarter of 2010, compared to 3.39% for the third quarter of 2009 and 3.65% for the second quarter of 2010.  Included in the third quarter of 2010 net interest margin is a net reduction of $0.3 million from the interest reversals on nonaccrual loans offset by the quarterly adjustment of the discount accretion on loans and the loss share receivable. Included in the second quarter 2010 net interest margin is a recovery of $0.5 million from the quarterly adjustment of the discount accretion on loans and the loss share receivable. The net effect of these adjustments on net interest margin were a 5 basis point decrease and a 6 basis point increase for the third quarter and second quarter, respectively.     

Provision for Loan Losses and Net Charge Offs: The provision for loan losses totaled $12.0 million for the third quarter of 2010, compared to $10.2 million for the third quarter of 2009 and $7.8 million for the second quarter of 2010.  Noncovered net charge offs totaled $6.6 million, or 1.07% (annualized) of average noncovered portfolio loans for the third quarter of 2010, compared to $4.2 million, or 0.61% (annualized) of average noncovered portfolio loans for the third quarter of 2009.

Noninterest Income: Noninterest income totaled $6.3 million for the third quarter of 2010, compared to $3.7 million for the third quarter of 2009 and $4.0 million for the second quarter of 2010.  The increase in noninterest income from the third quarter of 2009 and from the second quarter of 2010 was primarily the result of a $2.5 million increase in gain on sale of securities. 

Noninterest Expense: Noninterest expense totaled $15.4 million for the third quarter of 2010, compared to $15.5 million for the third quarter of 2009 and $16.1 million for the second quarter of 2010.  The decrease from third quarter 2009 consists of a $0.6 million decrease in personnel expense and a $0.2 million decrease in provision for unfunded loan commitments, offset in part by a $0.5 million increase in other general and administrative expense and a $0.2 million increase in FDIC and other insurance expense. The decrease from second quarter 2010 consists of a $0.5 million decrease in personnel expense, a $0.2 million decrease in FDIC and other insurance expense, and a $0.4 million decrease in other real estate expense, offset in part by a $0.3 million increase in other general and administrative expense.

Southwest Bancorp and Subsidiaries

Southwest is the bank holding company for Stillwater National Bank and Trust Company ("Stillwater National") and Bank of Kansas. Through its subsidiaries, Southwest offers commercial and consumer lending, deposit and investment services, and specialized cash management, and other financial services from offices in Oklahoma, Texas, and Kansas, and on the Internet, through SNB DirectBanker®. We were organized in 1981 as the holding company for Stillwater National, which was chartered in 1894. At September 30, 2010 we had total assets of $2.9 billion, deposits of $2.3 billion, and shareholders' equity of $376.9 million.

Our area of expertise focuses on the special financial needs of healthcare and health professionals, businesses and their managers and owners, and commercial and commercial real estate borrowers. We established a strategic focus on healthcare lending in 1974. We provide credit and other services, such as deposits, cash management, and document imaging for physicians and other healthcare practitioners to start or develop their practices and finance the development and purchase of medical offices, clinics, surgical care centers, hospitals, and similar facilities. As of September 30, 2010, approximately $706.1 million, or 29%, of our noncovered loans were loans to individuals and businesses in the healthcare industry. 

We also focus on commercial real estate mortgage and construction credits. We do not focus on one-to-four family residential development loans or "spec" residential property credits. Additionally, subprime lending has never been a part of our business strategy, and our exposure to subprime loans and subprime lenders is minimal. One-to-four family mortgages account for less than 5% of total noncovered loans. As of September 30, 2010 approximately $1.8 billion, or 74%, of our noncovered loans was commercial real estate mortgage and construction loans, including $404.7 million of loans to individuals and businesses in the healthcare industry. Our commercial real estate mortgage and construction and commercial loans are concentrated in states that have experienced less adverse effects from the recession than many others.

We operate six offices in Texas, eleven offices in Oklahoma, and eight offices in Kansas. At September 30, 2010 our Texas segment accounted for $1.0 billion, or 41% of total portfolio loans, followed by $890.6 million, or 36%, from our Oklahoma segment, $309.2 million, or 13%, from our Kansas segment, and $248.9 million, or 10%, from our other states segment. 

Southwest's common stock is traded on the NASDAQ Global Select Market under the symbol OKSB. Southwest's public trust preferred securities are traded on the NASDAQ Global Select Market under the symbol OKSBP.

The Southwest Bancorp, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=8074

Forward-Looking Statements

This Press Release includes forward-looking statements that are subject to risks and uncertainties. These forward-looking statements include: statements of Southwest's goals, intentions, and expectations; estimates of risks and of future costs and benefits; expectations regarding future financial performance of Southwest and its operating segments; assessments of loan quality, probable loan losses, and the amount and timing of loan payoffs; liquidity, contractual obligations, off-balance sheet risk, and interest rate risk; estimates of value of acquired assets, deposits, and other liabilities; and statements of Southwest's ability to achieve financial and other goals. These forward-looking statements are subject to significant uncertainties, because they are based upon: the amount and timing of future changes in interest rates, market behavior, and other economic conditions; future laws and regulations and accounting principles; and a variety of other matters. Because of these uncertainties, the actual future results may be materially different from the results indicated by these forward-looking statements. In addition, Southwest's past growth and performance do not necessarily indicate our future results.

Southwest is required under generally accepted accounting principles to evaluate subsequent events and their impact, if any, on its financial statements as of September 30, 2010 through the date its financial statements are filed with the Securities and Exchange Commission. The September 30, 2010 financial statements will be adjusted if necessary to properly reflect the impact of subsequent events on estimates used to prepare those statements.

Financial Tables
Unaudited Financial Highlights Table 1
Unaudited Consolidated Statements of Financial Condition Table 2
Unaudited Consolidated Statements of Operations Table 3
Unaudited Average Balances, Yields, and Rates-Quarterly Table 4
Unaudited Average Balances, Yields, and Rates-Year-to-date Table 5
Unaudited Quarterly Summary Financial Data  Table 6
Unaudited Quarterly Supplemental Analytical Data  Table 7
   
   
 SOUTHWEST BANCORP, INC.   Table 1 
 UNAUDITED FINANCIAL HIGHLIGHTS   
 (Dollars in thousands except per share)   
   Third Quarter   Second Quarter 
QUARTERLY HIGHLIGHTS       %     % 
  2010 2009  Change  2010  Change 
Operations           
Net interest income  $ 26,452 $ 25,400 4% $ 27,108 (2)%
Provision for loan losses  11,988 10,177 18 7,776 54
Noninterest income  6,335 3,710 71 3,962 60
Noninterest expense  15,418 15,528 (1) 16,146 (5)
Income before taxes  5,381 3,405 58 7,148 (25)
Taxes on income  1,508 1,271 19 2,737 (45)
Net income  3,873 2,134 81 4,411 (12)
Net income available to common shareholders  2,825 1,097 158 3,366 (16)
Diluted earnings per share  0.15 0.07 114 0.19 (21)
Balance Sheet           
Total assets  2,905,275 3,029,347 (4) 3,010,835 (4)
Loans held for sale  34,868 36,526 (5) 25,615 36
Noncovered portfolio loans  2,412,796 2,675,741 (10 2,475,348 (3)
Covered portfolio loans  60,558 103,630 (42) 68,006 (11)
Total deposits  2,345,648 2,473,162 (5) 2,444,939 (4)
Total shareholders' equity  376,576 309,118 22 375,319  --
Book value per common share  15.93 16.43 (3) 15.88  --
Key Ratios           
Net interest margin  3.63% 3.39%   3.65%  
Efficiency ratio  47.02 53.34   51.97  
Total capital to risk-weighted assets  18.45 14.31   17.78  
Nonperforming loans to portfolio loans - noncovered  5.62 4.53   3.89  
Shareholders' equity to total assets  12.96 10.20   12.47  
Tangible common equity to tangible assets*  10.43 7.79   10.02  
Return on average assets (annualized)  0.52 0.28   0.58  
Return on average common equity (annualized)  3.57 1.78   4.64  
Return on average tangible common equity (annualized)**  3.65 1.83   4.75  
 
YEAR-TO-DATE HIGHLIGHTS   Nine Months     
       %     
  2010 2009  Change     
Operations           
Net interest income  $ 80,361 $ 70,894 13%    
Provision for loan losses  28,295 28,536 (1)    
Noninterest income  14,475 17,448 (17)    
Noninterest expense  46,822 44,817 4    
Income before taxes  19,719 14,989 32    
Taxes on income  7,063 5,581 27    
Net income  12,656 9,408 35    
Net income available to common shareholders  9,520 6,303 51    
Diluted earnings per share  0.55 0.43 28    
Balance Sheet           
Total assets  2,905,275 3,029,347 (4)    
Loans held for sale  34,868 36,526 (5)    
Noncovered portfolio loans  2,412,796 2,675,741 (10)    
Covered portfolio loans  60,558 103,630 (42)    
Total deposits  2,345,648 2,473,162 (5)    
Total shareholders' equity  376,576 309,118 22    
Book value per common share  15.93 16.43 (3)    
Key Ratios           
Net interest margin  3.63% 3.27%      
Efficiency ratio (GAAP-based)  49.37 50.73      
Total capital to risk-weighted assets  18.45 14.31      
Nonperforming loans to portfolio loans - noncovered  5.62 4.53      
Shareholders' equity to total assets  12.96 10.20      
Tangible common equity to tangible assets*  10.43 7.79      
Return on average assets  0.56 0.42      
Return on average common equity  4.47 3.50      
Return on average tangible common equity**  4.58 3.61      
 
Balance sheet amounts and ratios are as of period end unless otherwise noted. 
* This is a Non-GAAP financial measure. Please see Table 7 for a reconciliation to the most directly comparable GAAP based measure. 
* This is a Non-GAAP financial measure. 
           
Please see accompanying tables for additional financial information. 
   
SOUTHWEST BANCORP, INC.   Table 2 
UNAUDITED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION   
(Dollars in thousands, except per share)   
       
  September 30, 2010 December 31, 2009 September 30, 2009
Assets       
Cash and cash equivalents   $ 89,458  $ 118,847  $ 32,094
Investment securities:       
Held to maturity. Fair value: $9,185, $6,754, $6,907, respectively  9,093 6,670 6,795
Available for sale. Amortized cost: $226,323, $236,199, $228,723, respectively  231,751 237,703 233,009
Other investments, at cost  10,389 19,066 18,986
Loans held for sale  34,868 43,134 36,526
Noncovered loans receivable  2,412,796 2,539,294 2,572,111
Less: Allowance for loan losses  (72,418) (62,413) (57,777)
Net noncovered loans receivable  2,340,378 2,476,881 2,514,334
Covered loans receivable (includes loss share: $17.9 million, $23.9 million, $33.3 million, respectively)  60,558 85,405  103,630
Net loans receivable  2,400,936 2,562,286 2,617,964
Accrued interest receivable  9,663 10,806 10,794
Premises and equipment, net  25,075 26,536 25,255
Noncovered other real estate  35,723 18,432 6,389
Covered other real estate  4,448 4,748  2,598
Goodwill  6,811 6,811 6,811
Other intangible assets, net  5,358 5,779 5,872
Other assets  41,702 47,473 26,254
Total assets   $ 2,905,275  $ 3,108,291  $ 3,029,347
       
Liabilities       
Deposits:       
Noninterest-bearing demand   $ 329,655  $ 324,829  $ 309,767
Interest-bearing demand  86,153 74,201 82,622
Money market accounts  518,422 505,521 506,196
Savings accounts  25,556 25,730 25,636
Time deposits of $100,000 or more  795,303 1,004,439 888,814
Other time deposits  590,559 658,010 660,127
Total deposits  2,345,648 2,592,730 2,473,162
Accrued interest payable  2,457 3,191 4,545
Income tax payable   6,603  4,486  3,822
Other liabilities  9,522 13,121 10,288
Other borrowings  82,506 103,022 146,449
Subordinated debentures  81,963 81,963 81,963
Total liabilities  2,528,699 2,798,513 2,720,229
       
Shareholders' equity       
Serial preferred stock; 2,000,000 shares authorized;  70,000 shares issued and outstanding  67,548 67,037  66,872
Common stock -- $1 par value; 40,000,000 shares authorized; 19,395,675, 14,750,713, 14,748,223 shares issued, respectively  19,396 14,751 14,748
Paid in capital  98,750 49,029 49,007
Retained earnings  187,535 178,016 175,834
Accumulated other comprehensive income  3,347 945 2,657
Total shareholders' equity  376,576 309,778 309,118
Total liabilities and shareholders' equity   $ 2,905,275  $ 3,108,291  $ 3,029,347
   
   
SOUTHWEST BANCORP, INC.   Table 3 
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS   
(Dollars in thousands except per share)   
         
  For the three months ended September 30,  For the nine months ended September 30, 
  2010 2009 2010 2009
Interest income         
Loans  $ 32,824 $ 35,607 $ 101,087 $ 104,884
Investment securities  2,204 2,122 6,844 6,713
Other interest-earning assets  55 4 190 13
Total interest income  35,083 37,733 108,121 111,610
         
Interest expense         
Interest-bearing deposits  6,802 10,097 22,347 33,229
Other borrowings  524 960 1,565 3,424
Subordinated debentures  1,305 1,276 3,848 4,063
Total interest expense  8,631 12,333 27,760 40,716
         
Net interest income  26,452 25,400 80,361 70,894
         
Provision for loan losses  11,988 10,177 28,295 28,536
         
Net interest income after provision for loan losses  14,464 15,223 52,066 42,358
         
Noninterest income         
Service charges and fees  2,994 2,992 9,260 8,409
Gain on acquisition   --   --   --   3,281
Gain on sales of loans  653 386 2,054 2,030
Gain on investment securities  2,480 10 2,521  2,922
Other noninterest income  208 322 640 806
Total noninterest income 6,335 3,710 14,475 17,448
         
Noninterest expense         
Salaries and employee benefits  7,183 7,824 22,400 21,950
Occupancy  2,835 2,958 8,454 8,478
FDIC and other insurance  1,347 1,134 4,455 4,444
Other real estate, net  228 90 963 91
General and administrative  3,825 3,522 10,550 9,854
Total noninterest expense  15,418 15,528 46,822 44,817
Income before taxes  5,381 3,405 19,719 14,989
Taxes on income  1,508 1,271 7,063 5,581
Net income  $ 3,873 $ 2,134 $ 12,656 $ 9,408
Net income available to common shareholders  $ 2,825 $ 1,097 $ 9,520 $ 6,303
         
Basic earnings per common share  $ 0.15 $ 0.07 $ 0.55 $ 0.43
Diluted earnings per common share  0.15 0.07 0.55 0.43
Common dividends declared per share   --  0.0238  --  0.0714
   
   
SOUTHWEST BANCORP, INC.  Table 4
UNAUDITED AVERAGE BALANCES, YIELDS, AND RATES   
(Dollars in thousands)  
             
   For the three months ended September 30,
  2010 2009
  Average Balance Interest Average Yield/Rate Average Balance Interest Average Yield/Rate
Assets            
Loans (2) $ 2,543,412 $ 32,824 5.12% $ 2,719,835 $ 35,607 5.19%
Investment securities 261,124 2,204 3.35 243,604 2,122 3.46
Other interest-earning assets 85,214 55 0.26 10,442 4 0.15
Total interest-earning assets 2,889,750 35,083 4.82 2,973,881 37,733 5.03
Other assets 76,570     62,160    
Total assets $ 2,966,320     $ 3,036,041    
             
Liabilities and Shareholders' Equity            
Interest-bearing demand deposits $ 93,481 $ 111 0.47% $ 84,031 $ 107 0.51%
Money market accounts 515,754 976 0.75 498,842 1,220 0.97
Savings accounts 25,306 15 0.24 26,101 39 0.59
Time deposits 1,428,247 5,700 1.58 1,547,192 8,731 2.24
Total interest-bearing deposits 2,062,788 6,802 1.35 2,156,166 10,097 1.86
Other borrowings 93,136 524 2.23 165,327 960 2.30
Subordinated debentures 81,963 1,305 6.37 81,963 1,276 6.23
Total interest-bearing liabilities 2,237,887 8,631 1.53 2,403,456 12,333 2.04
             
Noninterest-bearing demand deposits 330,321     299,235    
Other liabilities 16,960     22,365    
Shareholders' equity 381,152     310,985    
Total liabilities and shareholders' equity $ 2,966,320     $ 3,036,041    
             
Net interest income and spread   $ 26,452 3.29%   $ 25,400 2.99%
Net interest margin (1)     3.63%     3.39%
Average interest-earning assets to average interest-bearing liabilities 129.13%     123.73%    
             
             
(1) Net interest margin = annualized net interest income / average interest-earning assets 
(2) Information regarding noncovered and covered loans for the period shown is not readily available. 
   
   
SOUTHWEST BANCORP, INC.  Table 5
UNAUDITED AVERAGE BALANCES, YIELDS, AND RATES   
(Dollars in thousands)  
             
  For the nine months ended September 30, 
  2010 2009
  Average Balance Interest Average Yield/Rate Average Balance Interest Average Yield/Rate
Assets            
Loans (2)  $ 2,606,166 $ 101,087 5.19%  $ 2,655,156 $ 104,884 5.28%
Investment securities 260,137 6,844 3.52 239,134 6,713 3.75
Other interest-earning assets 97,121 190 0.26 5,877 13 0.30
Total interest-earning assets 2,963,424 108,121 4.88 2,900,167 111,610 5.15
Other assets 74,199     66,254    
Total assets  $ 3,037,623      $ 2,966,421    
             
Liabilities and Shareholders' Equity            
Interest-bearing demand deposits  $ 102,843 $ 383 0.50%  $ 86,576 $ 410 0.63%
Money market accounts 508,742 3,026 0.80 479,700 3,784 1.05
Savings accounts 25,515 47 0.25 19,535 62 0.42
Time deposits 1,534,135 18,891 1.65 1,496,193 28,973 2.59
Total interest-bearing deposits 2,171,235 22,347 1.42 2,082,004 33,229 2.13
Other borrowings 96,099 1,565 2.18 199,982 3,424 2.29
Subordinated debentures 81,963 3,848 6.26 81,963 4,063 6.61
Total interest-bearing liabilities 2,349,297 27,760 1.58 2,363,949 40,716 2.30
             
Noninterest-bearing demand deposits 318,609     274,535    
Other liabilities 17,629     20,877    
Shareholders' equity 352,088     307,060    
Total liabilities and shareholders' equity  $ 3,037,623      $ 2,966,421    
             
Net interest income and spread   $ 80,361 3.30%   $ 70,894 2.85%
Net interest margin (1)     3.63%     3.27%
Average interest-earning assets to average interest-bearing liabilities 126.14%     122.68%    
             
             
(1) Net interest margin = annualized net interest income / average interest-earning assets 
(2) Information regarding noncovered and covered loans for the period shown is not readily available. 
   
   
SOUTHWEST BANCORP, INC.   Table 6 
UNAUDITED QUARTERLY SUMMARY FINANCIAL DATA   
(Dollars in thousands except per share)   
   
   2010 2009
   Sep. 30   Jun. 30   Mar. 31   Dec. 31   Sep. 30   Jun. 30   Mar. 31 
OPERATIONS               
Interest income:               
Loans   $ 32,824  $ 33,891  $ 34,372  $ 36,355  $ 35,607  $ 36,009  $ 33,268
Investment securities  2,204 2,320 2,320 2,433 2,122 2,079 2,512
Other interest-earning assets  55 68 67 1 4 3 6
Total interest income  35,083 36,279 36,759 38,789 37,733 38,091 35,786
Interest expense:               
Interest bearing demand deposits  111 140 132 66 107 150 153
Money market accounts  976 1,037 1,013 1,170 1,220 1,211 1,353
Savings accounts  15 16 16 16 39 14 9
Time deposits of $100,000 or more  3,128 3,517 4,024 4,340 4,822 5,552 5,980
Other time deposits  2,572 2,661 2,989 3,498 3,909 4,145 4,565
Total interest-bearing deposits  6,802 7,371 8,174 9,090 10,097 11,072 12,060
Other borrowings  524 524 517 625 960 1,180 1,284
Subordinated debentures  1,305 1,276 1,267 1,277 1,276 1,383 1,404
Total interest expense  8,631 9,171 9,958 10,992 12,333 13,635 14,748
Net interest income  26,452 27,108 26,801 27,797 25,400 24,456 21,038
Provision for loan losses  11,988 7,776 8,531 10,640 10,177 7,477 10,882
Noninterest income:               
Service charges and fees  2,994 3,170 3,096 3,295 2,992 2,817 2,600
Gain on sales of loans  653 416 985 933 386 926 718
Gain (loss) on investment securities  2,480 34 7 3 10 (9) 2,921
Other noninterest income  208 342 90 257 322 3,527 238
Total noninterest income  6,335 3,962 4,178 4,488 3,710 7,261 6,477
Noninterest expense:               
Salaries and employee benefits  7,183 7,637 7,580 7,349 7,824 6,887 7,239
Occupancy  2,835 2,836 2,783 3,159 2,958 2,789 2,731
FDIC and other insurance  1,347 1,521 1,587 1,101 1,134 2,319 991
Other real estate, net  228 629 106 39 90 103 (102)
Provision for unfunded loan commitments  (294) (512) (465) 147 (79) (388) 90
Other general and administrative  4,119 4,035 3,667 4,246 3,601 2,980 3,650
Total noninterest expenses  15,418 16,146 15,258 16,041 15,528 14,690 14,599
Income before taxes  5,381 7,148 7,190 5,604 3,405 9,550 2,034
Taxes on income  1,508 2,737 2,818 2,030 1,271 3,605 705
Net income   $ 3,873  $ 4,411  $ 4,372  $ 3,574  $ 2,134  $ 5,945  $ 1,329
Net income available to common shareholders   $ 2,825  $ 3,366  $ 3,329  $ 2,534  $ 1,097  $ 4,910  $ 296
PER SHARE DATA               
Basic earnings per common share   $ 0.15  $ 0.19  $ 0.23  $ 0.17  $ 0.07  $ 0.34  $ 0.02
Diluted earnings per common share   0.15 0.19 0.23  0.17  0.07 0.33 0.02
Common dividends declared per share   --   --   --   0.0238  0.0238 0.0238 0.0238
Book value per common share   15.93 15.88 16.79  16.46  16.43 16.30 16.01
Tangible book value per share*   15.58 15.53 16.33  15.99  15.96 15.84 15.52
COMMON STOCK               
Shares issued  19,395,675 19,388,797 14,779,711 14,750,713 14,748,223 14,658,042 14,658,042
Less treasury shares   --   --   --   --   --  (15,602) (49,930)
Outstanding shares  19,395,675 19,388,797 14,779,711 14,750,713 14,748,223 14,642,440 14,608,112
OTHER FINANCIAL DATA               
Investment securities   $ 251,233  $ 265,895  $ 260,837  $ 263,439  $ 258,790  $ 243,077  $ 179,006
Loans held for sale  34,868 25,615 25,586 43,134 36,526 26,006 76,404
Noncovered portfolio loans  2,412,796 2,475,348 2,516,397 2,539,294 2,572,111 2,587,230 2,526,293
Total noncovered loans  2,447,664 2,500,963 2,541,983 2,582,428 2,608,637 2,613,236 2,602,697
Covered portfolio loans  60,558  68,006  76,909 85,405 103,630  117,096  -- 
Total assets  2,905,275 3,010,835 3,074,923 3,108,291 3,029,347 3,038,985 2,928,133
Total deposits  2,345,648 2,444,939 2,554,165 2,592,730 2,473,162 2,452,295 2,330,089
Other borrowings  82,506 93,036 103,620 103,022 146,449 176,368 193,739
Subordinated debentures  81,963 81,963 81,963 81,963 81,963 81,963 81,963
Total shareholders' equity  376,576 375,319 315,341 309,778 309,118 305,416 300,406
Mortgage servicing portfolio  261,266 249,632 241,224 237,459 223,226 209,425 179,959
INTANGIBLE ASSET DATA               
Goodwill   $ 6,811  $ 6,811  $ 6,811  $ 6,811  $ 6,811  $ 6,811  $ 7,071
Core deposit intangible  3,693  3,830  3,967  4,103 4,240  4,378  2,498
Mortgage servicing rights   1,661  1,589  1,603  1,670  1,625  1,589  1,362
Nonmortgage servicing rights   4  5 5  6  7  7 8
Total intangible assets   $ 12,169  $ 12,235  $ 12,386  $ 12,590  $ 12,683  $ 12,785  $ 10,939
Intangible amortization expense   $ 392  $ 350  $ 359  $ 381  $ 344  $ 391  $ 204
Continued               
____________________               
*This is a Non-GAAP based financial measure. 
   
   
SOUTHWEST BANCORP, INC.   Table 6 
UNAUDITED QUARTERLY SUMMARY FINANCIAL DATA   Continued 
(Dollars in thousands except per share)   
   
   2010 2009
   Sep. 30   Jun. 30   Mar. 31   Dec. 31   Sep. 30   Jun. 30   Mar. 31 
LOAN COMPOSITION               
Noncovered               
Real estate mortgage:               
Commercial   $ 1,271,278  $ 1,251,709  $ 1,230,009  $ 1,212,409  $ 1,221,739  $ 1,208,819  $ 1,098,587
One-to-four family residential  109,980 106,814 111,185 114,614 125,034 116,068 114,111
Real estate construction               
Commercial  527,773 589,590 630,472 618,078 612,905 622,298 640,132
One-to-four family residential  30,527 35,129 34,996 41,109 39,009 51,292 79,309
Commercial  463,132 471,004 487,074 520,505 538,757 554,734 558,834
Installment and consumer:               
Guaranteed student loans  5,960 7,389 10,199 36,163 30,949 18,477 69,792
Other  39,014 39,328 38,048 39,550 40,244 41,548 41,932
Total noncovered loans, including held for sale  2,447,664 2,500,963 2,541,983 2,582,428 2,608,637 2,613,236 2,602,697
Less allowance for loan losses  (72,418) (67,055) (65,168) (62,413) (57,777) (51,753) (46,262)
Total noncovered loans, net   $ 2,375,246  $ 2,433,908  $ 2,476,815  $ 2,520,015  $ 2,550,860  $ 2,561,483  $ 2,556,435
Covered               
Real estate mortgage:               
Commercial   $ 33,428  $ 36,107  $ 37,487  $ 39,836  $ 37,820  $ 40,411  $ -- 
One-to-four family residential   10,071  10,277  10,843  12,630  17,246  17,889  -- 
Real estate construction               
Commercial   7,464  8,190  11,173  12,515  14,178  14,277  -- 
One-to-four family residential   1,823  3,853  5,273  5,324  9,936  13,647  -- 
Commercial   6,816  8,487  10,807  13,412  21,475  27,203  -- 
Installment and consumer:   956  1,092  1,326  1,688  2,975  3,669  -- 
Total covered loans   $ 60,558  $ 68,006  $ 76,909  $ 85,405  $ 103,630  $ 117,096  $ -- 
DEPOSIT COMPOSITION               
Non-interest bearing demand   $ 329,655  $ 326,721  $ 317,896  $ 324,829  $ 309,767  $ 291,014  $ 274,175
Interest-bearing demand  86,153 102,218 119,757 74,201 82,622 94,060 85,629
Money market accounts  518,422 510,549 506,659 505,521 506,196 483,162 467,924
Savings accounts  25,556 25,321 25,871 25,730 25,636 25,660 15,797
Time deposits of $100,000 or more  795,303 861,110 944,871 1,004,439 888,814 905,202 849,814
Other time deposits  590,559 619,020 639,111 658,010 660,127 653,197 636,750
Total deposits**   $ 2,345,648  $ 2,444,939  $ 2,554,165  $ 2,592,730  $ 2,473,162  $ 2,452,295  $ 2,330,089
LOANS BY SEGMENT               
Oklahoma banking  $ 890,598 $ 914,004 $ 926,870 $ 933,150 $ 943,982 $ 967,981 $ 949,454
Texas banking  1,024,863 1,041,228 1,063,511 1,054,404 1,042,369 1,037,694 990,135
Kansas banking  309,240 329,157 342,596 359,633 400,710 412,314 309,774
Other states banking  248,653 258,965 260,329 277,512 288,680 286,337 276,930
Subtotal  2,473,354 2,543,354 2,593,306 2,624,699 2,675,741 2,704,326 2,526,293
Secondary market  34,868 25,615 25,586 43,134 36,526 26,006 76,404
Total loans  $2,508,222 $2,568,969 $2,618,892 $2,667,833 $2,712,267 $2,730,332 $2,602,697
NET INCOME BY SEGMENT               
Oklahoma banking  $ 3,624 $ 4,334 $ 2,820 $ 3,807 $ 2,529 $ 3,284 $ 3,210
Texas banking  (1,769) 697 1,656 3,591 2,686 3,662 1,119
Kansas banking  (227)  985 (355)  (2,328)  (1,180)  2,405 598
Other states banking  488 (507)  1,722 300 57 (78)  (1,974) 
Subtotal  2,116 5,509 5,843 5,370 4,092 9,273 2,953
Secondary market  219 72 327 (3)  (201)  117 (61) 
Other operations  1,538 (1,170)  (1,798)  (1,793)  (1,757)  (3,445)  (1,563) 
Net income  $ 3,873 $ 4,411 $ 4,372 $ 3,574 $ 2,134 $ 5,945 $ 1,329
OFFICES AND EMPLOYEES               
FTE Employees   440  447  455  466  471  478  425
Branches   23  23  24  24  24  24  18
Loan production offices   2  2  2  3  3  3  3
Assets per employee  $ 6,603 $ 6,736 $ 6,758 $ 6,670 $ 6,432 $ 6,358 $ 6,890
____________________               
**Calculation of Non-brokered Deposits and Core Funding (Non-GAAP Financial Measures) 
Total deposits   $ 2,345,648  $ 2,444,939  $ 2,554,165  $ 2,592,730  $ 2,473,162  $ 2,452,295  $ 2,330,089
Less:               
Brokered time deposits   226,238  279,027  359,571  417,419  327,951  395,196  454,435
Other brokered deposits   129,096  126,643  124,969  127,320  125,737  125,666  124,674
Non-brokered deposits   $ 1,990,314  $ 2,039,269  $ 2,069,625  $ 2,047,991  $ 2,019,474  $ 1,931,433  $ 1,750,980
Plus:               
Sweep repurchase agreements   22,211  22,700  33,192  23,259  26,500  35,708  24,963
Core funding   $ 2,012,525  $ 2,061,969  $ 2,102,817  $ 2,071,250  $ 2,045,974  $ 1,967,141  $ 1,775,943
               
Balance sheet amounts are as of period end unless otherwise noted. 
   
   
SOUTHWEST BANCORP, INC.   Table 7 
UNAUDITED QUARTERLY SUPPLEMENTAL ANALYTICAL DATA   
(Dollars in thousands except per share)   
   
   2010 2009
   Sep. 30   Jun. 30   Mar. 31   Dec. 31   Sep. 30   Jun. 30   Mar. 31 
PERFORMANCE RATIOS               
Return on average assets (annualized)  0.52% 0.58% 0.57% 0.46% 0.28% 0.81% 0.18%
Return on average common equity (annualized)  3.57 4.64 5.42 4.06 1.78 8.26 0.50
Return on average tangible common equity               
(annualized)*  3.65 4.75 5.58 4.17 1.83 8.51 0.52
Net interest margin (annualized)  3.63 3.65 3.59 3.71 3.39 3.41 3.00
Total dividends declared to net income  22.59 19.84 20.02 34.31 57.46 20.58 92.00
Effective tax rate  28.02 38.29 39.19 36.22 37.33 37.75 34.66
Efficiency ratio  47.02 51.97 49.25 49.69 53.34 46.32 53.06
NONPERFORMING ASSETS               
Noncovered               
Nonaccrual loans   $ 135,209  $ 111,871  $ 97,858  $ 105,887  $ 94,715  $ 74,205  $ 73,383
90 days past due and accruing  452 333 4 310 10,578 8,409 10,552
Total nonperforming loans  135,661 112,204 97,862 106,197 105,293 82,614 83,935
Other real estate  35,723 27,634 18,809 18,432 6,389 6,003 5,351
Total nonperforming assets   $ 171,384  $ 139,838  $ 116,671  $ 124,629  $ 111,682  $ 88,617  $ 89,286
Performing restructured   $ 5,334  $ 5,525  $ 5,650  $ --  $ --  $ --  $ --
Potential problem loans   $ 236,844  $ 242,217  $ 275,912  $ 258,399  $ 255,051  $ 178,081  $ 133,810
Covered               
Nonaccrual loans   $ 7,906  $ 14,504  $ 16,192  $ 12,322  $ 14,686  $ 8,607  $ -- 
90 days past due and accruing  1,871  130  356 1,136 4,544  3,658  -- 
Total nonperforming loans  9,777  14,634  16,548 13,458 19,230  12,265  -- 
Other real estate  4,448  4,352  4,489 4,748 2,598  2,938  -- 
Total nonperforming assets   $ 14,225  $ 18,986  $ 21,037  $ 18,206  $ 21,828  $ 15,203  $ -- 
Potential problem loans   $ 6,413  $ 6,184  $ 6,620  $ 8,874  $ 4,421  $ 5,977  $ -- 
ALLOWANCE ACTIVITY               
Balance, beginning of period   $ 67,055  $ 65,168  $ 62,413  $ 57,777  $ 51,753  $ 46,262  $ 39,773
Charge offs   7,006  6,168  6,545  6,756  4,372  2,975  4,810
Recoveries   381  279  769  752  219  989  417
Net charge offs   6,625  5,889  5,776  6,004  4,153  1,986  4,393
Provision for loan losses   11,988  7,776  8,531  10,640  10,177  7,477  10,882
Balance, end of period   $ 72,418  $ 67,055  $ 65,168  $ 62,413  $ 57,777  $ 51,753  $ 46,262
ASSET QUALITY RATIOS               
Noncovered               
Nonperforming assets to portfolio loans and other real estate  7.00% 5.59% 4.60% 4.87% 4.33% 3.41% 3.53%
Nonperforming loans to portfolio loans  5.62 4.53 3.89 4.18 4.09 3.19 3.32
Net loan charge-offs to average portfolio loans (annualized)  1.07 0.94 0.93 0.92 0.61 0.31 0.71
Allowance for loan losses to portfolio loans  3.00 2.71 2.59 2.46 2.25 2.00 1.83
Allowance for loan losses to nonperforming loans  53.38 59.76 66.59 58.77 54.87 62.64 55.12
Covered               
Nonperforming assets to portfolio loans and other real estate  21.88% 26.24% 25.84% 20.19% 20.55% 12.67%  -- 
Nonperforming loans to portfolio loans  16.14 21.52 21.52 15.76 18.56 10.47  -- 
CAPITAL RATIOS               
Average total shareholders' equity to average assets  12.85% 11.78% 10.18% 10.31% 10.24% 10.35% 10.47%
Leverage ratio  14.96 14.48 12.32 12.42 12.39 12.70 12.72
Tier 1 capital to risk-weighted assets  17.17 16.50 14.00 13.28 13.04 12.67 12.85
Total capital to risk-weighted assets  18.45 17.78 15.28 14.55 14.31 13.92 14.11
Tangible common equity to tangible assets***  10.43 10.02 7.87 7.61 7.79 7.65 7.76
REGULATORY CAPITAL DATA               
Tier I capital   $ 442,188  $ 438,973  $ 381,280  $ 377,418  $ 374,805  $ 372,713  $ 369,482
Total capital   475,040  472,971  415,955  413,438  411,201  409,764  405,613
Total risk adjusted assets   2,574,746  2,659,886  2,722,628  2,841,476  2,873,558  2,942,821  2,875,290
Average total assets   2,955,779  3,032,328  3,094,756  3,039,014  3,024,885  2,935,189  2,905,653
____________________               
***Calculation of Tangible Capital to Tangible Assets (Non-GAAP Financial Measure) 
Total shareholders' equity   $ 376,576  $ 375,319  $ 315,341  $ 309,778  $ 309,118  $ 305,416  $ 300,406
Less:               
Goodwill   6,811  6,811  6,811  6,811  6,811  6,811  7,071
Preferred stock   67,548  67,375  67,205  67,037  66,872  66,710  66,549
Tangible common equity   $ 302,217  $ 301,133  $ 241,325  $ 235,930  $ 235,435  $ 231,895  $ 226,786
Total assets   $ 2,905,275  $ 3,010,835  $ 3,074,923  $ 3,108,291  $ 3,029,347  $ 3,038,985  $ 2,928,133
Less goodwill   6,811  6,811  6,811  6,811  6,811  6,811  7,071
Tangible assets   $ 2,898,464  $ 3,004,024  $ 3,068,112  $ 3,101,480  $ 3,022,536  $ 3,032,174  $ 2,921,062
Tangible common equity to tangible assets  10.43% 10.02% 7.87% 7.61% 7.79% 7.65% 7.76%
               
Balance sheet amounts and ratios are as of period end unless otherwise noted. 
CONTACT:  Southwest Bancorp, Inc.          Rick Green, President & CEO          Kerby E. Crowell, EVP & CFO          (405) 372-2230

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