BOK Financial Corporation’s BOKF fourth-quarter 2023 adjusted earnings per share of $1.78 beat the Zacks Consensus Estimate of $1.72. The bottom line compared unfavorably to the earnings of $2.51 per share a year ago.

The results benefited from a rise in total fees and commissions and higher loans and deposit balances. Moreover, the provisions witnessed a significant decline. However, lower net interest revenues and elevated expenses were the major undermining factors.

The results excluded the charges related to the FDIC special assessment. After considering it, net income attributable to shareholders was $82.6 million, down 51% year over year.

In 2023, earnings per share were $8.02, up 4.4% from 2022. However, the figure missed the Zacks Consensus Estimate of $8.49. Net income attributable to shareholders (GAAP) was $530.7 million, up 2% year over year.

Quarterly Revenues Decline, Expenses Rise

Quarterly net revenues of $501.6 million (net interest revenues and total other operating revenues) were down 8.8% year over year. However, the top line surpassed the Zacks Consensus Estimate of $485.9 million.

In 2023, total revenues were $2.06 billion, up 11.2% year over year. The top line surpassed the Zacks Consensus Estimate of $2.05 billion.

Net interest revenues were $296.7 million, down 15.9% year over year. Net interest margin (NIM) deteriorated 90 basis points to 2.64%.

Total fees and commissions were $196.8 million, up 1.7% year over year. The rise was driven by an increase in almost all fee income components except for brokerage and trading revenues and other revenues. Total other operating expenses were $384.1 million, up 20.6% year over year. The rise was primarily due to an increase in both personnel and non-personnel expenses and $43.8 million of charges related to FDIC special assessment.

The efficiency ratio increased to 71.62% from the prior year’s 56.61%. A rise in the efficiency ratio indicates a deterioration in profitability.

As of Dec 31, 2023, total loans were $23.9 billion, up marginally from the previous quarter. Total deposits amounted to $34 billion, up 1.1%.

Credit Quality Improves

Non-performing assets were $148.3 million or 0.62% of outstanding loans and repossessed assets as of Dec 31, 2023, which declined from $299.6 million or 1.33% recorded in the year-ago period.

Provisions for credit losses was recorded at $6 million, which decreased 60% from the prior-year quarter. Also, the company recorded net charge-offs of $4.1 million, which decreased 73.6% from the prior-year quarter.

However, the allowance for loan losses was 1.16% of outstanding loans as of Dec 31, 2023, which increased from 1.04% year over year.