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BOKF BOK Financial

Participants
Steven Nell Executive Vice President and Chief Financial Officer
Steven Bradshaw President and Chief Executive Officer
Stacy Kymes Executive Vice President, Corporate Banking
Scott Grauer Executive Vice President, Wealth Management; CEO, BOK Financial Securities, Inc.
Marc Maun Executive Vice President and Chief Credit Officer
Ken Zerbe Morgan Stanley
Brady Gailey KBW
Peter Winter Wedbush Securities
Jared Shaw Wells Fargo
Jon Arfstrom RBC Capital Markets
Matt Olney Stephens
Gary Tenner D.A. Davidson
Call transcript
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Operator

Greetings and welcome to BOK Financial Corporation Fourth Quarter 2020 Earnings Conference Call. At this time, all participants are in a listen only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] I would now like to turn the presentation over to Steven Nell, Chief Financial Officer for BOK Financial Corporation. Please proceed.

Steven Nell

for thanks and morning, joining us. Good CEO, Stacy Kymes, our cover loan metrics. Steve Corporate Bradshaw, and comments, our credit and opening provide portfolio Executive will will Banking, Today Vice of President

regarding I'll and and expenses balance capital net Lastly, overall details interest net fee our a interest from position income, sheet standpoint. revenues, margin, liquidity provide

the Grauer, of us the question-and-answer credit Chief our Management, on can who pertaining Officer, the to questions company. Bradshaw. expand quarter for on website wealth fourth at make session and regarding our on any forward-looking bokf.com. Steve slide President two statements another Joining management have you the answer and the turn quarter metrics Executive who can PDFs disclaimers now Scott slide we call. We I'll presentation capabilities, also Credit the for Wealth call available led press release during are to Marc Vice fantastic detailed are our refer over Maun, to which of to

Steven Bradshaw

overstate and joining during pretax hurdles, full summary, flexibility year. us of and the record past quarter provides this again demonstrated organization economic our results. fourth for $XXX.X pre-provision million financial stress. XXXX strength our difficult XXXX persistence year times a A for morning, be to the diversified would year and punctuated it despite and thanks it to with discuss stability in of revenue Good the the once proved revenue strategy In

full income $XXX per capabilities our Start that provide $X.XX underscores it customers. net diluted and our the was four, the slide importantly, breadth value or share. service More of million on we year

two per million the margin represented the more credit year than loss elevated boom, business, our relevant the that this was broad-based but quarter. was trends drove it release pandemic of production first net And income ago. needed a quarter diluted X% expense linked success growth half strong The No XX% from starting the management to to quarter margins a modest following at of of control outset another decreased XXXX. that mortgage remain compression million record or of reserve. allowed did summer's quarter the measures combined the provision served and mortgage level $XXX.X at improving outlook as specifically levels team, the from $X.X quarter the in lastly, mortgage items wealth improving proactive in all and a us in though with from materialized quarter, the the our earnings same seasonality we continued share, basis credit a of fourth EPS Looking outstanding quarters last key our our for this economic were as took from fourth at quarter well in XXXX. March And as $X.XX to fact,

near-term. in trend over five, remains do momentarily, figures as enacted believe resume XXXX X% ago. year in wave in a of economy not up this include remains second growth quarter same challenging continue quarter as growth stimulus linked borrowers so economic Stacy to Deposit the in this rebound. a and XXXX, the up slide to but understandably reduce from XX% Those more Turning anticipate we excellent loan opportunities the over quarter late growth in to our the leverage cover detail continues do environment. we will the challenge will this

division. $XX XXXX, revenue management and as produced some increase in Needless of a trading revenue net record additional timing year the perspective in the our say client topping wealth or loan custody detail. billion up for sales Assets were on to on in the incredibly quarter, time in interest and in management team and wealth XX% turn trading to under company's deeper brokerage to starting proud provide an we little history fee shift a dive We'll but and our the as settlement impact. well are results quarter. the securities to metrics new first for before very management I'll in the over balances strong market portfolio favorable fourth will our the over more I'll in credit the our call Kymes Q&A Stacy. now due session, Stacy review of

Stacy Kymes

Steve. Thanks,

down X.X% period to loan quarter. in loans were $XX.X end seven, slide core for Turning portfolio our the billion,

quality the Steve quarter. has leverage uncertainty, been reduced in which mentioned, times of borrowers with borrowers this As case again economic our

the X.X% year. for energy portfolio, for quarter XX.X% and balances the the contract at Looking to

these the allows were While and factors, clients us a as commodity revenue down environment as support look retirement continue businesses by continue we just year. more challenge to quarter we was loans New system to growth decrease debt strategy diversified record housing this far client optimistic by Despite this in in for the paydown offset in considerably at related and into paydowns witnessed holistically. new loans. that the is Treasury, leverage. to energy level continue growth space. services hospital and existing to plan Healthcare in serve this reduce the are heading grow business remain our offset wealth Remember slightly sufficient have than deals lending to our as improved to current of Year senior lending sourcing a borrowers revenue revenue remains the management over base. energy prices last customers months, as personal balances energy And all energy our few hedging the

year-over-year, loans healthcare strong our credit For systems a from growth demonstrate X% who profile. up to the though, clients hospital year, primarily imbalances were due

balances expect the like our portfolio's migrate outlook has to should and once be Act near-term, normal healthcare the stimulus long-term growth pointed In credit the second they quarter. and Paycheck CARES a original again as bill environment. passed initially in month, the facilities would last Looking million believed over were forgiven be confident hospitals it we XXXX. it forgiveness a to declined enhancement April that in was forward, leader and manage process of revenue nursing PPP health it The nearly measures than just be beginning conditions current at the as Program through complex we growth the economic for of remain of in XX% out Protection more PPP multiple balances and state. more after or $XXX both the skilled

and of our apply reluctance for significantly The However, recent SBA business the has largest additional guidance the forgiveness, Aid for requirements or Economic processes XXX,XXX, application. the in as forgiveness they refinement existing substantial our administration of were from process will of required total volume. to Act more hopeful than than recent been less of especially requirements. legislative small relief, action, that time provide represents clients per PPP reduced relax with client's those The hurdle clarifying loans has months our XX% which continue would PPP

with us and to participate of round the to of in manner, PPP retention. resource on clients' the client leverage increasing in engagement, additional strategy thereby We newest focusing meet timely an client our will existing loyalty capacity will existing needs largely our same This allow base. extremely

are the loan for of the will XXXX. our we shape speed determining optimistic economic be outlook for growth. ahead, broader recovery loan and growth in Looking in factor The restarting

confidence and resulting serve to capital return well-positioned XXXX. will investment and in believe clients are we However,

view the the BOKF to loan of deferral status Turning slide across an see port. updated eight, you'll

small of status economic X.X% monitoring exposed in less be today, of the portfolio million for any pandemic. This of to is $X size The Of highly in a diversified million. the remains loans considered we've loans than just of closely portion see, portfolio can headwinds X.X% monitored, we'll credit to the list down and group $XX last to total but of type, of ongoing very increasingly compiled loans of is that segments deferral XXX loans this are with of vulnerable retail on most the outcomes markets average loans the recovery XX stimulus. deferral. loan loans pace more impact slide continue over from $XXX This you remain extended an due resilient. more eight, quality on well, this loan will of list are Also gaming, remain closely. the totaling status, vulnerable portions religious the considered deferral has portion including in quarter. and has our said better as stores, than continued portfolio of expectations, As the few short-term these economic Significant dependent very Long-term That positively. up convenience our originally additional colleges. and again were originally fiscal the migrate of organizations, proved held have performing exposures million retail loan borrowers

rebound energy quarter-end, loans non- an on Potential loans prices for real December improvement and problem $XX in reserve, The in improved re-determination annualized completed loss to loan or that totaled this XX XXXX. to significantly the increase see needed on quarter losses loans. attributed primarily energy was loan annualized nine, loan able million PPP our near third as slide million outstanding base The million resulted this in X.XX% credit quarter. down process saw well portfolio our since loan estate to X% but The due only reserve first outstanding for historical from by down with along potential within XX problem million and combined quarter, we XX. from the were our significantly net also you basis at Turning numbers, Non-accruing Net at excluding accruing were release of commercial term of loss the charge-offs $XXX combined quality the points, losses basis $XX.X energy stability to allocations points slightly quarter. in million quality of to can increased of borrowing energy allowance or allowance half credit XX we $XX.X million $XXX loans. charge-offs significant $XXX a portion Not September has XXXX basis or criticized points loans in reduced totaled XXth. totaled we experience. loans. loans in our commodity the quarter-end, company's to

still XXXX Looking is of points. too still far out. to we lower That XX a forecast range XX current advance, we the ahead historical believe perspective, line of based difficult of average to on today what charge-offs and basis know net will economic from assuming the of a in environment, end remain we the uncertainty lot credit our in on said, predict there's remain as our

Steven? level the this appropriate positive our generally more will COVID-XX have as case the quarter. the activity opportunity highlight balance NIM our broad vaccine XXXX, allowing regular dynamics, the for at we we quarter. continue XXXX, reserve a a potentially reserve call reserve important set Once clarity the I'll reductions, of this We're in Steven revenues around now to economic begin fee about year. release could distribution, to items in turn resumption of to have. I'll credit us see to and additional speed for over always outlook sheet we We the and release count

Steven Nell

environment. Stacy. of differentiated a clearly rate income consecutive is current a with revenue mitigating this net rate success for contributions coupled environment. management our second impact outcome our contributed the our quarter, in management record quarter, wealth expense to diligent low Thanks, Outsize team, With diversified this low strategy providing the

previous X more and quarter. the interest Turning a slide the quarter and basis fee down than XX, I'll X.XX%. for net the and revenue. in had impact interest interest interest from from was moment basis roll-forward business lower fees highlighting margin $XX customer customer net I emphasize third slide relates interest our the revenue trading points $XXX last CoBiz core margin, and million the portfolio a and from transactions. provided loans net third infrequently on quarter. revenue this sale in largely earned more margin slide X.XX%. the fourth on brokerage at net quarter trading up with increase more brokerage from fourth revenue, securities the $X.X of fourth but to interest in was to a recoveries quarter loan are to flows accretion from and in to quarter to interest quarter. higher our items. fees interest this in dollars net elevated an in to trading in as cash yield The transaction net Reinvestment this in revenue increase points continues describe shift significant Net fees trading million, billion was quarter, from increase net revenue level interest revenue quarter X.XX%, XX securities to forgiven the The PPP also the were from declining margin interest a shift net brokerage from the interest noted occurring available Other recorded were diluted from discount our portfolio of net a quarter. revenue

interest basis from deposit points basis costs continue last down driving quarter. XX this to Additionally, bearing XX points quarter success we to have

many of fees, recognition in the While continued further, portfolio of we'll room parts there PPP combination the the pressure down including moving and apply margin the bearing AFS and interest to to move are of interest consider, quarters. limited deposit future continued re-pricing to net costs

XX, in the revenue interest and to fees. see for the fee I our and Turning largely slide record earned that is interest the trading mentioned mortgage-backed can of being you net shift transaction revenue securities, trading to brokerage customer of of earlier. volume and its timing versus impact which resulted settlement revenues from the This accounted

another viewed together but holistically, were outstanding linked down the with year fees, third from for the wealth year quarter. team Additionally, represents quarter primarily was $X million, on highest saw total from million in full off total down decline spending. slowing quarter's $XXX That team When of record due new quarter, revenue revenue third quarter, management financial surpassed TransFund third first energy hedging by slightly in while contracts consumer still banner the put the to and our the quarter, help which institution level. our $XXX.X volumes for record, million the quarter for for record the a we this Transaction XXXX, a transaction driven mitigate should this said lower revenue had customer time. X.X% card year,

few flat to activity. are and with to XXXX banking value million the million rebound down of by a pandemic. $XX.X of the $XX.X to asset this revenue quarter, see times combination quarter industry In and to certain Fiduciary rate of due for compression, in in significant consistent economic our as low management expect seasonal linked following a management While as a increase activity $XX.X past in total, $X.X conversion XX in margins banking to That is improvement decreased were this company, quarter sales capacity declines primarily seasonality last quarter quarter the both pressure the the the favorable Mortgage all from for and time as driven typical said, though, was quarters. acting year under we midst increased mortgage Deposit in some given year. million charges of markets. and a mortgage for due of fees business, lengthily, we margin fair significant a fourth increasing service revenue which the still the elevated was top year XXXX for record million the offset margin a revenue waive quarter assets protracted last environment. constraints related the

fee the positive I mortgage down economic included for servicing quarter, in to on fees net partially quarters. has and businesses note not rights $X.X These businesses revenue from million the slide our due been success economic of changes that unprecedented were year. at on levels the Although, in levels XX, commissions the had shift fair hedges past was value clearly to the quarter. in the related and fundamental Though will this record this we've is statement, operating income important remember geography production the it few

will re-skilled to We to allocate resources fee continue employee key our revenue maximize capital to areas and opportunities.

slide prudent, to expense expenses with mostly Turning flat XX, linked remains total quarter. management

accounts quarter's in production be expense mortgage expenses level. a record the in million a by elevated $X.X in year-over-year, expense should Incentive from compensation based increased just offset for more decreased stock-based year. compensation decrease incentive deferred were down up incentive and than businesses, X%. over compensation related increase was more increase million our compensation total annual to combined as While and management last noted quarter this in that X% the $X.X linked total by wealth Personnel $X.X was than cash million

contribution decline BOKF in Additionally, million expense third there payroll we due due created advertising largely focus million expense charitable by up $X seasonal Business commercial position XX, $X.X from was the communities properties serve in $X estate decrease given taxes. we to million. and largely our a very increased to repossess expenses the due set over a employee Insurance increased and million expense a Non-personnel the of decreased to real retirement extreme $X.X while continued benefit expense We deposit $X contingencies continue to quarter. $X.X million in quarter, million and other of was the Foundation the while just made as and on the the by assets quarter. on costs in to increased needs typical dropped slide the X.X% pandemic. the gas on the Net recruiting decreased balances. third losses mortgage banking due strong, liquidity loss write-downs oil and expense expense, retail $X.X expenses. remains and costs also to On inflow million, properties promotion

at liquidity loan on is end XX% customer to quarter, significant deposit to providing of needs. last future compared XX% now Our ratio to sheet the balance meet

customer We XX reflected measures inflow expect continued the the stimulus were in figures. year to term near of December see deposit end as in a not deposits of

with common share of our levels were as capital market. open in again, an active per repurchase, we, of range. With once $XX.XX XX%, Our average price back remain the a operating Tier X ahead of buying such XXX,XXX strong healthy with shares well capital optimistically ratio well internal equity share levels

$X.XX. you with XXXX. We with we near growth general loan broader slowly in economic a increases accelerate for for outlook increase Additionally, in types reward into the recovery to environments. shareholders continue believe will the tandem On dividend we I'll of this as as XX, look of an slide leave mid-term our year. cash economic and we the company year to authorize This our XXth in consecutive varying the quarterly fourth the through is quarter dividend

single grow for of fourth the we activity. the we XXXX of think towards quarter, excluding digit low full in any PPP can the weighted range mainly year While loans quarter and third impact

yielded available sale portfolio, mortgage-backed during Our fourth which for securities agency largely is quarter. X.XX% securities the

could million low XX $XXX flows points. per quarter. those We can at basis around rates reinvest approximately sustained the cash reach to prepayments XX environment Given rate currently

well and noted, rate be room We could during quarter there had to zero success interest deposit quarters. further point during securities the costs costs are feel below we are we environment. deposit margin REITs costs minimal believe push we rates and of The near in last As room lower we low driving pressure but coming the combination a lower, further deposit to bottom. nearing reinvestment net at lower bit the will

portfolio impact in should stream provide revenue Our of being fee to revenue felt overall continue diverse spread some mitigating pressures to businesses. our

fee categories to trading in We be XXXX with and areas mortgage record expect most modestly XXXX, exception revenue difficult the replicate. businesses grow brokerage of those as year in the and to will

our to in and at digits personnel continue budgeted low single will growth controlling discipline We with costs XXXX. approach non-personnel

be competitive XXXX, continues get oil further line possible. to holding will sacrificing technology focus improve is If on manageable improve our customer the position. stability we service price additional release Our reserve and loss the without loan expenses and commitments multiyear economy to in

ago our a feel I strength. moment mentioned about As capital we good

opportunities We buyback we'll for share dividend commentary. cash our level. back Steve turn Bradshaw over will closing quarterly current and the for to maintain continue looking call now I'll

Steven Bradshaw

in of of has uncertainty. downside very been we employees, The and that our growth to Thank credit potential point shareholders. earnings pride differentiated for intentionally our share of say I'm of in that strategy. We risk XXXX Discipline for institutions, throughout the regional the our be built most BOK communities, such customers, economic investing our but outcome you, we delivered for a ultimate a to year businesses often lasting was should a years. company volatility that Financial for and to our proud have many challenging pressures financial test area's Steven. fee-based mitigate detrimental cycle underwriting times the of and

as to rebounds capital the an of see XXXX, along continue we investments. return business to with further clients market solid opportunity economy, that a ahead fee strategy to to with our resume our will confidence Looking lending deliver select expect them results. We to opportunities share motivate segments

our leadership XXXX diversified also proved of pleased we worked can your With questions. change challenges with economic our abruptly, management forecast the were the by the as pandemic. revenue While value model early to the experience along take team, through and of that, Operator? year brought showcase that we it

Operator

you. Thank

line Our now Stanley. session. be proceed conducting will the We Morgan Please Zerbe a [Operator comes question question-and-answer with of question. first Instructions] with Ken from your

Ken Zerbe

Thanks. Good guys. Great. morning right. All

Steven Bradshaw

Good morning.

Steven Nell

Good morning.

Ken Zerbe

And understood should the trying right how we additional of with is this to the was both in for I'm together. about Like, that -- is something this NII line. something and I to wanted how Just to fully -- what the trading this brokerage think is NII? going sure you that I make mean, initiated? level like -- happening just is sort it securities all comes Thanks. for guys

Steven Nell

Yeah. Ken, Steven. this is

in record settled our Mae was of There clients with some activity. it we those that balance the the trades facilitated of those think And from I on than previous a securities market trading dynamics. all we our securities was and clients. summertime Ginnie so traded securities with our more sheet

income so, versus through net interest transaction we revenue revenue. And fee that the earned

So, was shift $X in with securities market most for for the a trading our on over our assets part, quarter. billion the dynamic earning up average it

know of this maintained occur. fashion first in trading at a So, securities that be those year. will what into that of may don't know, the I would in kind lot part least But I the of future Scott may going suspect

Ken Zerbe

Gotcha.

Okay.

right I of you we maybe first and dynamics? way in it's about into and -- the quarter? I keeps the your go So things just trading second if like mean, NII much thinking to mean is should normal in then assume we at does more so back that since revenues And then said quarter, brokerage it and first the depressed -- only the third. going sounds should elevated, definition, guess all level also -- by that this stay that by that

Steven Nell

will in think the quarter like show really We more down we -- what think the this this brokerage I stay trading in don't care really do particular if just me in -- least part NII. as level. And together. our clients entire -- suspect at into the and look fee we or of But the occurs I at what revenue excuse stream in quarter, kind XXXX, will of this really recorded is up settles Well, revenues the we is And in trading may at -- least at with that our the maybe shifted follow to this fees. clients how would it's and more transaction the I in NII net record side. income it on the interest with it which bucket. year be first how activity

Ken Zerbe

Got it.

Okay.

I think that makes sense. And then just one last question for me.

Excluding for securities, your lower. right? all interest margin trading the Obviously, guidance the is net

Sounds of quantify modest up expect of growth, like the sizable maybe fairly the the impact should those pressure. half factors. On you be in the sort very amount of under kind like trading, Thanks. NII if on X I wondering was the it you can on year. back loan of based average, picking NII, sounds

Steven Nell

year. to migrate hard down. that a We it's we Well, securities in see do a available number you NIM at AFS will re-pricing charts the provide, little will natural in decline put the portfolio. of for if you I our securities at you to chart of Again, -- how I think the of pretty about off yields. that sale tried give because it bit worth I start that to can look the on in mean, a kind more with say X.XX%. much of core

quarter. this was to I basis quarters basis roll think XX It's XX to couple continue points going it a down. points of ago,

again in quarter. pushing interest And been costs. very this down bearing deposit our we've Now, successful

points. And it down can. of AFS room But we to was I the there's month was basis XX pushing think we December that basis I average re-pricing. fact, this In some points for Can XX quarter. securities to Perhaps don't about significant the downward? offset of think continue

just think interest margin. of net I natural there's a kind of downward migration So,

forward. of Of grow course, to half interest in we net loans focus back anything help particularly And revenue else. hope your we to year bring it the point, XXXX, margin certainly beginning going more the and the sometime is stabilize to on than second

Ken Zerbe

much. All right. Thank you very

Operator

the KBW. line your comes question Gailey with of from question. with proceed next Our Brady Please

Brady Gailey

Hey, thanks. guys. Good morning

Steven Bradshaw

morning. Good

Brady Gailey

securities. I inventory thought the to follow-up of trading on

billion So, I mean, we're now $X up at that.

Looking $X last billion, the that's billion. at to back billion between range $X.X couple of we're $X years, over now in and

it going normalize longer sounds $X but near like it's here this that back So, stay? level? does to $X that in to term, billion stay term, billion-ish Or to is the around

Scott Grauer

this Hi, is Scott.

from when quarter. throughout So, to the you the end a billion and to billion over in at $X.X the look $X.X that $X.X -- of I billion, would little billion bit billion the fourth the built QX trend XXXX at $X then $X QX, in

referencing. So, at to a volume total inside markets you're low that higher the depend levels reverting we the back at that look upon to But as for obviously flow look of will remain that don't level mortgage indicated that and themselves. we those you

Brady Gailey

of core balances down Okay. last ex All so, look kind then X% the loan helpful. like for three right. have been kind annualized. X% quarters or That's And you if those of in at to loan balances between PPP, it seems

and a here? this away you was you I can annualized. think shrinkage gives from quarter quarter linked the reversal growth modest confidence towards What some that loan see seeing down X% the

Steven Nell

you annualized of look largest our year-over-year XX% energy one biggest lending that is six annualized, of linked and Well, piece quarter segments are loans, it was X.X%. is down which I think almost of the points down --

So, not annualized, quarter. just linked

get energy going paydowns. we balances, close So, get think you're some with to if which you to, we're stability those

see maybe more it first think, in quarter may plateau to there. runoff the and -- a grow we I from we then hopefully began bit little

get growth. or happening book. of there. -- PPP deals the think need around you lot I seeing level out get we way off you also core see balance not to gave the year, just very really paydowns long of the and numbers stability we single assuming think the growth. you out work But we we've program, loan outpacing But think to sheet we're terms think that it's new its did growth of in the are that of We feel within the the well this there. a the we I of liquidity gotten second we I of I But year work need that in And are back competent before But deleveraging weighted low good that digit book. think that the you energy growth to for positioned some you activity then economic about,

Brady Gailey

you helpful. fairly think this All then active M&A. be people selectively year? the are How in businesses income active of fee XXXX M&A think me. That's -- banks in A to for you been over bank And a know BOKF right. do years. acquiring be year I do active relating to finally lot BOKF and has expecting will

Steven Bradshaw

is Steve. this Well,

that to think assumption see more I going your opportunities. we're is M&A accurate

you If time environment see some that in to open to to when low headwinds, go obviously sellers be among you rate revenue leads desire a and conversation. back

an well. continue that that [ph]. the at opportunities we'll So, primarily see present throughout those that as would opportunity things to prioritizing maybe that's XXXX, selective look deferral themselves coming And be we within

Brady Gailey

Great. Thanks right. guys. All

Operator

with question next Peter comes of question. line proceed Securities. from the Wedbush Please your Winter Our with

Peter Winter

morning. Good

Steven Bradshaw

Good morning.

Peter Winter

to of reserve heading obviously, was you ratio with So, about could you you the see Do January see doing really the loan way guys it X.X%. outlook, economy the that X that are the well get towards this Do to year? the front end credit the back on which and improving. level,

Marc Maun

continued X.X%. we've one all in vaccine seen be Maun. I'm If cases outlook, outlook And see months. XXXX day our adjustment continuing improve, Marc essentially is back likely dramatically results you the pandemic economic if see you is recent you to seeing improvement what with that would seem at be January drop things is stable, prices along like I'm and was those that achieved And to recover energy occur. amount looking see if that, and this the Peter, you the the

a of lot ifs forecast. Of in course, still there's that

Peter Winter

Steven, in help that second would to that get And of the this year? the do half you half in think a year, more Okay. the lead loan of then, margin if growth second -- closer you of stable

Steven Nell

going going I securities it's you when help the Yeah. balances, it NIM earnings assets loan into your or mean, more to Certainly forward. would. from away certainly remix support

Peter Winter

can will this decline Okay. year record strong. one be It's more Mortgage little, banking but mortgage to a If in I had still year. just question. a expected sneak

outer therefore, business growth have the market -- slowly? even like years, business see and you should that XXXX above mortgage you a the banking into As we out with has seen you've look taken level, still so share, this

Steven Bradshaw

Yeah. is this Peter, Steve.

in good XXXX pretty quarter, kind a steady fourth think in mortgage outlook our of I probably is proxy. state a

-- increase some kind think in as there's in a we do, that see and gain that. market typically refi probably -- one do and purchase group share invested City market us, got Colorado paid have in Arizona, we'll more Oklahoma. off I quarter activity producers Texas we've really that of et a an kicks and and stronger cetera, outside after for Although, been little of us. much for Kansas We've Mexico, New because that stronger in of

five of mirror mortgage And where it's kind market share we those my in in that's that in mind probably ago. of with reflects expansion to a think small years did relatively I have been. that good think So, three all today our a the better I than markets. has to company And it upside

Peter Winter

questions. my taking for Thanks Okay.

Steven Nell

Peter. Thanks

Operator

line Please the proceed from your comes Fargo. with question of next Wells Jared questions. Shaw Our with

Jared Shaw

morning, Good Hi. everybody.

Steven Bradshaw

morning. Good

Jared Shaw

guess, we on the level? help, allowance or energy slow back expect of to quarter you go to provision that level, the that did should releases overall through just the as what sticking use on lower qualitative and the overlays that I we book qualitative that overlay reserve did this really guess, year, book? type reserve reduces I get with And

Marc Maun

from reallocation our did in more Maun. than we -- that still stimulus overlays we this reduce in in smaller took last has of CRE a energy is a Again, key number mass we been we particularly But down a did in that that where reserve Yeah. look And look other and was areas concerns certainly some reduction quarter. improved. areas, qualitative hard certain We X.X% obviously occur. issues and did businesses may certain not factor the Marc reserves. have X.X% with regard could may the to areas, at at or Yes, to have

of we economic in them how the and term, so, And the short activity thoughtful want credits the on we're on depending performance basis, about make at quarter-by-quarter how evolves. we're a then evaluate to sure looking

Stacy Kymes

pace was in general the what activity that but see as given is our change. improvement certainly do are cycle, much is economic the think case it recovery, than more the into we counts where your we And and on in get point. thesis could did, and in I more of premature economic But that visibility we to view vaccinations that declines

Jared Shaw

That's at liquidity Okay. is can that's you there existing Or you out that's really really do then, drive need absorbed to absorbing to -- do prices once just start energy looking growth? additional organic it And driving that and Thanks. a book, color. from good energy the that think that go growth? higher here

Stacy Kymes

spot grow those being spot we're kind then are -- that you that from in of of bad doing particularly we an our I XX where from in about in -- leading area grow not continue those to can mean, stable kind we perspective, can mean, is if new oil Permian, profitably. be deals certainly once and find a I kind area stable and XX, decent We're that's deals. terms being of a here. think people many price between think the of here. a deals. I in, do of But is There a We're that spot, this we We're done. to

energy we'll So, just grow some really at from will -- to we energy that borrowers and XXXX that I I think that's point really work that good to the think come or opportunity And deleveraging slow pace is XXXX. but hard that we're see there. It's of our are team second see doing all going if to surface. quarter the see to quarter, know see in don't I -- going first that. we the

Jared Shaw

Okay. then just for finally And me.

we to for potential saw potential PPP How think round? size compared of of as The we first the you loan the size that in what started. well should has maybe as about the second average round

Stacy Kymes

by I million just that. caveats think or to revenue is Well, mean, lower. things like it, going $X I of and be speaking loan declines around nature it's generally size maximum about the

are factors. our original the working participate other size will we be it of loan that hard very the of to to that active, as that won't participating, program the help themselves be don't PPP that. constraints to as the it We much original But going of in program because the size around size was. foresee certainly to So, be customers who avail can

Jared Shaw

billion should mean, thinking be we say? or if over the billion you $X time too I just were around early $X to first

Stacy Kymes

to SBA. mean, from say. even I new coming It's we're there's too rules just the governing early the yesterday, -- out program that are

So, any hard I awfully prognosticate point. think level of clarity at it's this with to

Jared Shaw

Okay. Great. Thank you.

Operator

comes line question. Jon with next with Markets. Our Capital proceed your RBC of from the Please Arfstrom question

Jon Arfstrom

guys. Thanks. Good morning

Steven Bradshaw

morning, Good Jon.

Jon Arfstrom

on Stacy, slide Question for you, seven.

growth, might if on this up and maybe the touch in later can energy. on contributors picking other in in a the that the terms of months, to year, loan touched loan bit think factor But growth roll we you XX forward big like more sounds what you You it is little biggest categories? thing be a

Stacy Kymes

the you stable think Well, I months, I think, XX categories. all thing got you've if mean, loan -- I commodity if you of roll prices. this get forward

going energy maybe be growing better. to digits, a You're mid bit single little

Our healthcare proud that well, book really team. really of doing is

growth that really good And there do that paydowns this saw senior there I are poised really -- given we but have really You in think, systems that just -- loans, some which quarter, large liquidity masked some to hair businesses, C&I was in our situation was from there housing. as their a well. very backup health

of real PPP one how the got we that executed. we the benefits from original think is strongly I

have C&I normal can believe of treasury that's opportunities on ability turn call you the for market And to new going relationship which a you that, the in executed out. call so, we've and into relationships. And the that and kind that we somebody create and really us been need help able really once times side, we a to again, of to some banker because the and level have looks of

optimistic once over is the to three kind that's for that pace, is you time, of benchmark a how at horizon of with will, growing very business of to get kind have. long us we we it we're two of if so, And normal mix which reasonable kind we GDP, times that a that

faster United also the -- a to States. footprint. some We footprint rest not we're we're states mean, in have are of that great than I grow the going

perspective geographic likely we're So, to think benefit Colorado, from about a than you core well-positioned economy. national from if and disproportionately grow as those Arizona to Texas the economies state's are growth and faster

Steven Bradshaw

lines that. It's would add credit, I'll et utilization that to to decline which of is thing reduced you of improves, economic did that. cetera, see activity. the just will expect the see we big a part as perspective in the utilization that C&I from that one we'll increased And contribute on

Jon Arfstrom

Good. right. All

you just life early I of those guess particularly from up my of would couple building? knocked seeing But optimism are general, guess footprint? some aside are you it markets, is -- the there. but of in in of But a is You which I signs seeing good. happening, better questions energy, signs the in and the pipelines

Stacy Kymes

the of the think going to it's in that think off growth. think of liquidity I our C&I around core to But think near-term. some you struggle that's mean, up some see you're huge don't going until I we in see borrowers, began really work I healthcare work to We're some seeing to off, I I until among -- housing. senior liquidity built -- you're really loan begin to this

think I premature it's perspective. from So, our

lead are up a would kind There not activity bubbling to near-term. C&I have imminent perspective. us yet loan core seen of from We in that growth believe the of economic our

Jon Arfstrom

one credit. resolution full the on And with of of to the for that the slide the then those the and you year? that NPLs energy on what At offerings is particularly end show expecting against credits you're just quick some lower one nine, charge path

Steven Nell

as will themselves out. We'll work work each one through those

benchmark which couple the tell guidance in XXXX, end comfortable think in that is that to I be would -- range. think try They decent charged at net often a get of kind I charge-off low we one, XXXX. very we've historical things. with I a provided, you Number of that what the what we're would be look

think I on those we've price a the rising energy loans. difference commodity is got too

resolve environment And and totally energy stable and a continue in is rising fall. price loan when to so work prices trying different a to story then out

from achieve. bit can is work think one And provided so, outs question environment I some opportunity us to the environment and price relatively we those will slightly because through optimistic is optimistic outperform as those guidance hope an you certainly certainly of think There will non-performing work that be helps providing our And that the the loans. that be that, rising those. think our way I about to we're even is, environment a a And we're of the mitigate But really that those losses in that benefit. we we I to come that's will stable that.

Jon Arfstrom

Got it.

Okay. you. Thank

Operator

with Please Olney question next from Our with Matt proceed line of question. Stephens. the comes your

Matt Olney

morning. you out Good expenses there. about want ask I put And and to Yeah. the the that question. guys operating guidance thanks taking for

Trying operating good. more to digit to the achieve $X.XXX to Any low point. XXXX. in looking Is you want expenses XXXX. in billion that. single right growth details keep of on right? how the expect that sure I I'm really to starting that Sounds we're apples-to-apples at in make And

Steven Nell

Yeah.

to of difficult mainly So, a trying more our what is we in working our business And that try and control the revenue each think, level competitiveness addresses in that products detailed budgeting our in over with promotion, the discipline. November, environment. this expense But face that of it's the little is Steven. board. just work We it spending maintain to lot just hard, bit expense worked I IT, line can all to and and the maintain maintain personnel over fall services -- efforts because across of we It's determine addresses and how with want to to to clients. provide on our of want it we business a comes and we maintain right

Matt Olney

the third above appetite or quarter quarter, well the prices executed excuse fourth stock me? the And you in -- what the for Okay. now curious buyback, then were on buyback the that I'm levels is

Steven Nell

it quarter. we'll price buy I'm not that above at going the we were at then happy fourth market. that. we at And mean, in or about says though that a discount to to below the shares we I our mean, We'll it execution level Yeah. look closely. XX% bought and there buy won't put a I this out of today's

across I there think and a So, I levels, we opportunities the our market but to have at we -- for look is the advantage to it relative and opportunity. we take good relative wherewithal appetite capital capital still capital see we think when an to have

Matt Olney

And the Okay. you of here? missed may the on level fees you PPP have with fourth quarter it, of recognize that PPP, -- the and in disclosed fees it. and from What just I the remaining to the was amount the then, recognize

Steven Nell

Yeah.

quarter and fourth net in recognized we from PPP in $X.X million revenue So, in the million $XX.X fees.

about a fee the side. $XX side. the on million -- remaining So, $XX.X And of million have we total in fee on roughly the

Matt Olney

it. Got

Thank Okay. you, guys.

Steven Nell

Thank you.

Steven Bradshaw

you, Matt. Thank

Operator

D.A. question of with next Davidson. from Tenner with the Gary line Please comes your Our proceed question.

Gary Tenner

relates to year. loan Hi. the I things, Good year stabilization a were just it positive for growth of a morning. but or next answered, The growth loan as again side questions book in understand this largely certainly obviously energy would be

are and but was for pockets any you're you terms this pick answered I up others? increase geographically -- asked some in seeing where activity seeing there to than more degree, there? Are the any In general business of pipelines think

Stacy Kymes

Not not point. this particularly, at

based the portfolio point on Marc of which one borrowing that earlier, made in Keep C&I the driven. mind the think our is I C&I portfolio I that most is think is. best

types receivable, accounts inventory, things. of it's So, those

is pretty to utilization on our pre-pandemic. in were relative a that, So really particularly low basis where we

pipeline that who then for that's as receivable PPP earlier done broadly there us has others really may began organically. to well. up and those our people again, opened So, borrowers there's an opportunistic relationships as think, we've also growth work utilization with grow balances and just for as for higher the multiple I've as opportunity growth inventory from have with opportunity mentioned around a organically banking come But that back grow the to an

And we're begins C&I once well-positioned that turn grow that think core so, to the to economy around portfolio. I

Gary Tenner

briefly energy Okay. the And just book. on

quarter they versus are give are about, new the leading. that you participating there segment talked there, originations Can You in deals sense us out a or paydowns? of for in

Steven Nell

with we've handful exceeded new Certainly we deals originations, of associated receive in that. marketplace. the that and new revenue have that were don't lead but fourth in today. those a of deals the quarter fee than paydowns the I far more many done the And

So, we're optimistic.

I just if And bottom quarter don't I see we do close. the the know is second deleveraging? think get when But from think first that's it we're the really or of I I can to we quarter. here. question think

Gary Tenner

questions. Thanks right. for my All taking

Steven Bradshaw

Thank you.

Operator

the further no Mr. I'd over questions to the to closing back hand are There call Nell queue. for in like remarks.

Steven Nell

Okay. for morning. joining BOK Thanks appreciate interest this your again We Financial. everyone us in

us (XXX) Have can email have us If at questions, ir@bokf.com. call you you. XXX-XXXX. further great you day. a any Thank at please Or

Operator

conclude your Ladies this you today's gentlemen, for participation. does teleconference. Thank and

a disconnect your at wonderful may lines time this and have day. You