Profile: BOK Financial Corp (BOKF.O)
25 Nov 2015
BOK Financial Corporation (BOK Financial), incorporated on October 24, 1990, is a financial holding company. BOK Financial offers full service banking in Oklahoma, Texas, New Mexico, Northwest Arkansas, Colorado, Arizona and Kansas/Missouri. BOK Financial operates three principal lines of business: Commercial Banking, Consumer Banking and Wealth Management. Commercial Banking includes lending, treasury and cash management services and customer risk management products for small businesses, middle market and commercial customers. Commercial Banking also includes the TransFund electronic funds network. Consumer Banking includes retail lending and deposit services, lending and deposit services to small business customers served through the retail branch network and all mortgage banking activities. Wealth Management provides fiduciary services, private bank services and investment advisory services in all markets. Wealth Management also underwrites state and municipal securities and engages in brokerage and trading activities. At December 31, 2014, the Company reported total consolidated assets of $29 billion.
For the year ending December 31, 2014, Commercial Banking contributed $166.1 million, Consumer banking contributed $36.9 million and Wealth Management contributed $21.4 million to consolidated net income. Consumer banking services are provided through four primary distribution channels: traditional branches, the 24-hour ExpressBank call center, Internet banking and mobile banking. Consumer banking also conducts mortgage banking activities through offices located outside of its consumer banking markets, through correspondent loan originators and through HomeDirect Mortgage, an online origination channel.
BOKF, NA, a wholly owned subsidiary bank of BOK Financial, operates TransFund, Cavanal Hill Investment Management, MBM Advisors and seven banking divisions: Bank of Albuquerque, Bank of Arizona, Bank of Arkansas, Bank of Kansas City, Bank of Oklahoma, Bank of Texas and Colorado State Bank and Trust. Other wholly owned subsidiaries of BOK Financial include BOSC, Inc., a broker/dealer that engages in retail and institutional securities sales and municipal bond underwriting, and The Milestone Group, Inc., an investment adviser to high net worth clients.
The Company’s loan portfolio includes commercial loans, commercial real estate loans, residential mortgage and consumer loans. The aggregate loan portfolio before allowance for loan losses totaled $14.2 billion at December 31, 2014.
Commercial loans represent loans for working capital, facilities acquisition or expansion, purchases of equipment and other needs of commercial customers primarily located within the Company’s geographical footprint. Commercial loans are underwritten individually and represent on-going relationships based on knowledge of the customer, the customer’s industry and market. While commercial loans are generally secured by the customer’s assets, including real property, inventory, accounts receivable, operating equipment, interests in mineral rights and other property and may also include personal guarantees of the owners and related parties, the primary source of repayment of the loans is the on-going cash flow from operations of the customer’s business.
Commercial real estate represents loans for the construction of buildings or other improvements to real estate and property held by borrowers for investment purposes. The majority of commercial real estate loans are secured by properties within the Company’s geographic footprint, with more concentrations in Texas and Oklahoma, 34% and 16% at December 31, 2014. Commercial real estate loans totaled $2.7 billion or 19% of the loan portfolio at December 31, 2014.
Residential mortgage loans provide funds for its customers to purchase or refinance their primary residence or to borrow against the equity in their home. Residential mortgage loans are secured by a first or second-mortgage on the customer’s primary residence. Consumer loans may be secured by automobiles, recreational and marine equipment or other collateral, or may be unsecured.
The Company maintains a securities portfolio, including the United States Government agency obligations, the United States agency residential mortgage-backed securities, municipal and other tax-exempt securities, and other trading securities. The available for sale securities portfolio is $9 billion at December 31, 2014.
Sources of funds
The primary sources of liquidity for BOK Financial are cash on hand and dividends from the subsidiary bank. Deposits and borrowed funds are the primary sources of liquidity for the subsidiary bank. BOK Financial’s subsidiary bank relies on other financial institutions and the Federal Home Loan Bank of Topeka as a significant source of funds.
BOK Financial’s funding sources primarily include deposits and borrowings from the Federal Home Loan Banks and other banks. Based on the average balances for 2014, approximately 73% of the Company’s funding was provided by deposit accounts, 12% from borrowed funds, 1% from long-term subordinated debt and 11% from equity.
Deposit accounts represent the Company’s largest funding source. Period-end deposits totaled $21.1 billion at December 31, 2014.
BOK Financial Corp
Bank Of Oklahoma Tower
Boston Avenue At Second Street
TULSA OK 74172