Company: BOKF
Filing Date: 2025-04-30
Form Type: 10-Q
Source: 0000875357-25-000027
Chunk: 5

Company: BOK FINANCIAL CORP
Filing Date: 2025-04-30
Form: 10-Q
Item: Part I, Item 2
Chunk 5
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17 basis points to 5.07%.

Funding costs were 3.42%, a 27 basis point decrease compared to the prior quarter. 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.

Our overall objective is to manage the Company's balance sheet for changes in interest rates as is further described in the Market Risk section of this report. Approximately 82% of our commercial and commercial real estate loan portfolios are either variable rate or fixed rate that will reprice within one year. These loans are funded primarily by deposit accounts that are either non-interest bearing, or that reprice more slowly than the loans. The result is a balance sheet that is asset sensitive, which means that assets generally reprice more quickly than the liabilities. One of the strategies that we use to manage toward a relative rate-neutral position is to purchase fixed-rate residential mortgage-backed securities issued primarily by U. S. government agencies and fund them with market rate-sensitive liabilities. The liability-sensitive nature of this strategy provides an offset to the asset-sensitive characteristics of our loan portfolio. We also may use derivative instruments to manage our interest rate risk.

The effectiveness of these strategies is reflected in the overall change in net interest income due to changes in interest rates as shown in Table 1 and in the interest rate sensitivity projections as shown in the Market Risk section of this report.

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

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Table 1 - Volume/Rate Analysis

(In thousands)

                                                             Three Months Ended                                                                                             
                                                  Mar. 31, 2025 / Dec. 31, 2024                                                                                             
                                                                                                   Change Due To 1                                                          
                                                                         Change                             Volume                                                          
 ────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────
  Tax-equivalent interest revenue:                                                                                                                                          
  Interest-bearing cash and cash equivalents                                  $          (93)                    $         (224)         (776)          (74)         (702)  
  Trading securities                                                                    5,054                              2,388         5,571         6,255                
  Investment securities                                                   (