TULSA, Okla., Oct. 24, 2018 (GLOBE NEWSWIRE) --

CEO Commentary

Steven G. Bradshaw, president, and chief executive officer, stated, “This is yet another record quarter for BOK Financial, with continued growth in both our loan portfolio and net interest revenue. We added $346 million in new loan production to last quarter’s record loan growth. The competitive ability and scale of our wealth management business allowed us to earn a $15 million fee in client asset management. These factors, combined with a stable credit environment and diligent expense management, cause us to see earnings leverage continuing.”

Bradshaw added, “We are proud to have closed our acquisition of CoBiz Financial on October 1st in record time, in part due to our strong community engagement track record and Outstanding CRA rating. We welcome CoBiz employees into our organization and look forward to many great things to come. The combination of CoBiz and BOK Financial creates the premier commercial bank in Colorado and Arizona, and we are excited to see how it helps drive earnings into 2019 and beyond."

Third Quarter 2018 Financial Highlights

Net income was $117.3 million and $1.79 per diluted share for the third quarter of 2018, including 18 cents per share from a client asset management fee. Net income was $114.4 million and $1.75 per diluted share for the second quarter of 2018. Net interest revenue totaled $240.9 million, up $2.3 million compared to the second quarter of 2018. Net interest margin increased to 3.21 percent from 3.17 percent. Net interest margin grew 11 basis points excluding recoveries of foregone interest on nonaccruing loans from the previous quarter. Fees and commissions revenue totaled $167.5 million, an increase of $9.7 million or 6 percent compared to the previous quarter, led by an increase in trust fees and commissions. Operating expense increased $6.1 million or 2 percent to $252.6 million. Personnel expense increased $4.6 million and non-personnel expense increased $1.6 million. A $4.0 million provision for credit losses was recorded in the third quarter of 2018.  Net charge-offs were $9.0 million in the third quarter compared to $10.5 million in the previous quarter. Combined allowance for credit losses totaled $213 million or 1.16 percent of outstanding loans compared to $218 million or 1.21 percent of outstanding loans in the previous quarter. Average loans increased $453 million while period-end loans increased $346 million to $18.3 billion. Common equity Tier 1 capital ratio was 12.07 percent, Tier 1 capital ratio was 12.07 percent, total capital ratio was 13.37 percent and leverage ratio was 9.90 percent.

Third Quarter 2018 Business Segment Highlights

Commercial Banking Contributed $85.0 million to net income, down $2.6 million or 3 percent compared to the prior quarter. Net interest revenue remained consistent compared to the second quarter of 2018 at $145 million. Fees and commissions revenue decreased $3.5 million or 8 percent and operating expenses increased $1.7 million or 3 percent. Average loans increased $421 million or 3 percent.    Consumer Banking Contributed $9.2 million to net income, up $3.1 million, primarily due to improved hedge performance related to mortgage servicing rights. Net interest revenue increased $820 thousand or 2 percent. Fees and commissions revenue decreased $2.3 million or 5 percent and operating expenses decreased $2.7 million or 5 percent.    Wealth Management Contributed $29.3 million to net income, up 44 percent compared to the prior quarter. Net interest revenue remained consistent compared to the prior quarter at $29.4 million. Fees and commissions revenue increased $13.1 million or 19 percent due to a fee earned from the sale of client assets in the third quarter of 2018 while operating expenses increased only 1 percent. Average loans grew $26.6 million or 2 percent. Assets under management or administration were $77.6 billion at September 30, 2018 compared to $78.9 billion at June 30, 2018. Fiduciary assets totaled $45.6 billion at September 30, 2018 and $46.5 billion at June 30, 2018.

Net Interest Revenue

Net interest revenue was $240.9 million for the third quarter of 2018, a $2.3 million increase over the second quarter of 2018. Recoveries of foregone interest on nonaccruing loans added $5.3 million to net interest revenue or 7 basis points to net interest margin in the previous quarter. Excluding this impact, net interest margin was 3.21 percent for the third quarter of 2018, up 11 basis points over the second quarter of 2018. The Company reduced excess cash balances held at the Federal Reserve funded by borrowings from the Federal Home Loan Banks. The spread narrowed at the end of the second quarter and was no longer contributing to net interest revenue, which resulted in a 10 basis point improvement to net interest margin in the third quarter of 2018.

Excluding the impact of interest recoveries, the yield on average earning assets was 4.04 percent, a 20 basis point increase, and the yield on the loan portfolio was 4.80 percent up 12 basis points. This increase is due primarily to an increase in short-term market interest rates related to the Federal Reserve's 25 basis point rate increase in June. The yield on the available for sale securities portfolio increased 7 basis points to 2.37 percent. The yield on the trading securities portfolio was up 35 basis points.

Funding costs were 1.25 percent, up 14 basis points. The cost of interest-bearing deposits increased 11 basis points to 0.77 percent. The cost of other borrowed funds was up 20 basis points to 2.04 percent. The benefit to net interest margin from assets funded by non-interest liabilities increased to 42 basis points from 37 basis points in the second quarter of 2018.

Average earning assets decreased $345 million compared to the second quarter of 2018. Average loan balances grew by $453 million. Trading securities balances increased $280 million. Average interest-bearing cash and cash equivalents balances decreased $985 million. Average available for sale securities decreased $34 million. Average interest-bearing deposit balances decreased $221 million compared to the second quarter of 2018. The average balance of borrowed funds decreased $131 million.

Fees and Commissions Revenue

Fees and commissions revenue totaled $167.5 million for the third quarter of 2018, an increase of $9.7 million or 6 percent over the second quarter of 2018. A fee earned in the sale of client assets added $15.4 million to trust fees and commissions in the third quarter.

Rising interest rates have slowed the origination of mortgage loans and related investment products leading to compressed margins. This has adversely affected both our trading revenue as well as our mortgage banking revenue. Brokerage and trading revenue decreased $3.4 million and mortgage banking revenue decreased $2.8 million compared to the second quarter of 2018.

Operating Expense

Total operating expense was $252.6 million for the third quarter of 2018, an increase of $6.1 million or 2 percent compared to the second quarter of 2018.

Personnel expense increased $4.6 million, primarily due to an increase in incentive compensation expense of $6.0 million. Share-based compensation expense was $3.9 million in the third quarter of 2018 and a negative $1.4 million in the previous quarter. Changes in assumptions for the number of performance-based awards that will ultimately vest reduced share-based compensation expense by $4.3 million in the second quarter of 2018. Employee benefits expense decreased $1.5 million compared to the second quarter of 2018, primarily due to a seasonal decrease in payroll taxes.

Non-personnel expense increased $1.6 million. Data processing and communications expense increased $3.9 million, primarily due to impairment of a software license. Net losses and operating expenses of repossessed assets increased $1.3 million as a result of a write down on a healthcare property.

Professional fees and services expense decreased $1.8 million, primarily due to seasonal wealth management tax service fees in the second quarter of 2018. Other expense and mortgage banking costs decreased due to lower loss contingency accruals.

Loans, Deposits and Capital

Loans

Outstanding loans were $18.3 billion at September 30, 2018, up $346 million or 1.9 percent over June 30, 2018, primarily due to continued growth in commercial and commercial real estate loans.

Outstanding commercial loan balances grew by $227 million or 2 percent over June 30, 2018. Energy loan balances were up $148 million, consistent with our ongoing support and commitment to the oil and gas industry. Healthcare sector loans increased by $84 million. The healthcare lending group celebrated their 5 year anniversary as a distinct line of business and continues to be a driver of our core loan growth. Service sector loans increased $73 million. This growth was partially offset by a $49 million decrease in wholesale/retail sector loans and a $41 million decrease in other commercial and industrial loans.

Commercial real estate loan balances continued to grow, up $92 million or 2 percent over June 30, 2018. Multifamily residential loan balances were up $63 million. Loans secured by industrial properties grew by $43 million. Construction and land development loans decreased $17 million.

Deposits

Period-end deposits totaled $21.6 billion at September 30, 2018, a $537 million decrease compared to June 30, 2018. Demand deposit balances decreased $310 million, interest-bearing transaction account balances decreased $174 million and time deposit balances decreased by $52 million.

Capital

The company's common equity Tier 1 capital ratio was 12.07 percent at September 30, 2018. In addition, the company's Tier 1 capital ratio was 12.07 percent, total capital ratio was 13.37 percent, and leverage ratio was 9.90 percent at September 30, 2018. At June 30, 2018, the company's common equity Tier 1 capital ratio was 11.92 percent, Tier 1 capital ratio was 11.92 percent, total capital ratio was 13.26 percent, and leverage ratio was 9.57 percent.

The company's tangible common equity ratio, a non-GAAP measure, was 9.55 percent at September 30, 2018 and 9.21 percent at June 30, 2018. The tangible common equity ratio is primarily based on total shareholders' equity, which includes unrealized gains and losses on available for sale securities. The company has elected to exclude unrealized gains and losses from available for sale securities from its calculation of Tier 1 capital for regulatory capital purposes, consistent with the treatment under the previous capital rules.

Credit Quality

Nonperforming assets totaled $261 million or 1.42 percent of outstanding loans and repossessed assets at September 30, 2018, compared to $269 million or 1.49 percent at June 30, 2018. Nonperforming assets that are not guaranteed by U.S. government agencies totaled $170 million or 0.93 percent of outstanding loans and repossessed assets (excluding those guaranteed by U.S. government agencies) at September 30, 2018, down from $186 million or 1.04 percent at June 30, 2018.

Nonaccruing loans were $153 million or 0.83 percent of outstanding loans at September 30, 2018, compared to $166 million or 0.92 percent of outstanding loans at June 30, 2018. The decrease in nonaccruing loans was primarily due to a $12 million decrease in energy loans and a $4.8 million decrease in wholesale/retail sector loans, partially offset by a $6.2 million increase in manufacturing sector loans. New nonaccruing loans identified in the third quarter totaled $20 million, offset by $20 million in payments received, $11 million in charge-offs, and $1.6 million in foreclosures and repossessions. At September 30, 2018, nonaccruing commercial loans totaled $109 million or 0.95 percent of outstanding commercial loans, nonaccruing commercial real estate loans totaled $1.3 million or 0.03 percent of outstanding commercial real estate loans, and nonaccruing residential mortgage loans totaled $42 million or 2.13 percent of outstanding residential mortgage loans.

Potential problem loans, which are defined as performing loans that, based on known information, cause management concern as to the borrowers' ability to continue to perform, totaled $176 million at September 30, compared to $140 million at June 30. The increase largely resulted from commercial real estate loans secured by retail facilities, energy sector and services sector loans.

The company had net charge-offs of $9.0 million or 0.20 percent of average loans on an annualized basis for third quarter of 2018, compared to net charge-offs of $10.5 million or 0.24 percent of average loans on an annualized basis for the second quarter of 2018. Net charge-offs were 0.18 percent of average loans over the last four quarters. Net charge-offs for the third quarter were primarily related to a single energy production borrower and single wholesale/retail sector borrower, both of which had previously been identified as impaired and appropriately reserved. Gross charge-offs were $11.1 million for the third quarter compared to $15.1 million for the previous quarter. Recoveries totaled $2.1 million for the third quarter of 2018 and $4.6 million for the second quarter of 2018.

Based on an evaluation of all credit factors, including overall loan portfolio growth, changes in nonaccruing and potential problem loans and net charge-offs, the company determined that a $4.0 million provision for credit losses was appropriate for the third quarter of 2018. The company recorded no provision for credit losses in the second quarter of 2018.

The combined allowance for credit losses totaled $213 million or 1.16 percent of outstanding loans and 146 percent of nonaccruing loans at September 30, 2018, excluding residential mortgage loans guaranteed by U.S. government agencies. The allowance for loan losses was $211 million and the accrual for off-balance sheet credit losses was $2.0 million. At June 30, 2018, the combined allowance for credit losses was $218 million or 1.21 percent of outstanding loans and 138 percent of nonaccruing loans, excluding loans guaranteed by U.S. government agencies. The allowance for loan losses was $215 million and the accrual for off-balance sheet credit losses was $2.4 million.

Commercial Banking

Net income for Commercial Banking was $85.0 million for the third quarter of 2018, a decrease of $2.6 million compared to the second quarter of 2018. Second quarter earnings included $5.3 million in interest recoveries on nonaccrual loans. Excluding the impact of interest recoveries, growth in net interest revenue was driven by strong growth in loan balances and improved loan yields. This growth was partially offset by a modest increase in our internal cost of funds allocation.

Average loan balances increased $421 million or 3 percent, largely impacted by energy, commercial real estate, service and other commercial and industrial loans. Average customer deposits were $8.6 billion, an increase of $254 million or 3 percent, mostly due to energy, real estate, and general commercial and industrial deposits.

Fees and commissions revenue decreased $3.5 million or 8 percent as a result of reduced customer hedging revenue and the timing of closing loan syndication transactions after an exceptionally strong second quarter. Expense growth outpaced revenue growth primarily due to an increase in incentive compensation as a result of continued loan growth as well as a $1.7 million write down of a repossessed property in the third quarter.

Consumer Banking

Net income from Consumer Banking was $9.2 million in the third quarter of 2018, an increase of $3.1 million or 50 percent. The net economic cost of the changes in fair value of mortgage servicing rights and related economic hedges was $156 thousand for the third quarter of 2018 compared to $3.5 million for the second quarter of 2018.

Revenues from mortgage banking activities decreased $2.8 million from the prior quarter. Continued rising interest rates and increased market competition slowed origination activity, which declined 16 percent compared to the prior quarter. Efforts to right size current capacity have resulted in personnel expense savings of $1.7 million from the previous quarter.

Net interest revenue from Consumer Banking activities increased $820 thousand while deposit service charges and fees increased $588 thousand over the second quarter of 2018. The introduction of a new time deposit product as well as interest rate increases on existing money market products have positively impacted runoff trends.

Average consumer loans and deposits remained relatively consistent compared to the prior quarter at $1.7 billion and $6.6 billion, respectively.

Wealth Management

Net income for Wealth Management increased $9.0 million to $29.3 million during the third quarter of 2018. This increase included an after tax benefit of $11.5 million as a result of a fee earned on the sale of client assets. Excluding this fee, fiduciary and asset management fees produced relatively consistent results compared to the second quarter of 2018.

Average loans increased $27 million or 2 percent to $1.4 billion. Average deposits decreased $343 million or 6 percent, primarily due to client migrations to investments. Assets under management decreased $1.2 billion or 1.6 percent to $77.6 billion at September 30, 2018.

Brokerage and trading revenue decreased $1.7 million or 8 percent compared to the second quarter of 2018 due to a decreased demand in investment products related to rising interest rates and slowing mortgage production.

Conference Call and Webcast

The company will hold a conference call at 9 a.m. Central time on Wednesday, October 24, 2018 to discuss the financial results with investors. The live audio webcast and presentation slides will be available on the company’s website at www.bokf.com. The conference call can also be accessed by dialing 1-201-689-8471. A conference call and webcast replay will also be available shortly after conclusion of the live call at www.bokf.com or by dialing 1-412-317-6671 and referencing conference ID # 13683709.

About BOK Financial Corporation

BOK Financial Corporation is a $33 billion regional financial services company based in Tulsa, Oklahoma. The company's stock is publicly traded on NASDAQ under the Global Select market listings (symbol: BOKF). BOK Financial's holdings include BOKF, NA, BOK Financial Securities, Inc. and The Milestone Group, Inc. BOKF, NA operates TransFund, Cavanal Hill Investment Management, BOK Financial Asset Management, Inc. and seven banking divisions: Bank of Albuquerque, Bank of Arizona, Bank of Arkansas, Mobank, Bank of Oklahoma, Bank of Texas and Colorado State Bank and Trust. Through its subsidiaries, the company provides commercial and consumer banking, investment and trust services, mortgage origination and servicing, and an electronic funds transfer network. For more information, visit www.bokf.com.

The company will continue to evaluate critical assumptions and estimates, such as the appropriateness of the allowance for credit losses and asset impairment as of September 30, 2018 through the date its financial statements are filed with the Securities and Exchange Commission and will adjust amounts reported if necessary.

This news release contains forward-looking statements that are based on management's beliefs, assumptions, current expectations, estimates and projections about BOK Financial, the financial services industry and the economy generally. Words such as “anticipates,” “believes,” “estimates,” “expects,” “forecasts,” “plans,” “projects,” “will,”  “intends,” variations of such words and similar expressions are intended to identify such forward-looking statements. Management judgments relating to and discussion of the provision and allowance for credit losses, allowance for uncertain tax positions, accruals for loss contingencies and valuation of mortgage servicing rights involve judgments as to expected events and are inherently forward-looking statements. Assessments that BOK Financial's acquisitions, including its latest acquisition of CoBiz Financial, Inc., and other growth endeavors will be profitable are necessary statements of belief as to the outcome of future events based in part on information provided by others which BOK Financial has not independently verified. These statements are not guarantees of future performance and involve certain risks, uncertainties, and assumptions which are difficult to predict with regard to timing, extent, likelihood and degree of occurrence. Therefore, actual results and outcomes may materially differ from what is expected, implied or forecasted in such forward-looking statements. Internal and external factors that might cause such a difference include, but are not limited to changes in commodity prices, interest rates and interest rate relationships, inflation, demand for products and services, the degree of competition by traditional and nontraditional competitors, changes in banking regulations, tax laws, prices, levies and assessments, the impact of technological advances, and trends in customer behavior as well as their ability to repay loans. There may also be difficulties and delays in integrating CoBiz Financial Inc.'s business or fully realizing cost savings and other benefits including, but not limited to, business disruption and customer acceptance of BOK Financial Corporation's products and services. BOK Financial and its affiliates undertake no obligation to update, amend or clarify forward-looking statements, whether as a result of new information, future events, or otherwise.

BALANCE SHEETS -- UNAUDITED BOK FINANCIAL CORPORATION (In thousands)
	Sept. 30, 2018				June 30, 2018				Sept. 30, 2017
ASSETS
Cash and due from banks	$	815,458			$	585,801			$	547,203
Interest-bearing cash and cash equivalents	430,789				872,999				1,926,779
Trading securities	1,613,400				1,909,615				614,117
Investment securities	374,039				392,013				466,562
Available for sale debt securities	8,072,014				8,162,866				8,383,199
Fair value option securities	452,150				482,227				819,531
Restricted equity securities	311,189				347,721				347,542
Residential mortgage loans held for sale	175,866				223,301				275,643
Loans:
Commercial	11,576,101				11,349,039				10,795,934
Commercial real estate	3,804,675				3,712,220				3,518,142
Residential mortgage	1,971,742				1,942,250				1,945,750
Personal	996,941				1,000,187				947,008
Total loans	18,349,459				18,003,696				17,206,834
Allowance for loan losses	(210,569		)		(215,142		)		(247,703		)
Loans, net of allowance	18,138,890				17,788,554				16,959,131
Premises and equipment, net	327,129				320,810				320,060
Receivables	277,738				212,893				173,990
Goodwill	447,430				453,093				446,697
Intangible assets, net	33,370				28,273				39,013
Mortgage servicing rights	284,673				278,719				245,858
Real estate and other repossessed assets, net	24,515				27,891				32,535
Derivative contracts, net	349,481				373,373				352,559
Cash surrender value of bank-owned life insurance	323,628				321,024				314,201
Receivable on unsettled securities sales	421,313				604,552				370,486
Other assets	416,792				447,382				370,409
TOTAL ASSETS	$	33,289,864			$	33,833,107			$	33,005,515
LIABILITIES AND EQUITY
Deposits:
Demand	$	9,063,623			$	9,373,959			$	9,185,481
Interest-bearing transaction	9,990,219				10,164,099				10,025,084
Savings	502,601				503,474				465,225
Time	2,075,846				2,127,732				2,172,289
Total deposits	21,632,289				22,169,264				21,848,079
Funds purchased and repurchase agreements	790,741				880,027				390,545
Other borrowings	6,025,483				5,929,445				6,241,275
Subordinated debentures	144,707				144,697				144,668
Accrued interest, taxes and expense	231,592				160,568				152,029
Due on unsettled securities purchases	414,283				571,034				176,498
Derivative contracts, net	252,387				234,856				336,327
Other liabilities	172,622				167,171				201,655
TOTAL LIABILITIES	29,664,104				30,257,062				29,491,076
Shareholders' equity:
Capital, surplus and retained earnings	3,777,394				3,688,736				3,482,057
Accumulated other comprehensive gain (loss)	(162,362		)		(135,305		)		6,757
TOTAL SHAREHOLDERS' EQUITY	3,615,032				3,553,431				3,488,814
Non-controlling interests	10,728				22,614				25,625
TOTAL EQUITY	3,625,760				3,576,045				3,514,439
TOTAL LIABILITIES AND EQUITY	$	33,289,864			$	33,833,107			$	33,005,515

AVERAGE BALANCE SHEETS -- UNAUDITED BOK FINANCIAL CORPORATION (in thousands)
	Three Months Ended
	Sept. 30, 2018				June 30, 2018				Mar. 31, 2018				Dec. 31, 2017				Sept. 30, 2017
ASSETS
Interest-bearing cash and cash equivalents	$	688,872			$	1,673,387			$	2,059,517			$	1,976,395			$	1,965,645
Trading securities	1,762,794				1,482,302				933,404				560,321				491,613
Investment securities	379,566				399,088				441,207				462,869				475,705
Available for sale debt securities	8,129,214				8,163,142				8,236,938				8,435,916				8,428,353
Fair value option securities	469,398				487,192				626,251				792,647				684,571
Restricted equity securities	328,842				348,546				349,176				337,673				328,677
Residential mortgage loans held for sale	207,488				218,600				199,380				257,927				256,343
Loans:
Commercial	11,484,200				11,189,899				10,871,569				10,751,235				10,827,198
Commercial real estate	3,774,470				3,660,166				3,491,335				3,485,583				3,528,330
Residential mortgage	1,956,089				1,915,015				1,937,198				1,976,860				1,951,385
Personal	989,026				986,162				961,379				967,329				949,750
Total loans	18,203,785				17,751,242				17,261,481				17,181,007				17,256,663
Allowance for loan losses	(214,160		)		(222,856		)		(228,996		)		(246,143		)		(250,590		)
Total loans, net	17,989,625				17,528,386				17,032,485				16,934,864				17,006,073
Total earning assets	29,955,799				30,300,643				29,878,358				29,758,612				29,636,980
Cash and due from banks	578,905				571,333				564,585				576,737				546,653
Derivative contracts, net	294,126				318,375				278,694				292,961				238,583
Cash surrender value of bank-owned life insurance	322,038				319,507				317,334				315,034				313,079
Receivable on unsettled securities sales	768,785				618,240				998,803				821,275				608,412
Other assets	1,776,164				1,777,937				1,687,178				1,687,496				1,664,463
TOTAL ASSETS	$	33,695,817			$	33,906,035			$	33,724,952			$	33,452,115			$	33,008,170
LIABILITIES AND EQUITY
Deposits:
Demand	$	9,325,002			$	9,223,327			$	9,151,272			$	9,417,351			$	9,389,849
Interest-bearing transaction	10,010,031				10,189,354				10,344,469				10,142,744				10,088,522
Savings	503,821				503,671				480,110				466,496				464,130
Time	2,097,441				2,138,880				2,151,044				2,134,469				2,176,820
Total deposits	21,936,295				22,055,232				22,126,895				22,161,060				22,119,321
Funds purchased and repurchase agreements	1,193,583				593,250				532,412				488,330				411,286
Other borrowings	5,765,440				6,497,020				6,326,967				6,209,903				6,162,641
Subordinated debentures	144,702				144,692				144,682				144,673				144,663
Derivative contracts, net	185,029				235,543				223,373				288,408				221,371
Due on unsettled securities purchases	544,263				527,804				558,898				332,155				145,977
Other liabilities	311,605				340,322				333,151				312,196				318,270
TOTAL LIABILITIES	30,080,917				30,393,863				30,246,378				29,936,725				29,523,529
Total equity	3,614,900				3,512,172				3,478,574				3,515,390				3,484,641
TOTAL LIABILITIES AND EQUITY	$	33,695,817			$	33,906,035			$	33,724,952			$	33,452,115			$	33,008,170

STATEMENTS OF EARNINGS -- UNAUDITED BOK FINANCIAL CORPORATION (in thousands, except per share data)
	Three Months Ended								Nine Months Ended
	September 30,								September 30,
	2018				2017				2018				2017
Interest revenue	$	303,247			$	255,413			$	862,834			$	716,984
Interest expense	62,364				36,961				163,653				92,146
Net interest revenue	240,883				218,452				699,181				624,838
Provision for credit losses	4,000				—				(1,000		)		—
Net interest revenue after provision for credit losses	236,883				218,452				700,181				624,838
Other operating revenue:
Brokerage and trading revenue	23,086				33,169				80,222				98,556
Transaction card revenue1	21,396				22,929				63,361				61,115
Fiduciary and asset management revenue	57,514				40,687				141,045				121,126
Deposit service charges and fees	27,765				28,191				82,753				84,390
Mortgage banking revenue	23,536				24,890				75,907				80,357
Other revenue	14,213				13,670				41,061				40,406
Total fees and commissions	167,510				163,536				484,349				485,950
Other gains (losses), net	1,441				(1,283		)		4,760				8,452
Gain (loss) on derivatives, net	(2,847		)		1,033				(11,589		)		3,824
Gain (loss) on fair value option securities, net	(4,385		)		661				(25,290		)		1,505
Change in fair value of mortgage servicing rights	5,972				(639		)		28,901				(5,726		)
Gain (loss) on available for sale securities, net	250				2,487				(802		)		4,916
Total other operating revenue	167,941				165,795				480,329				498,921
Other operating expense:
Personnel	143,531				147,910				422,425				428,079
Business promotion	7,620				7,105				21,316				21,560
Professional fees and services	13,209				11,887				38,387				35,723
Net occupancy and equipment	23,394				21,325				70,201				64,074
Insurance	6,232				6,005				19,070				13,098
Data processing and communications1	31,665				27,412				87,221				79,222
Printing, postage and supplies	3,837				3,917				11,937				11,908
Net losses and operating expenses of repossessed assets	4,044				6,071				14,471				9,347
Amortization of intangible assets	1,603				1,744				4,289				5,349
Mortgage banking costs	11,741				13,450				34,780				38,525
Other expense	5,741				9,193				19,426				25,308
Total other operating expense	252,617				256,019				743,523				732,193
Net income before taxes	152,207				128,228				436,987				391,566
Federal and state income taxes	34,662				42,438				98,940				128,246
Net income	117,545				85,790				338,047				263,320
Net income attributable to non-controlling interests	289				141				857				1,168
Net income attributable to BOK Financial Corporation shareholders	$	117,256			$	85,649			$	337,190			$	262,152
Average shares outstanding:
Basic	64,901,095				64,742,822				64,883,319				64,729,391
Diluted	64,934,351				64,805,172				64,919,728				64,793,893
Net income per share:
Basic	$	1.79			$	1.31			$	5.15			$	4.01
Diluted	$	1.79			$	1.31			$	5.15			$	4.00

¹    Non-GAAP measure to net interchange charges for periods prior to 2018 between transaction card revenue and data processing and communications expense. This measure has no effect on net income or earnings per share.

FINANCIAL HIGHLIGHTS -- UNAUDITED BOK FINANCIAL CORPORATION (in thousands, except ratio and share data)
	Three Months Ended
	Sept. 30, 2018				June 30, 2018				Mar. 31, 2018				Dec. 31, 2017				Sept. 30, 2017
Capital:
Period-end shareholders' equity	$	3,615,032			$	3,553,431			$	3,495,029			$	3,495,367			$	3,488,814
Risk weighted assets	$	27,398,072			$	27,004,559			$	26,025,660			$	25,733,711			$	25,409,728
Risk-based capital ratios:
Common equity tier 1	12.07		%		11.92		%		12.06		%		12.05		%		11.90		%
Tier 1	12.07		%		11.92		%		12.06		%		12.05		%		11.90		%
Total capital	13.37		%		13.26		%		13.49		%		13.54		%		13.47		%
Leverage ratio	9.90		%		9.57		%		9.40		%		9.31		%		9.30		%
Tangible common equity ratio1	9.55		%		9.21		%		9.18		%		9.50		%		9.23		%
Common stock:
Book value per share	$	55.25			$	54.30			$	53.39			$	53.45			$	53.30
Tangible book value per share	47.90				46.95				46.10				46.17				45.88
Market value per share:
High	$	105.22			$	106.65			$	107.00			$	93.97			$	90.69
Low	$	92.40			$	92.39			$	89.82			$	79.67			$	77.10
Cash dividends paid	$	32,591			$	29,340			$	29,342			$	29,328			$	28,655
Dividend payout ratio	27.79		%		25.65		%		27.80		%		40.46		%		33.46		%
Shares outstanding, net	65,434,258				65,439,090				65,459,505				65,394,937				65,456,786
Stock buy-back program:
Shares repurchased	—				8,257				82,583				80,000				—
Amount	$	—			$	824			$	7,584			$	7,403			$	—
Average price per share	$	—			$	99.84			$	91.83			$	92.54			$	—
Performance ratios (quarter annualized):
Return on average assets	1.38		%		1.35		%		1.27		%		0.86		%		1.03		%
Return on average equity	12.95		%		13.14		%		12.39		%		8.24		%		9.83		%
Net interest margin	3.21		%		3.17		%		2.99		%		2.97		%		3.01		%
Efficiency ratio3	61.41		%		61.68		%		65.09		%		66.07		%		65.92		%
Reconciliation of non-GAAP measures:
1  Tangible common equity ratio:
Total shareholders' equity	$	3,615,032			$	3,553,431			$	3,495,029			$	3,495,367			$	3,488,814
Less: Goodwill and intangible assets, net	480,800				481,366				477,088				476,088				485,710
Tangible common equity	$	3,134,232			$	3,072,065			$	3,017,941			$	3,019,279			$	3,003,104
Total assets	$	33,289,864			$	33,833,107			$	33,361,492			$	32,272,160			$	33,005,515
Less: Goodwill and intangible assets, net	480,800				481,366				477,088				476,088				485,710
Tangible assets	$	32,809,064			$	33,351,741			$	32,884,404			$	31,796,072			$	32,519,805
Tangible common equity ratio	9.55		%		9.21		%		9.18		%		9.50		%		9.23		%
Other data:
Fiduciary assets	$	45,560,107			$	46,531,900			$	46,648,290			$	48,761,477			$	45,177,185
Tax equivalent interest	$	1,894			$	1,983			$	2,010			$	4,131			$	4,314
Net unrealized gain (loss) on available for sale securities	$	(216,793	)		$	(180,602	)		$	(148,247	)		$	(47,497	)		$	14,061
Mortgage banking:
Mortgage production revenue	$	7,250			$	9,915			$	9,452			$	7,786			$	8,329
Mortgage loans funded for sale	$	651,076			$	773,910			$	664,958			$	840,080			$	832,796
Add: current period-end outstanding commitments	197,752				251,231				298,318				222,919				334,337
Less: prior period end outstanding commitments	251,231				298,318				222,919				334,337				362,088
Total mortgage production volume	$	597,597			$	726,823			$	740,357			$	728,662			$	805,045
Mortgage loan refinances to mortgage loans funded for sale	23		%		22		%		42		%		47		%		38		%
Gain on sale margin	1.21		%		1.36		%		1.28		%		1.07		%		1.03		%
Mortgage servicing revenue	$	16,286			$	16,431			$	16,573			$	16,576			$	16,561
Average outstanding principal balance of mortgage loans serviced for others	21,895,041				21,986,065				22,027,726				22,054,877				22,079,177
Average mortgage servicing revenue rates	0.30		%		0.30		%		0.31		%		0.30		%		0.30		%
Gain (loss) on mortgage servicing rights, net of economic hedge:
Gain (loss) on mortgage hedge derivative contracts, net	$	(2,843	)		$	(3,070	)		$	(5,698	)		$	(3,057	)		$	1,025
Gain (loss) on fair value option securities, net	(4,385		)		(3,341		)		(17,564		)		(4,238		)		661
Gain (loss) on economic hedge of mortgage servicing rights	(7,228		)		(6,411		)		(23,262		)		(7,295		)		1,686
Gain (loss) on changes in fair value of mortgage servicing rights	5,972				1,723				21,206				5,898				(639		)
Gain (loss) on changes in fair value of mortgage servicing rights, net of economic hedges, included in other operating revenue	(1,256		)		(4,688		)		(2,056		)		(1,397		)		1,047
Net interest revenue on fair value option securities2	1,100				1,203				1,800				2,656				2,543
Total economic benefit (cost) of changes in the fair value of mortgage servicing rights, net of economic hedges	$	(156	)		$	(3,485	)		$	(256	)		$	1,259			$	3,590

²    Actual interest earned on fair value option securities less internal transfer-priced cost of funds.
³    Periods prior to 2018 are shown on a comparable basis to net interchange charges between transaction card revenue and data processing and communications expense.

QUARTERLY EARNINGS TREND -- UNAUDITED BOK FINANCIAL CORPORATION (in thousands, except ratio and per share data)
	Three Months Ended
	Sept. 30, 2018				June 30, 2018				Mar. 31, 2018				Dec. 31, 2017				Sept. 30, 2017
Interest revenue	$	303,247			$	294,180			$	265,407			$	255,767			$	255,413
Interest expense	62,364				55,618				45,671				38,904				36,961
Net interest revenue	240,883				238,562				219,736				216,863				218,452
Provision for credit losses	4,000				—				(5,000		)		(7,000		)		—
Net interest revenue after provision for credit losses	236,883				238,562				224,736				223,863				218,452
Other operating revenue:
Brokerage and trading revenue	23,086				26,488				30,648				33,045				33,169
Transaction card revenue1	21,396				20,975				20,990				20,028				22,929
Fiduciary and asset management revenue	57,514				41,699				41,832				41,767				40,687
Deposit service charges and fees	27,765				27,827				27,161				27,685				28,191
Mortgage banking revenue	23,536				26,346				26,025				24,362				24,890
Other revenue	14,213				14,518				12,330				11,762				13,670
Total fees and commissions	167,510				157,853				158,986				158,649				163,536
Other gains (losses), net	1,441				3,983				(664		)		552				(1,283		)
Gain (loss) on derivatives, net	(2,847		)		(3,057		)		(5,685		)		(3,045		)		1,033
Gain (loss) on fair value option securities, net	(4,385		)		(3,341		)		(17,564		)		(4,238		)		661
Change in fair value of mortgage servicing rights	5,972				1,723				21,206				5,898				(639		)
Gain (loss) on available for sale securities, net	250				(762		)		(290		)		(488		)		2,487
Total other operating revenue	167,941				156,399				155,989				157,328				165,795
Other operating expense:
Personnel	143,531				138,947				139,947				145,329				147,910
Business promotion	7,620				7,686				6,010				7,317				7,105
Charitable contributions to BOKF Foundation	—				—				—				2,000				—
Professional fees and services	13,209				14,978				10,200				15,344				11,887
Net occupancy and equipment	23,394				22,761				24,046				22,403				21,325
Insurance	6,232				6,245				6,593				6,555				6,005
Data processing and communications1	31,665				27,739				27,817				28,903				27,412
Printing, postage and supplies	3,837				4,011				4,089				3,781				3,917
Net losses (gains) and operating expenses of repossessed assets	4,044				2,722				7,705				340				6,071
Amortization of intangible assets	1,603				1,386				1,300				1,430				1,744
Mortgage banking costs	11,741				12,890				10,149				14,331				13,450
Other expense	5,741				7,111				6,574				6,746				9,193
Total other operating expense	252,617				246,476				244,430				254,479				256,019
Net income before taxes	152,207				148,485				136,295				126,712				128,228
Federal and state income taxes	34,662				33,330				30,948				54,347				42,438
Net income	117,545				115,155				105,347				72,365				85,790
Net income (loss) attributable to non-controlling interests	289				783				(215		)		(127		)		141
Net income attributable to BOK Financial Corporation shareholders	$	117,256			$	114,372			$	105,562			$	72,492			$	85,649
Average shares outstanding:
Basic	64,901,095				64,901,975				64,847,334				64,793,005				64,742,822
Diluted	64,934,351				64,937,226				64,888,033				64,843,179				64,805,172
Net income per share:
Basic	$	1.79			$	1.75			$	1.61			$	1.11			$	1.31
Diluted	$	1.79			$	1.75			$	1.61			$	1.11			$	1.31

¹    Non-GAAP measure to net interchange charges for periods prior to 2018 between transaction card revenue and data processing and communications expense. This measure has no effect on net income or earnings per share.

LOANS TREND -- UNAUDITED BOK FINANCIAL CORPORATION (In thousands)
		Sept. 30, 2018				June 30, 2018				Mar. 31, 2018				Dec. 31, 2017				Sept. 30, 2017
Commercial:
Energy		$	3,294,867			$	3,147,219			$	2,969,618			$	2,930,156			$	2,867,981
Services		3,017,311				2,944,499				2,928,294				2,986,949				2,967,513
Healthcare		2,437,323				2,353,722				2,359,928				2,314,753				2,239,451
Wholesale/retail		1,650,729				1,699,554				1,531,576				1,471,256				1,658,098
Manufacturing		660,582				647,816				559,695				496,774				519,446
Other commercial and industrial		515,289				556,229				570,556				534,087				543,445
Total commercial		11,576,101				11,349,039				10,919,667				10,733,975				10,795,934
Commercial real estate:
Multifamily		1,120,166				1,056,984				1,008,903				980,017				999,009
Office		824,829				820,127				737,144				831,770				797,089
Retail		759,423				768,024				750,396				691,532				725,865
Industrial		696,774				653,384				613,608				573,014				591,080
Residential construction and land development		101,872				118,999				117,458				117,245				112,102
Other commercial real estate		301,611				294,702				279,273				286,409				292,997
Total commercial real estate		3,804,675				3,712,220				3,506,782				3,479,987				3,518,142
Residential mortgage:
Permanent mortgage		1,094,926				1,068,412				1,047,785				1,043,435				1,013,965
Permanent mortgages guaranteed by U.S. government agencies		180,718				169,653				177,880				197,506				187,370
Home equity		696,098				704,185				720,104				732,745				744,415
Total residential mortgage		1,971,742				1,942,250				1,945,769				1,973,686				1,945,750
Personal		996,941				1,000,187				965,632				965,776				947,008
Total		$	18,349,459			$	18,003,696			$	17,337,850			$	17,153,424			$	17,206,834

LOANS BY PRINCIPAL MARKET AREA -- UNAUDITED BOK FINANCIAL CORPORATION (in thousands)
	Sept. 30, 2018				June 30, 2018				Mar. 31, 2018				Dec. 31, 2017				Sept. 30, 2017
Oklahoma:
Commercial	$	3,609,109			$	3,465,407			$	3,265,013			$	3,238,720			$	3,408,973
Commercial real estate	651,315				662,665				668,031				682,037				712,915
Residential mortgage	1,429,843				1,403,658				1,419,281				1,435,432				1,405,900
Personal	376,201				362,846				353,128				342,212				322,320
Total Oklahoma	6,066,468				5,894,576				5,705,453				5,698,401				5,850,108
Texas:
Commercial	5,115,646				4,922,451				4,715,841				4,520,401				4,434,595
Commercial real estate	1,354,679				1,336,101				1,254,421				1,261,864				1,236,702
Residential mortgage	253,265				243,400				229,761				233,675				229,993
Personal	381,452				394,021				363,608				375,084				375,173
Total Texas	7,105,042				6,895,973				6,563,631				6,391,024				6,276,463
New Mexico:
Commercial	325,048				305,167				315,701				343,296				367,747
Commercial real estate	392,494				386,878				348,485				341,282				319,208
Residential mortgage	88,110				90,581				93,490				98,018				101,983
Personal	11,659				11,107				11,667				11,721				12,953
Total New Mexico	817,311				793,733				769,343				794,317				801,891
Arkansas:
Commercial	102,237				93,217				94,430				95,644				91,051
Commercial real estate	106,701				90,807				88,700				87,393				80,917
Residential mortgage	7,278				6,927				7,033				6,596				6,318
Personal	12,126				12,331				9,916				9,992				10,388
Total Arkansas	228,342				203,282				200,079				199,625				188,674
Colorado:
Commercial	1,132,500				1,165,721				1,180,655				1,130,714				1,124,200
Commercial real estate	354,543				267,065				210,801				174,201				186,427
Residential mortgage	68,694				64,839				64,530				63,350				63,734
Personal	56,999				60,504				63,118				63,115				60,513
Total Colorado	1,612,736				1,558,129				1,519,104				1,431,380				1,434,874
Arizona:
Commercial	621,658				681,852				624,106				687,792				634,809
Commercial real estate	666,562				710,784				672,319				660,094				706,188
Residential mortgage	44,659				47,010				39,227				41,771				40,730
Personal	67,280				65,541				57,023				57,140				55,050
Total Arizona	1,400,159				1,505,187				1,392,675				1,446,797				1,436,777
Kansas/Missouri:
Commercial	669,903				715,224				723,921				717,408				734,559
Commercial real estate	278,381				257,920				264,025				273,116				275,785
Residential mortgage	79,893				85,835				92,447				94,844				97,092
Personal	91,224				93,837				107,172				106,512				110,611
Total Kansas/Missouri	1,119,401				1,152,816				1,187,565				1,191,880				1,218,047
TOTAL BOK FINANCIAL	$	18,349,459			$	18,003,696			$	17,337,850			$	17,153,424			$	17,206,834

Loans attributed to a geographical region may not always represent the location of the borrower or the collateral.

DEPOSITS BY PRINCIPAL MARKET AREA -- UNAUDITED BOK FINANCIAL CORPORATION (in thousands)
	Sept. 30, 2018				June 30, 2018				Mar. 31, 2018				Dec. 31, 2017				Sept. 30, 2017
Oklahoma:
Demand	$	3,564,307			$	3,867,933			$	4,201,842			$	3,885,008			$	4,061,612
Interest-bearing:
Transaction	6,010,972				5,968,460				6,051,302				5,901,293				5,909,259
Savings	288,080				289,202				289,351				265,870				265,023
Time	1,128,810				1,207,471				1,203,534				1,092,133				1,131,547
Total interest-bearing	7,427,862				7,465,133				7,544,187				7,259,296				7,305,829
Total Oklahoma	10,992,169				11,333,066				11,746,029				11,144,304				11,367,441
Texas:
Demand	3,353,248				3,317,656				3,015,869				3,239,098				3,094,184
Interest-bearing:
Transaction	2,181,382				2,168,488				2,208,480				2,397,071				2,272,987
Savings	97,909				97,809				98,852				93,620				93,400
Time	453,119				445,500				475,967				502,879				521,072
Total interest-bearing	2,732,410				2,711,797				2,783,299				2,993,570				2,887,459
Total Texas	6,085,658				6,029,453				5,799,168				6,232,668				5,981,643
New Mexico:
Demand	722,188				770,974				695,060				663,353				659,793
Interest-bearing:
Transaction	593,760				586,593				555,414				552,393				551,884
Savings	57,794				59,415				60,596				55,647				53,532
Time	221,513				212,689				216,306				216,743				224,773
Total interest-bearing	873,067				858,697				832,316				824,783				830,189
Total New Mexico	1,595,255				1,629,671				1,527,376				1,488,136				1,489,982
Arkansas:
Demand	36,579				39,896				35,291				30,384				31,442
Interest-bearing:
Transaction	128,001				143,298				94,206				85,095				126,746
Savings	1,826				1,885				1,960				1,881				1,876
Time	10,214				10,771				11,878				14,045				14,434
Total interest-bearing	140,041				155,954				108,044				101,021				143,056
Total Arkansas	176,620				195,850				143,335				131,405				174,498
Colorado:
Demand	593,442				529,912				521,963				633,714				540,300
Interest-bearing:
Transaction	622,520				701,362				687,785				657,629				628,807
Savings	40,308				38,176				37,232				35,223				34,776
Time	217,628				208,049				215,330				224,962				231,927
Total interest-bearing	880,456				947,587				940,347				917,814				895,510
Total Colorado	1,473,898				1,477,499				1,462,310				1,551,528				1,435,810
Arizona:
Demand	370,299				387,952				330,196				334,701				335,740
Interest-bearing:
Transaction	130,837				194,353				248,337				274,846				174,010
Savings	3,559				3,935				4,116				3,343				4,105
Time	23,927				22,447				21,009				20,394				20,831
Total interest-bearing	158,323				220,735				273,462				298,583				198,946
Total Arizona	528,622				608,687				603,658				633,284				534,686
Kansas/Missouri:
Demand	423,560				459,636				505,802				457,080				462,410
Interest-bearing:
Transaction	322,747				401,545				381,447				382,066				361,391
Savings	13,125				13,052				13,845				13,574				12,513
Time	20,635				20,805				22,230				27,260				27,705
Total interest-bearing	356,507				435,402				417,522				422,900				401,609
Total Kansas/Missouri	780,067				895,038				923,324				879,980				864,019
TOTAL BOK FINANCIAL	$	21,632,289			$	22,169,264			$	22,205,200			$	22,061,305			$	21,848,079

NET INTEREST MARGIN TREND -- UNAUDITED BOK FINANCIAL CORPORATION
	Three Months Ended
	Sept. 30, 2018			June 30, 2018			Mar. 31, 2018			Dec. 30, 2017			Sept. 30, 2017
TAX-EQUIVALENT ASSETS YIELDS
Interest-bearing cash and cash equivalents	1.98	%		1.86	%		1.57	%		1.27	%		1.29	%
Trading securities	3.98	%		3.63	%		3.40	%		3.38	%		3.47	%
Investment securities	4.06	%		3.95	%		3.78	%		3.98	%		3.86	%
Available for sale securities	2.37	%		2.30	%		2.23	%		2.21	%		2.17	%
Fair value option securities	3.25	%		3.16	%		2.95	%		2.90	%		2.97	%
Restricted equity securities	6.36	%		6.21	%		5.86	%		5.87	%		5.87	%
Residential mortgage loans held for sale	4.27	%		4.28	%		3.71	%		3.72	%		3.36	%
Loans	4.80	%		4.80	%		4.45	%		4.29	%		4.31	%
Allowance for loan losses
Loans, net of allowance	4.86	%		4.86	%		4.51	%		4.35	%		4.38	%
Total tax-equivalent yield on earning assets	4.04	%		3.91	%		3.61	%		3.49	%		3.50	%
COST OF INTEREST-BEARING LIABILITIES
Interest-bearing deposits:
Interest-bearing transaction	0.67	%		0.55	%		0.45	%		0.35	%		0.32	%
Savings	0.09	%		0.08	%		0.07	%		0.07	%		0.08	%
Time	1.40	%		1.29	%		1.25	%		1.17	%		1.16	%
Total interest-bearing deposits	0.77	%		0.66	%		0.57	%		0.48	%		0.45	%
Funds purchased and repurchase agreements	1.25	%		0.53	%		0.40	%		0.28	%		0.25	%
Other borrowings	2.20	%		1.96	%		1.60	%		1.36	%		1.29	%
Subordinated debt	5.55	%		5.67	%		5.61	%		5.55	%		5.68	%
Total cost of interest-bearing liabilities	1.25	%		1.11	%		0.93	%		0.79	%		0.75	%
Tax-equivalent net interest revenue spread	2.79	%		2.80	%		2.68	%		2.70	%		2.75	%
Effect of noninterest-bearing funding sources and other	0.42	%		0.37	%		0.31	%		0.27	%		0.26	%
Tax-equivalent net interest margin	3.21	%		3.17	%		2.99	%		2.97	%		3.01	%

Yield calculations are shown on a tax equivalent basis at the statutory federal and state rates for the periods presented. The yield calculations exclude security trades that have been recorded on trade date with no corresponding interest income and the unrealized gains and losses. The yield calculation also includes average loan balances for which the accrual of interest has been discontinued and are net of unearned income. Yield/rate calculations are generally based on the conventions that determine how interest income and expense is accrued.

CREDIT QUALITY INDICATORS -- UNAUDITED BOK FINANCIAL CORPORATION (in thousands, except ratios)
	Three Months Ended
	Sept. 30, 2018				June 30, 2018				Mar. 31, 2018				Dec. 31, 2017				Sept. 30, 2017
Nonperforming assets:
Nonaccruing loans:
Commercial	$	109,490			$	120,978			$	131,460			$	137,303			$	176,900
Commercial real estate	1,316				1,996				2,470				2,855				2,975
Residential mortgage	41,917				42,343				45,794				47,447				45,506
Personal	269				340				340				269				255
Total nonaccruing loans	152,992				165,657				180,064				187,874				225,636
Accruing renegotiated loans guaranteed by U.S. government agencies	83,347				75,374				74,418				73,994				69,440
Real estate and other repossessed assets	24,515				27,891				23,652				28,437				32,535
Total nonperforming assets	$	260,854			$	268,922			$	278,134			$	290,305			$	327,611
Total nonperforming assets excluding those guaranteed by U.S. government agencies	$	169,717			$	185,981			$	194,833			$	207,132			$	249,280
Nonaccruing loans by loan class:
Commercial:
Energy	$	54,033			$	65,597			$	89,942			$	92,284			$	110,683
Healthcare	15,704				16,125				15,342				14,765				24,446
Wholesale/retail	9,249				14,095				2,564				2,574				1,893
Manufacturing	9,202				2,991				3,002				5,962				9,059
Services	4,097				4,377				2,109				2,620				1,174
Other commercial and industrial	17,205				17,793				18,501				19,098				29,645
Total commercial	109,490				120,978				131,460				137,303				176,900
Commercial real estate:
Retail	777				1,068				264				276				289
Residential construction and land development	350				350				1,613				1,832				1,924
Office	—				275				275				275				275
Industrial	—				—				—				—				—
Multifamily	—				—				—				—				—
Other commercial real estate	189				303				318				472				487
Total commercial real estate	1,316				1,996				2,470				2,855				2,975
Residential mortgage:
Permanent mortgage	22,855				23,105				24,578				25,193				24,623
Permanent mortgage guaranteed by U.S. government agencies	7,790				7,567				8,883				9,179				8,891
Home equity	11,272				11,671				12,333				13,075				11,992
Total residential mortgage	41,917				42,343				45,794				47,447				45,506
Personal	269				340				340				269				255
Total nonaccruing loans	$	152,992			$	165,657			$	180,064			$	187,874			$	225,636
Performing loans 90 days past due1	$	518			$	879			$	90			$	633			$	253
Gross charge-offs	$	11,073			$	15,105			$	2,890			$	14,749			$	5,825
Recoveries	(2,092		)		(4,578		)		(1,576		)		(3,061		)		(2,437		)
Net charge-offs	$	8,981			$	10,527			$	1,314			$	11,688			$	3,388
Provision for credit losses	$	4,000			$	—			$	(5,000	)		$	(7,000	)		$	—
Allowance for loan losses to period end loans	1.15		%		1.19		%		1.29		%		1.34		%		1.44		%
Combined allowance for credit losses to period end loans	1.16		%		1.21		%		1.32		%		1.37		%		1.47		%
Nonperforming assets to period end loans and repossessed assets	1.42		%		1.49		%		1.60		%		1.69		%		1.90		%
Net charge-offs (annualized) to average loans	0.20		%		0.24		%		0.03		%		0.27		%		0.08		%
Allowance for loan losses to nonaccruing loans1	145.02		%		136.09		%		130.84		%		129.09		%		114.28		%
Combined allowance for credit losses to nonaccruing loans1	146.41		%		137.63		%		133.25		%		131.18		%		116.78		%

¹   Excludes residential mortgage loans guaranteed by agencies of the U.S. government.

SEGMENTS -- UNAUDITED BOK FINANCIAL CORPORATION (in thousands, except ratios)
		Three Months Ended												Change
Commercial Banking		Sept. 30, 2018				June 30, 2018				Sept. 30, 2017				3Q18 vs 2Q18			3Q18 vs 3Q17
Net interest revenue		$	145,147			$	145,025			$	135,112			0.1	%		7.4	%
Fees and commissions revenue		39,391				42,874				44,747				(8.1	)%		(12.0	)%
Other operating expense		49,136				47,483				47,430				3.5	%		3.6	%
Corporate expense allocations		11,027				11,269				8,733				(2.1	)%		26.3	%
Net income		84,963				87,577				68,610				(3.0	)%		23.8	%
Average assets		18,499,979				18,072,155				17,780,494				2.4	%		4.0	%
Average loans		15,321,600				14,900,918				14,511,639				2.8	%		5.6	%
Average deposits		8,633,204				8,379,584				8,727,221				3.0	%		(1.1	)%
Consumer Banking
Net interest revenue		$	40,114			$	39,294			$	35,946			2.1	%		11.6	%
Fees and commissions revenue		44,038				46,332				45,006				(5.0	)%		(2.2	)%
Other operating expense		53,187				55,906				56,147				(4.9	)%		(5.3	)%
Corporate expense allocations		15,863				15,867				16,920				—	%		(6.2	)%
Net income		9,162				6,102				4,809				50.1	%		90.5	%
Average assets		8,323,542				8,353,558				8,683,998				(0.4	)%		(4.2	)%
Average loans		1,719,679				1,716,259				1,724,523				0.2	%		(0.3	)%
Average deposits		6,580,395				6,579,635				6,663,969				—	%		(1.3	)%
Wealth Management
Net interest revenue		$	29,398			$	29,306			$	20,774			0.3	%		41.5	%
Fees and commissions revenue		83,562				70,489				75,915				18.5	%		10.1	%
Other operating expense		62,255				61,491				61,792				1.2	%		0.7	%
Corporate expense allocations		11,126				11,142				9,819				(0.1	)%		13.3	%
Net income		29,331				20,358				15,472				44.1	%		89.6	%
Average assets		8,498,363				8,495,557				6,992,021				—	%		21.5	%
Average loans		1,439,774				1,413,170				1,324,574				1.9	%		8.7	%
Average deposits		5,492,048				5,834,669				5,495,250				(5.9	)%		(0.1	)%
Fiduciary assets		45,560,107				46,531,900				45,177,185				(2.1	)%		0.8	%
Assets under management or administration		77,628,015				78,873,446				77,650,909				(1.6	)%		—	%

For Further Information Contact:
Katy Hall                    
(918) 595-3030