1     Comparisons are to prior quarter unless otherwise noted.

Stacy Kymes, President and CEO, stated, “Our results this quarter are a testament to the strength and adaptability of our organization and our ability to navigate through times of uncertainty and extraordinary market volatility. Our diverse business model performed well this quarter and our diligent risk management practices were on display despite recent market disruptions and geopolitical events. Net interest income continues to expand, our loan pipeline is strong, credit quality remains excellent and we have incredibly strong capital and liquidity levels. While volatile market conditions may cause temporary headwinds for some of our fee businesses, the model we’ve created is built for long-term success, not just short-term results." Net interest income was $316.3 million for the first quarter of 2025, an increase of $3.2 million over the prior quarter.

Net interest margin expanded to 2.78% from 2.75%, primarily attributable to liabilities re-pricing lower more quickly than assets during the quarter. For the first quarter of 2025, our core net interest margin excluding trading activities, a non-GAAP measure, decreased 4 basis points to 3.05% compared to 3.09% in the prior quarter.

Average earning assets increased $231 million. Average trading securities increased $245 million. Average loan balances increased $44 million, largely due to growth in portfolio balances for commercial real estate loans and loans to individuals, largely offset by a decrease in commercial loans. Average interest-bearing deposits increased $762 million, primarily from interest-bearing transaction accounts. Funds purchased and repurchase agreements decreased $141 million, while average other borrowings increased $137 million.

The yield on average earning assets was 5.45%, a 14 basis point decrease from the prior quarter. The loan portfolio yield decreased 30 basis points to 6.71% as the majority of our portfolio is floating rate and realized a full quarter impact of the fed funds rate cuts in the latter half of 2024. The yield on trading securities was up 17 basis points to 5.07%.

Funding costs were 3.42%, down 27 basis points. The cost of interest-bearing deposits decreased 24 basis points to 3.24%. The cost of funds purchased and repurchase agreements decreased 73 basis points to 3.05%, while the cost of other borrowings decreased 38 basis points to 4.57%. The benefit to net interest margin from assets funded by non-interest liabilities was 75 basis points, a decrease of 10 basis points.

Fees and commissions revenue totaled $184.1 million for the first quarter of 2025, a decrease of $22.8 million compared to the prior quarter.

Brokerage and trading revenue decreased $24.4 million to $31.1 million, primarily driven by lower trading volumes and compressed spreads for U.S. agency mortgage-backed securities, as demand slowed due to market volatility from major geopolitical risks. We also experienced seasonally weaker municipal pipelines during the quarter.

Mortgage banking revenue increased $1.7 million led by higher production as client demand begins to grow and inventory constraints start to ease. Mortgage production volume increased $8.9 million, and realized margin on funded mortgage loans improved 4 bps.

Other gains (losses), net, were a net loss of $725 thousand for the first quarter of 2025, compared to a net gain of $5.0 million in the prior quarter. Unrealized gain on merchant banking investments was $678 thousand and loss on investments related to deferred compensation was $1.1 million for the first quarter of 2025, compared to a gain on merchant banking investments of $2.2 million and a gain of $2.5 million on investments related to deferred compensation in the prior quarter.

Total operating expense was $347.5 million for the first quarter of 2025, consistent with the prior quarter.

Personnel expense was $214.2 million, an increase of $3.5 million. Employee benefits expense increased $7.7 million, primarily due to a seasonal increase in payroll taxes. Regular compensation costs grew $3.2 million due to standard annual merit increases effective for most employees in March. Cash-based incentive compensation expense decreased $4.6 million, primarily driven by reduced trading activity. Deferred compensation expense decreased $3.2 million; however, this was largely offset by a decrease in the value of related investments included in Other gains (losses), net.

Non-personnel expense was $133.3 million, a decrease of $3.6 million. Lower prepayments led to a $3.0 million decrease in mortgage banking costs. Professional fees and services expense decreased $1.9 million, largely related to lower technology project costs. Other expense increased by $1.3 million due to higher operational losses.

Outstanding loans were $23.7 billion at March 31, 2025, a decrease of $424 million compared to December 31, 2024, largely due to a decrease in commercial loans, partially offset by growth in commercial real estate loans and loans to individuals. Unfunded loan commitments decreased $189 million compared to the fourth quarter of 2024.

Outstanding commercial loan balances, which includes healthcare, services, energy, and general business loans, decreased $627 million compared to the prior quarter.

Energy loan balances decreased $394 million to $2.9 billion, or 12% of total loans. The majority of this portfolio is first lien, senior secured, reserve-based lending to oil and gas producers, which we believe is the lowest risk form of energy lending. Approximately 72% of committed production loans are secured by properties primarily producing oil. The remaining 28% is secured by properties primarily producing natural gas. Unfunded energy loan commitments were $4.4 billion at March 31, 2025, a $16 million increase over December 31, 2024.

Healthcare sector loan balances decreased $178 million and totaled $3.8 billion, or 16% of total loans. Our healthcare sector loans primarily consist of $3.1 billion of senior housing and care facilities, including independent living, assisted living, and skilled nursing. Generally, we loan to borrowers with a portfolio of multiple facilities, which serves to help diversify risks specific to a single facility.

General business loans decreased $116 million to $4.0 billion, or 17% of total loans. General business loans include $2.4 billion of wholesale/retail loans and $1.6 billion of loans from other commercial industries.

Services sector loan balances increased $62 million to $3.7 billion, or 16% of total loans. Services loans consist of a large number of loans to a variety of businesses, including Native American tribal and state and local municipal government entities, Native American tribal casino operations, foundations and not-for-profit organizations, educational services, and specialty trade contractors.

Commercial real estate loan balances increased $105 million to $5.2 billion, representing 22% of total loans. Loans secured by multifamily properties increased $99 million to $2.3 billion and loans secured by industrial facilities increased $35 million to $1.2 billion. The increases in these portfolios were partially offset by a $51 million decrease in loans secured by office facilities. Unfunded commercial real estate loan commitments were $1.9 billion at March 31, 2025, a $45 million decrease compared to December 31, 2024. We take a disciplined approach to managing our concentration of commercial real estate loan commitments as a percentage of capital.

Loans to individuals increased $97 million to $4.1 billion and represent 17% of total loans. Personal loans increased $66 million, while residential mortgage loans increased $31 million.

Our funding sources, which primarily include deposits and wholesale borrowings, provide adequate liquidity to meet our needs. The loan to deposit ratio was 62% at March 31, 2025, compared to 63% at December 31, 2024, providing significant on-balance sheet liquidity to meet future loan demand and contractual obligations.

Period end deposits totaled $38.3 billion at March 31, 2025, a $90 million increase. Interest-bearing transaction account balances increased $207 million, while demand deposits decreased $83 million. Time deposits decreased $69 million.

Average deposits were $38.4 billion at March 31, 2025, a $540 million increase. Average interest-bearing transaction account balances increased $867 million. Average demand deposit account balances decreased $222 million and average time deposits decreased $131 million.

Average Commercial Banking deposits decreased $173 million to $17.8 billion, or 46% of total deposits. Our commercial deposit portfolio is highly diversified across industries and customers. The highest concentration by industry within our commercial deposit portfolio is with our energy customers representing 9% of our total deposits. Consumer Banking deposits decreased $43 million to $8.2 billion, or 21% of total deposits. Average Wealth Management deposits increased by $719 million to $10.7 billion, or 28% of total deposits.

1     See Explanation and Reconciliation of Non-GAAP Measures following.

The company's common equity Tier 1 capital ratio was 13.31% at March 31, 2025. In addition, the company's Tier 1 capital ratio was 13.31%, total capital ratio was 14.54%, and leverage ratio was 10.02% at March 31, 2025. At December 31, 2024, the company's common equity Tier 1 capital ratio was 13.03%, Tier 1 capital ratio was 13.04%, total capital ratio was 14.21%, and leverage ratio was 9.97%.

The company's tangible common equity ratio, a non-GAAP measure, was 9.48% at March 31, 2025, and 9.17% at December 31, 2024. The tangible common equity ratio is primarily based on total shareholders' equity, which includes unrealized gains and losses on available-for-sale securities. Adjusted for all unrealized securities portfolio gains and losses, including those in the investment portfolio, the tangible common equity ratio would be 9.23%.

Nonperforming assets totaled $85 million, or 0.36% of outstanding loans and repossessed assets, at March 31, 2025, compared to $49 million, or 0.20%, at December 31, 2024. Excluding loans guaranteed by U.S. government agencies, nonperforming assets totaled $79 million, or 0.33% of outstanding loans and repossessed assets, at March 31, 2025, compared to $42 million, or 0.18%, at December 31, 2024.

Nonaccruing loans increased $37 million compared to December 31, 2024. New nonaccruing loans identified in the first quarter totaled $39 million, partially offset by $2.0 million in payments received and $2.3 million in charge-offs. Nonaccruing healthcare loans increased $16 million and nonaccruing services loans increased $13 million.

Net charge-offs were $1.1 million, or 0.02% of average loans on an annualized basis, in the first quarter. Net charge-offs were $528 thousand, or 0.01% of average loans on an annualized basis, in the fourth quarter of 2024.

Consistent with the prior quarter, no provision for expected credit losses was necessary for the first quarter of 2025. A worse economic outlook compared to the prior quarter was offset by decreased loan balances and further improvements in portfolio credit quality during the quarter.

At March 31, 2025, the combined allowance for loan losses and accrual for off-balance sheet credit risk from unfunded loan commitments was $331 million, or 1.40% of outstanding loans and 431% of nonaccruing loans, excluding residential mortgage loans guaranteed by U.S. government agencies. At December 31, 2024, the combined allowance for loan losses and accrual for off-balance sheet credit risk from unfunded loan commitments was $332 million, or 1.38% of outstanding loans and 831% of nonaccruing loans.

The fair value of the available-for-sale securities portfolio totaled $13.1 billion at March 31, 2025, a $251 million increase over December 31, 2024. At March 31, 2025, the available-for-sale securities portfolio consisted primarily of $8.8 billion of residential mortgage-backed securities fully backed by U.S. government agencies and $3.3 billion of commercial mortgage-backed securities fully backed by U.S. government agencies. At March 31, 2025, the available-for-sale securities portfolio had a net unrealized loss of $364 million, compared to $537 million at December 31, 2024.

We hold an inventory of trading securities in support of sales to a variety of customers. At March 31, 2025, the trading securities portfolio totaled $5.9 billion, compared to $4.9 billion at December 31, 2024.

The company also maintains a portfolio of residential mortgage-backed securities issued by U.S. government agencies and interest rate derivative contracts as an economic hedge of the changes in the fair value of our mortgage servicing rights. This portfolio of fair value option securities decreased $326 thousand to $17.6 million at March 31, 2025.

Derivative contracts are carried at fair value. At March 31, 2025, the net fair values of derivative contracts, before consideration of cash margin, reported as assets under our customer derivative programs totaled $428 million, compared to $242 million at December 31, 2024. The aggregate net fair value of derivative contracts, before consideration of cash margin, held under these programs reported as liabilities totaled $386 million at March 31, 2025, and $205 million at December 31, 2024.

The net benefit of the changes in the fair value of mortgage servicing rights and related economic hedges was $2.2 million during the first quarter of 2025, including a $9.5 million increase in the fair value of securities and derivative contracts held as an economic hedge, a $7.2 million decrease in the fair value of mortgage servicing rights, and $71 thousand of related net interest expense.

Commercial Banking contributed $140.0 million to net income before taxes in the first quarter of 2025, a decrease of $20.4 million compared to the fourth quarter of 2024. Combined net interest income and fee revenue decreased $22.9 million, primarily due to reduced loan spreads as the majority of our portfolio is floating rate and realized a full quarter impact of the fed funds rate cuts in the latter half of 2024, along with lower loan balances. Personnel expense decreased $1.5 million due to lower incentive compensation costs during the quarter, and non-personnel expense decreased $3.1 million, primarily due to reduced costs related to ongoing projects. Other gains (losses), net, declined $1.5 million related to reduced gains on merchant banking investments. Average loans were largely unchanged from the previous quarter. Average deposits declined $173 million, or 1%, to $17.8 billion.

Consumer Banking contributed $22.1 million to net income before taxes in the first quarter of 2025, a decrease of $1.5 million compared to the prior quarter. Combined net interest income and fee revenue decreased $7.4 million, largely due to a reduction in the spread on deposits, partially offset by an increase in mortgage banking revenue from higher production volumes. Other operating expenses decreased $2.7 million, primarily due to lower mortgage costs. The net benefit of the changes in the fair value of mortgage servicing rights and related economic hedges was $2.2 million, compared to a net cost of $2.2 million in the prior quarter. Average loans increased $59 million, or 3%, to $2.2 billion. Average deposits were largely unchanged from the previous quarter.

Wealth Management contributed $32.7 million to net income before taxes in the first quarter of 2025, a decrease of $16.2 million compared to the fourth quarter of 2024. Combined net interest income and fee revenue decreased $15.6 million. Total revenue from trading activities decreased $14.4 million, primarily driven by lower U.S. agency residential mortgage-backed securities trading volumes and tightened spread as client demand was muted given the current market conditions. During the first quarter of 2025, trading-related fee revenue began to shift to net interest income due to the steepening of the yield curve. Other operating expense was relatively consistent with the prior quarter as lower sales-based incentive compensation expense driven by decreased trading activity was largely offset by increased data processing and communications expense. Average loans increased $27 million, or 1%, to $2.2 billion. Average deposits increased $719 million, or 7%, to $10.7 billion. Assets under management or administration were $114.0 billion, a decrease of $659 million, or 1%.

The company will hold a conference call at noon Central time on Tuesday, April 22, 2025, to discuss the financial results with investors. The live audio webcast and presentation slides will be available on the company’s website at bokf.com. The conference call can also be accessed by dialing 1-800-715-9871 toll free, or 1-646-307-1963, conference ID: 6617678. A webcast replay will also be available shortly after the conclusion of the live call at bokf.com or by dialing 1-800-770-2030 and referencing replay PIN: 6617678.

BOK Financial Corporation is a $50 billion regional financial services company headquartered in Tulsa, Oklahoma with $114 billion in assets under management or administration. The company's stock is publicly traded on NASDAQ under the Global Select market listings (BOKF). BOK Financial Corporation's holdings include BOKF, NA; BOK Financial Securities, Inc.; and BOK Financial Private Wealth, Inc. BOKF, NA's holdings include TransFund and Cavanal Hill Investment Management, Inc. BOKF, NA operates banking divisions across eight states as: Bank of Albuquerque; Bank of Oklahoma; Bank of Texas; and BOK Financial in Arizona, Arkansas, Colorado, Kansas and Missouri; as well as having limited purpose offices in Nebraska, Wisconsin, Connecticut and Tennessee. Through its subsidiaries, BOK Financial Corporation provides commercial and consumer banking, brokerage trading, 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 March 31, 2025 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 Corporation, the financial services industry and the economy generally. Words such as “anticipates,” “believes,” “estimates,” “expects,” “forecasts,” “plans,” “outlook,” “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 acquisitions and 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 various forward-looking 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 government, changes in governmental economic policy, including tariffs, 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. BOK Financial Corporation 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.

1     See Reconciliation of Non-GAAP Measures following.

2     Excludes 1% excise tax on corporate stock repurchases.

3     Actual interest earned on fair value option securities less internal transfer-priced cost of funds.