BOK Financial Revenue Growth Provides Solid Earnings in 3Q

BOK Financial Corp. reported earnings of $56.7 million, or $0.84 per diluted share, for the third quarter of 2008.
The company reported a net loss of $1.2 million, or $.02 per diluted share, for the second quarter of 2008 and net income of $59.8 million, or $0.89 per diluted share, for the third quarter of 2007.
Transactions related to the SemGroup LP and Lehman Brothers bankruptcies increased net income by $4.5 million, or $0.07 per diluted share, for the third quarter of 2008 and decreased net income by $57.0 million, or $0.84 per diluted share, for the second quarter of 2008.
Year-to-date net income totaled $117.8 million, or $1.74 per diluted share, for the nine months ended Sept. 30, 2008 and $166.5 million, or $2.46 per diluted share, for the nine months ended Sept. 30, 2007.
“BOK Financial is pleased to report solid earnings for the third quarter of 2008, a period of great uncertainty,” said President and CEO Stan Lybarger. “Despite continued disruptions in the financial markets, our capital position and liquidity remain strong. Net interest revenue and fee revenue provided a foundation for our earnings while credit reserves increased.
“Our loan portfolio grew by $162 million, and we funded almost $350 million of residential mortgage loans during the third quarter,” he said. “We increased deposits by more than $460 million and our tangible capital is among the strongest in the country.”
Highlights of the third quarter of 2008 included:
? Net interest revenue totaled $164.3 million, up $5.4 million over the second quarter of 2008 and $24.9 million over the third quarter of 2007. Net interest margin was 3.48 percent for the third quarter of 2008, 3.44 percent for the second quarter of 2008 and 3.27 percent for the third quarter of 2007. Growth in net interest revenue and net interest margin was due largely to increased earning assets and widening spreads.
? Fees and commissions revenue totaled $126.7 million for the third quarter of 2008, $63.6 million for the second quarter of 2008 and $103.7 million for the third quarter of 2007. Fees and commissions grew $16.9 million or 16 percent over the third quarter of 2007, excluding SemGroup and Lehman related items, due largely to brokerage and trading revenue. Fees and commissions decreased $2.4 million, excluding SemGroup and Lehman related items, from the second quarter of 2008.
? Combined reserves for credit losses totaled $209 million, or 1.65 percent of outstanding loans, at Sept. 30, 2008, up from $177 million, or 1.41 percent of outstanding loans, at June 30, 2008. At Sept. 30, the ratio of reserves to outstanding loans exceeded the median of BOKF’s defined peer group. Net loans charged off and provision for credit losses were $20.2 million and $52.7 million, respectively, for the third quarter of 2008. Net loans charged off and provision for credit losses were $39.0 million and $59.3 million respectively for the second quarter of 2008 and $4.9 million and $7.2 million, respectively for the third quarter of 2007.
? Non-performing assets totaled $252 million or 1.98 percent of outstanding loans and repossessed assets at Sept. 30, 2008, up from $181 million or 1.45 percent of outstanding loans and repossessed assets at June 30, 2008. The increase in non-performing assets included an expected $36 million of unpaid amounts due from SemGroup in settlement of funded letters of credit and derivative contracts which terminated during the third quarter.
? The company maintained strong Tier 1 and tangible capital ratios of 9.25 percent and 7.16 percent, respectively, at Sept. 30, 2008. Tier 1 and tangible capital ratios were 8.69 percent and 7.15 percent, respectively, at June 30, 2008. At Sept. 30, 2008, the company’s tangible capital ratio was near the top quartile of 50 largest U.S. banks. The company paid a dividend of $15.2 million or $0.225 per common share during the third quarter of 2008.
International Bancshares Corp. reported net income for the first nine months of 2008 of $100.4 million, or $1.46 per share – basic ($1.46 per share diluted) compared to $85.9 million, or $1.24 per share – basic ($1.23 per share diluted) for the first nine months of 2007, which represents an increase of 18.7 percent in diluted earnings per share and 16.9 percent in net income.
Net income for the third quarter of 2008 was $33.9 million or $.49 per share – basic ($.49 per share – diluted) compared to $32.7 million or $.47 per share – basic ($.47 per share – diluted) for the third quarter 2007, which represents an increase of 4.3 percent in diluted earnings per share and 3.7 percent in net income.
Net income for the first nine months of 2007 was negatively impacted by an impairment charge of $13.1 million, after tax, on certain investments. A significant portion of the impairment charge was the result of the company’s strategic identification of certain investment securities sold in 2007 with the proceeds from the sales used to reduce Federal Home Loan Bank borrowings.
Total assets at Sept. 30, 2008, were $11.5 billion compared to $11.2 billion at Dec. 31, 2007. Total loans were $5.7 billion at Sept. 30, 2008 compared to $5.5 billion at Dec. 31, 2007. Deposits were $7.0 billion at Sept. 30, 2008 compared to $7.2 billion at Dec. 31, 2007.
The editors of American Banker will present J. Mariner Kemper, chairman and chief executive of UMB Financial, with its Community Banker of the Year Award.
Peyton R. Patterson, chairman and chief executive of NewAlliance Bancshares Inc., and Kenneth P. Wilcox, president and chief executive of SVB Financial, will also receive the honor at the Banker of the Year awards gala on Dec. 4 at the Plaza Hotel in New York.
Since 2004, Kemper has led Kansas City-based UMB Financial, a bank widely viewed by analysts and investors as one of the country’s best-run banking companies.



Was this article helpful?

Related Articles

Leave A Comment?