BOK Financial sees surge in health care, energy loans in 1Q

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BOK Financial reported strong demand for loans to the health care and energy sectors in the first quarter but overall loan growth at the Tulsa, Okla., company was muted due to a cycle of early paydowns that led to a decline in commercial real estate loan balances.

The $39.7 billion-asset company said Wednesday that loans to health care firms climbed 4.1% between Dec. 31 and March 31 to $2.9 billion while loans to energy-related companies increased 3.2% to $3.7 billion. Total loans increased just 0.4%, however, to $21.8 billion as CRE loan balances fell by more than 3%.

For the quarter, BOK reported a profit of $110.5 million, or 1.8% more than it earned in last year’s fourth quarter. Earnings per share were $1.54, or 3 cents below the mean estimates of analyst polled by FactSet Research Systems. The company said that integration costs related to its October acquisition of CoBiz Financial in Denver reduced earnings per share by about 13 cents.

Overall profits were suppressed somewhat by rising interest expenses. While interest revenue climbed nearly 3% quarter over quarter, net interest revenue fell due to a 23% increase in interest expenses. Also, growth in fee revenue was flat as strong gains in brokerage and trading and mortgage banking were offset by declines in fees from deposit service charges and other revenue.

Steven Bradshaw, BOK’s president and CEO, called the results “a great start to the year … with continued growth in our loan portfolio led by our specialty lines of business, and re-energized activity in our brokerage and trading and mortgage businesses.”

He added that the economy in BOK’s seven-state footprint “is strong and the credit environment remains benign with no trouble spots on the horizon.”

BOK’s shares were trading at $86.16 at midday Wednesday, down 1.35% from Tuesday’s closing price.

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