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BOK Financial (BOKF) Q4 Earnings & Revenues Miss, Stock Down 7%

·4 min read

Shares of BOK Financial BOKF tanked 7.08% in response to disappointing fourth-quarter 2021 results. Earnings per share of $1.71 missed the Zacks Consensus Estimate of $1.81. The bottom line decreased 22.6% from the prior-year quarter.

Results were undermined by lower fees and commissions, and a decline in loan balance. Nonetheless, lower expenses, higher net interest revenues and provision benefits were tailwinds.

Net income attributable to shareholders was $117.3 million, down 23.9% year over year.

In 2021, earnings of $8.95 per share missed the consensus estimate of $9.08. Net income was $618 million, up significantly from $435 million in 2020.

Revenues, Costs & Loan Balance Decline

Net revenues of $423.4 million (including net interest revenues and total fees and commissions) in the quarter were down 11.5% year over year. The top line lagged the Zacks Consensus Estimate of $453.4 million.

In full-year 2021, net revenues decreased 7.2% to $1.78 billion. The top line missed the consensus estimate of $1.89 billion.

Net interest revenues were $277.1 million in the quarter, down 6.8% year over year. Net interest margin shrunk 20 basis points (bps) to 2.52%.

Total fees and commissions amounted to $146.3 million, down 19.2%. The fall was largely due to lower brokerage and trading revenues, and mortgage banking revenues.

Total other operating expenses were $299.5 million, down 1.1%. The fall was mainly due to lower personnel costs, professional fees, and services and mortgage banking costs.

The efficiency ratio rose to 70.14% from the prior year’s 62.77%. A rise in efficiency ratio indicates deterioration in profitability.

As of Dec 31, 2021, total loans were $20.2 billion, down 0.7% sequentially. As of the same date, total deposits amounted to $41.2 billion, up 7.1%.

Strong Credit Quality

Provision for expected credit losses was a benefit of $17 million compared with $6.5 million in the prior-year quarter. Non-performing assets were $369.3 million or 1.83% of outstanding loans and repossessed assets as of Dec 31, 2021, down from $476.9 million or 2.07% recorded in the prior-year period.

Net recoveries were $0.71 million, against net charge-offs of $16.7 million reported in the prior-year quarter. Allowance for loan losses was 1.27% of outstanding loans as of Dec 31, 2021, down 42 bps year over year.

Capital Position Improves & Profitability Ratios Deteriorate

As of Dec 31, 2021, the common equity Tier 1 capital ratio was 12.23%, up from 11.95% as of Dec 31, 2020.

Tier 1 and total capital ratios on Dec 31, 2021, were 12.24% and 13.28%, respectively, compared with 11.95% and 13.82% as of Dec 31, 2020. The leverage ratio was 8.55%, up from 8.28% as of Dec 31, 2020.

Return on average equity was 8.66% compared with the year-earlier quarter’s 11.75%. Return on average assets was 0.92%, down from the 1.22% recorded in the year-ago quarter.

Share Repurchase Update

In the reported quarter, the company repurchased 128,522 shares at an average price of $104.46 per share.

Our View

BOK Financial’s diverse revenue mix and favorable geographic footprint are likely to keep aiding its financials. Solid deposits balance reflects an efficient organic-growth strategy. However, falling loan balance and margin pressure due to lower rates are concerning.

BOK Financial Corporation Price, Consensus and EPS Surprise

BOK Financial Corporation Price, Consensus and EPS Surprise
BOK Financial Corporation Price, Consensus and EPS Surprise

BOK Financial Corporation price-consensus-eps-surprise-chart | BOK Financial Corporation Quote

BOK Financial currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Earnings Release Schedule of Other Banks

Zions Bancorporation ZION is scheduled to release fourth-quarter and full-year 2021 results on Jan 24.

Over the past 30 days, th Zacks Consensus Estimate for Zions Bancorporation’s quarterly earnings has remained unchanged at $1.33. This implies a 19.9% decrease from the prior-year quarter.

Prosperity Bancshares PB is scheduled to release fourth-quarter and full-year 2021 results on Jan 26.

Over the past 30 days, the Zacks Consensus Estimate for Prosperity Bancshares’ quarterly earnings has remained unchanged at $1.37. This suggests a 7.4% decrease from the prior-year quarter.

East West Bancorp, Inc. EWBC is slated to report fourth-quarter and full-year 2021 results on Jan 27.

Over the past 30 days, the Zacks Consensus Estimate for East West Bancorp’s quarterly earnings has remained unchanged at $1.55. This indicates a 34.8% increase from the prior-year quarter.


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Zions Bancorporation, N.A. (ZION) : Free Stock Analysis Report

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