BOK Financial's Q1 Earnings Miss on Lower Fee Income, Stock Slides

Core Viewpoint - BOK Financial Corporation (BOKF) reported lower-than-expected first-quarter 2025 results, with earnings of $1.86 per share, missing the Zacks Consensus Estimate of $2.01, although the earnings grew 44.2% year-over-year [1][2] Financial Performance - Net income attributable to shareholders was $119.8 million, reflecting a year-over-year increase of 43.1% [2] - Quarterly net revenues reached $502.3 million, a 10.3% increase year-over-year, but fell short of the Zacks Consensus Estimate of $518.5 million [3] - Net interest income was $316.3 million, up 7.7%, with the net interest margin expanding by 17 basis points to 2.78% [3] - Total fees and commissions decreased to $184.1 million, down 8.2%, primarily due to lower brokerage and trading revenues [3] Expense and Efficiency - Total other operating expenses were $347.5 million, an increase of 2.1% year-over-year, mainly driven by higher personnel expenses [4] - The efficiency ratio rose to 68.31% from 67.13% in the prior year, indicating a deterioration in profitability [4] Loan and Deposit Trends - Total loans as of March 31, 2025, were $23.7 billion, down 1.8% from the prior quarter, primarily due to a decline in commercial loans [5] - Total deposits increased by 1.4% sequentially to $38.4 billion, driven by interest-bearing transaction deposits and savings [5] Credit Quality - Non-performing assets decreased to $85 million, or 0.36% of outstanding loans, down from $122.4 million, or 0.51%, in the prior-year quarter [6] - The company recorded no provisions for credit losses compared to $8 million in the prior-year quarter, with net charge-offs of $1.1 million, down 79.8% [6] Capital and Profitability Ratios - As of March 31, 2025, the common equity Tier 1 capital ratio improved to 13.31% from 11.99% a year earlier [7] - Return on average equity was 8.59%, up from 6.53% in the previous year, while return on average assets increased to 0.95% from 0.67% [7] Share Repurchase Activity - During the reported quarter, BOK Financial repurchased 10,000 shares for $0.99 million [8] Market Position - The company maintains a solid loan and deposit balance, which is expected to support top-line growth, alongside improving asset quality amid a challenging operating environment [9]