BOK Financial posts $160 million third-quarter profit

BOK Financial Corporation (BOKF) reported third-quarter net income of $159.9 million, or $2.64 per diluted share, a decline from $176.5 million, or $2.92 per diluted share, in the prior quarter. The company noted that excluding a net gain from the exchange of Visa B shares and a loss from repositioning its available-for-sale securities portfolio, prior quarter net income would have been $156.5 million, or $2.59 per diluted share.

Net interest income rose to $370.0 million, an increase of $18.1 million over the second quarter of 2026. The net interest margin expanded to 3.00% from 2.91% in the prior period. Management attributed the improvement to loan growth and fixed-rate asset repricing. Average earning assets increased by $633 million, while average loan balances grew by $468 million to $27.2 billion.

The yield on average earning assets climbed 10 basis points to 5.37%. The loan portfolio yield increased 4 basis points to 6.24%, and the yield on trading securities jumped 30 basis points to 5.15%. Funding costs edged up 3 basis points to 2.96%, with the cost of interest-bearing deposits rising 3 basis points to 2.70%. The benefit to net interest margin from assets funded by noninterest-bearing liabilities was 59 basis points, up 2 basis points from the previous quarter.

Fees and commissions revenue fell to $188.0 million from $202.0 million in the prior quarter. Brokerage and trading revenue decreased by $13.0 million due to an unfavorable rate environment and lower fixed-income trading volumes. Mortgage banking revenue also declined, while transaction card revenue increased.

Operating expense remained stable at $360.7 million, with both personnel and non-personnel costs consistent with the second quarter of 2026. Period-end loans grew by $646 million to $27.7 billion, led by expansion in energy loans, loans secured by industrial facilities, and mortgage finance loans.

Nonperforming assets rose to $67 million, representing 0.24% of outstanding loans and repossessed assets as of September 30, 2026. This compares to $63 million, or 0.23%, at the end of June 2026. Net charge-offs for the third quarter totaled $886 thousand, which equates to 0.01% of average loans on an annualized basis.

On the liability side, period-end deposits decreased by $324 million to $39.5 billion, while average deposits increased by $304 million over the same period. The loan-to-deposit ratio rose to 70% at September 30, 2026, from 68% at June 30, 2026.

Capital ratios showed a slight decrease in tangible common equity ratio to 9.16% from 9.61% at the end of the second quarter. The common equity Tier 1 capital ratio stood at 12.73%, and the total capital ratio was 14.43%.

Stacy Kymes, President and CEO of BOK Financial Corporation, stated that the company delivered a strong quarter with continued expansion in core net interest income and peer-leading credit outcomes. Kymes noted that while higher rates created headwinds for mortgage banking and fixed-income trading, management views these businesses through the cycle as important sources of diversification.

The company managed its balance sheet to exit the quarter with top-quartile tangible common equity despite rapidly increasing interest rates. Kymes emphasized that these results reflect consistent decisions regarding capital, liquidity, interest rate risk, and credit over many years.