Company: BANFP
Filing Date: 2025-02-28
Form Type: 10-K
Source: 0000950170-25-030159
Chunk: 50

Company: BANCFIRST CORP /OK/
Filing Date: 2025-02-28
Form: 10-K
Item: Item 7
Chunk 50
---
   

Noninterest Expense 

Total noninterest expense increased by $14.7 million, or 4.4% for 2024. Higher noninterest expenses in 2024 were primarily related to growth in salaries and employee benefits of $12.0 million related to annual merit increases and new hires. Data processing expense increased $2.4 million in 2024 compared to 2023. Net expense from other real estate owned decreased $2.9 million, which was due to a decrease of $1.2 million of write downs on other real estate owned, a $731,000 increase in the cost of holding other real estate owned, and a decrease in gain on the sales of other real estate owned of $924,000. 

Noninterest expense included deposit insurance expense, which totaled $6.4 million for the year ended December 31, 2024, compared to $5.8 million for the year ended December 31, 2023 and $4.7 million for the year ended December 31, 2022. 

Income Taxes 

Income tax expense totaled $58.9 million in 2024, compared to $57.5 million in 2023 and $44.3 million in 2022. The effective tax rates for 2024, 2023 and 2022 were 21.4%, 21.3% and 18.7% respectively. The Company's adoption of ASU 2023-02 in the first quarter of 2023 increased income tax expense due to the amortization of $6.0 million of New Markets Tax Credits ("NMTC") and other tax credits to income tax expense during the period that would have previously been recorded to other expense, which increased the effective tax rate by 2.22%. 

The primary reasons for the difference between the Company’s effective tax rate and the federal statutory rate were tax-exempt income, nondeductible amortization, federal and state tax credits and state tax expense. 

Certain financial information is prepared on a taxable equivalent basis to facilitate analysis of yields and changes in components of earnings. Average balance sheets, comprehensive income statements and other financial statistics are also presented on a taxable equivalent basis. 

Impact of Inflation 

The impact of inflation on financial institutions differs significantly from that of industrial or commercial companies. The assets of financial institutions are predominantly monetary, as opposed to fixed or nonmonetary assets such as premises, equipment and inventory. As a result, there is little exposure to inflated earnings by underst