##### Table of Contents



FORM 10-K
 SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
 For the Year Ended December 31, 2009
 Commission File Number 0-23064
 SOUTHWEST BANCORP, INC.
  Oklahoma
    
    73-1136584(State or other jurisdiction of 
incorporation or organization)
    
    (I.R.S. Employer Identification No.)608 South Main Street, Stillwater,Oklahoma
(Address of principal executive office)
    
    74074
(Zip Code)
 : (405) 742-1800
  Title of Each Class
    
    Name of Each Exchange on which RegisteredCommon Stock, par value $1.00 per share
    
    The NASDAQ Stock Market
 None
 o þ
 o þ
 þ o
 o o
 þ
  Large accelerated filer o
Accelerated filer þ
Non-accelerated filer o(Do not check if a smaller reporting company)
Smaller reporting company o
 o þ
    Part III:
    
    Portions of the definitive proxy statement for the Annual Meeting of Shareholders to be held on April 22, 2010 (the Proxy
Statement).




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##### 



SOUTHWEST BANCORP, INC.
  
 IndexForward-Looking Statements
    
    iiForm 10-K Cross Reference Sheet
    
    iiSouthwest Bancorp, Inc.
    
    ivAbout This Report
    
    ivFive Year Summary of Selected Financial Data
    
    
    1Securities Listing, Prices, and Dividends
    
    
    3Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    5Controls and Procedures
    
    
    30Reports of Independent Registered Public Accounting Firm
    
    
    31Consolidated Financial Statements
    
    
    33Notes to the Consolidated Financial Statements
    
    
    38Other Material Required by Form 10-K
    
    
    73Description of Business
    
    
    73Board of Directors
    
    
    83Executive Officers
    
    
    84Risk Factors
    
    
    87Properties
    
    
    94Exhibits, Financial Statement Schedules
    
    
    97Signatures
    
    
    100EX-21EX-23EX-24EX-31.AEX-31.BEX-32.AEX-32.BEX-99.AEX-99.B
  i




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##### Table of Contents



FORWARD-LOOKING STATEMENTS
 SOUTHWEST BANCORP, INC.
 
 Form 10-K Cross Reference Sheet of Material Incorporated by Reference
  Item of Form 10-K
    
    LocationPart IItem 1.
    
    Business
    
    Forward-Looking Statements on page ii, Southwest
Bancorp, Inc. on page iv, About this Report on
page iv, and Business on pages 73 through 82.Item 1A.
    
    Risk Factors
    
    Risk Factors on pages 87 through 91.Item 1B.
    
    Unresolved Staff Comments
    
    None.Item 2.
    
    Properties
    
    Properties on pages 94 through 96.Item 3.
    
    Legal Proceedings
    
    Note 18 Commitments and Contingencies on page 66.Item 4.
    
    Submission of Matters to
a Vote of Security
Holders
    
    Not applicable. No matter was submitted to a vote of
security holders during the fourth quarter of 2009.PART IIItem 5.
    
    Market for Registrants
Common Equity, Related
Stockholder Matters, and
Issuer Purchases of
Equity Securities
    
    Securities Listing, Prices, and Dividends on page 3.Item 6.
    
    Selected Financial Data
    
    Five Year Summary of Selected Financial Data on
pages 1 and 2.Item 7.
    
    Managements Discussion
and Analysis of
Financial Condition and
Results of Operations
    
    Managements Discussion and Analysis of Financial
Condition and Results of Operations on pages 5
through 30.Item 7A.
    
    Quantitative and
Qualitative Disclosures
about Market Risk
    
    The section titled Asset/Liability Management
Quantitative and Qualitative Disclosures about Market
Risk on pages 24 through 26.Item 8.
    
    Financial Statements and
Supplementary Data
    
    Pages 33 through 72
 ii




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##### Table of Contents



Item of Form 10-K
    
    LocationItem 9.
    
    Changes in and
Disagreements with
Accountants on
Accounting and Financial
Disclosures
    
    Not applicable. During the past two years or any
subsequent period there has been no change in or
reportable disagreement with the independent
registered public accounting firm for Southwest or
any of its subsidiaries.Item 9A.
    
    Controls and Procedures
    
    Controls and Procedures on page 30.Item 9B.
    
    Other Information
    
    Not applicable. The registrant reported all items
required to be reported in a Form 8-K during the
fourth quarter of 2009.Part IIIItem 10.
    
    Directors, Executive
Officers and
Corporate Governance
    
    The material labeled Election of Directors on
pages 3 through 6 , Board Meetings and Committee on
pages 6 through 10, Section 16(a) Beneficial
Ownership Reporting Compliance on page 29, Code of
Ethics on page 33, Shareholder Proposals and
Communications on page 33, and Report of the Audit
Committee on page 30 of the Proxy Statement is
incorporated by reference in this Report.Item 11.
    
    Executive Compensation
    
    The material labeled Director Compensation on page
12, Executive Compensation on pages 24 through 27,
Compensation Discussion and Analysis on pages 15
through 22, and Compensation Committee Report on
page 23 of the Proxy Statement is incorporated by
reference in this Report.Item 12.
    
    Security Ownership of
Certain Beneficial
Owners and Management
and Related Stockholder
Matters
    
    The material labeled Common Stock Owned by Directors
and Executive Officers on pages 13 and 14 and
Owners of More than 5% of Southwests Common Stock
on page 14 of the Proxy Statement is incorporated by
reference in this Report. Information regarding
securities authorized for issuance under equity
compensation plans is included under Equity
Compensation Plan Information on page 4 of this
report.Item 13.
    
    Certain Relationships
and Related Transactions
and Director
Independence
    
    The material labeled Director Independence on pages
10 through 11, and Certain Transactions on pages 28
and 29 of the Proxy Statement is incorporated by
reference in this Report.Item 14.
    
    Principal Accountant
Fees and Services
    
    The material labeled Relationship with Independent
Public Accountants on pages 29 and 30 of the Proxy
Statement is incorporated by reference in this
Report.Part IVItem 15.
    
    Exhibits, Financial
Statement Schedules
 iii




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##### Table of Contents



Southwest Bancorp, Inc.
 SNB DirectBanker
      
 About This Report
  The SEC has not approved or disapproved this Report or passed upon its accuracy or adequacy.
 iv




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##### Table of Contents



FIVE YEAR SUMMARY OF SELECTED FINANCIAL DATA
  For the Year Ended December 31,(Dollars in thousands, except per share data)
    
    2009
    
    2008
    
    2007
    
    2006
    
    2005Operations DataInterest income
    
    $
    150,399
    
    
    $
    162,794
    
    
    $
    177,068
    
    
    $
    169,760
    
    
    $
    137,344Interest expense
    
    
    51,708
    
    
    
    73,075
    
    
    
    84,471
    
    
    
    76,808
    
    
    
    52,115Net interest income
    
    
    98,691
    
    
    
    89,719
    
    
    
    92,597
    
    
    
    92,952
    
    
    
    85,229Provision for loan losses
    
    
    39,176
    
    
    
    18,979
    
    
    
    8,947
    
    
    
    12,187
    
    
    
    16,155Gain on sales of loans and securities, net (1)
    
    
    5,888
    
    
    
    3,566
    
    
    
    4,923
    
    
    
    3,689
    
    
    
    4,915Noninterest income (2)
    
    
    16,048
    
    
    
    12,572
    
    
    
    11,510
    
    
    
    12,973
    
    
    
    12,368Noninterest expense (3)
    
    
    60,858
    
    
    
    62,488
    
    
    
    65,108
    
    
    
    56,021
    
    
    
    51,503Income before taxes
    
    
    20,593
    
    
    
    24,390
    
    
    
    34,975
    
    
    
    41,406
    
    
    
    34,854Taxes on income
    
    
    7,611
    
    
    
    9,489
    
    
    
    13,597
    
    
    
    15,409
    
    
    
    13,840Net income
    
    $
    12,982
    
    
    $
    14,901
    
    
    $
    21,378
    
    
    $
    25,997
    
    
    $
    21,014Net income available to common shareholders
    
    $
    8,837
    
    
    $
    14,658
    
    
    $
    21,378
    
    
    $
    25,997
    
    
    $
    21,014DividendsPreferred Stock
    
    $
    3,500
    
    
    $
    243
    
    
    $
    
    
    
    $
    
    
    
    $
    Common stock
    
    
    1,398
    
    
    
    5,519
    
    
    
    5,299
    
    
    
    4,681
    
    
    
    4,035Ratio of total dividends to net income
    
    
    37.73
    %
    
    
    38.67
    %
    
    
    24.79
    %
    
    
    18.00
    %
    
    
    19.20
    %Per Share DataBasic earnings per common share
    
    $
    0.60
    
    
    $
    1.01
    
    
    $
    1.49
    
    
    $
    1.84
    
    
    $
    1.60Diluted earnings per common share
    
    
    0.60
    
    
    
    1.00
    
    
    
    1.46
    
    
    
    1.79
    
    
    
    1.55Common stock cash dividends
    
    
    0.0952
    
    
    
    0.3800
    
    
    
    0.3700
    
    
    
    0.3300
    
    
    
    0.3000Book value per common share (4)
    
    
    16.46
    
    
    
    16.18
    
    
    
    15.16
    
    
    
    13.87
    
    
    
    12.16Weighted average common shares outstanding:Basic, net of unvested restricted stock
    
    
    14,625,847
    
    
    
    14,471,242
    
    
    
    14,291,041
    
    
    
    14,151,624
    
    
    
    13,155,742Diluted, net of unvested restricted stock
    
    
    14,689,517
    
    
    
    14,641,521
    
    
    
    14,606,149
    
    
    
    14,483,941
    
    
    
    13,559,885Financial Condition Data (4)Investment securities
    
    $
    263,439
    
    
    $
    264,166
    
    
    $
    256,608
    
    
    $
    270,519
    
    
    $
    268,763Noncovered portfolio loans (5)
    
    
    2,539,294
    
    
    
    2,494,506
    
    
    
    2,145,557
    
    
    
    1,602,726
    
    
    
    1,352,433Loans held for sale (5)
    
    
    43,134
    
    
    
    56,941
    
    
    
    66,275
    
    
    
    188,464
    
    
    
    383,447Total noncovered loans (5) (6)
    
    
    2,582,428
    
    
    
    2,551,447
    
    
    
    2,211,832
    
    
    
    1,791,190
    
    
    
    1,735,880Covered portfolio loans (7)
    
    
    85,405
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Interest-earning assets
    
    
    2,933,856
    
    
    
    2,817,496
    
    
    
    2,478,429
    
    
    
    2,079,380
    
    
    
    2,007,248Total assets
    
    
    3,108,291
    
    
    
    2,879,762
    
    
    
    2,564,298
    
    
    
    2,170,628
    
    
    
    2,099,639Interest-bearing deposits
    
    
    2,267,901
    
    
    
    1,918,181
    
    
    
    1,801,512
    
    
    
    1,511,196
    
    
    
    1,433,265Total deposits
    
    
    2,592,730
    
    
    
    2,180,122
    
    
    
    2,058,579
    
    
    
    1,765,611
    
    
    
    1,657,820Other borrowings
    
    
    103,022
    
    
    
    295,138
    
    
    
    218,356
    
    
    
    138,094
    
    
    
    204,508Subordinated debentures
    
    
    81,963
    
    
    
    81,963
    
    
    
    46,393
    
    
    
    46,393
    
    
    
    46,393Total shareholders equity (8)
    
    
    309,778
    
    
    
    302,203
    
    
    
    217,609
    
    
    
    197,510
    
    
    
    170,444Common shareholders equity
    
    
    242,741
    
    
    
    235,811
    
    
    
    217,609
    
    
    
    197,510
    
    
    
    170,444Mortgage servicing portfolio
    
    
    237,459
    
    
    
    158,143
    
    
    
    141,680
    
    
    
    135,904
    
    
    
    133,470Selected RatiosReturn on average assets
    
    
    0.43
    %
    
    
    0.54
    %
    
    
    0.94
    %
    
    
    1.18
    %
    
    
    1.01
    %Return on average total shareholders equity
    
    
    4.20
    
    
    
    6.40
    
    
    
    10.19
    
    
    
    13.99
    
    
    
    13.78Return on average common equity
    
    
    3.65
    
    
    
    6.44
    
    
    
    10.19
    
    
    
    13.99
    
    
    
    13.78Tangible common equity to tangible assets
    
    
    7.61
    
    
    
    7.96
    
    
    
    8.23
    
    
    
    9.05
    
    
    
    8.11Net interest margin
    
    
    3.38
    
    
    
    3.36
    
    
    
    4.20
    
    
    
    4.42
    
    
    
    4.30Efficiency ratio (9)
    
    
    50.45
    
    
    
    59.03
    
    
    
    59.72
    
    
    
    51.11
    
    
    
    50.24Average assets per employee (10)
    
    $
    6,411
    
    
    $
    6,206
    
    
    $
    4,661
    
    
    $
    5,117
    
    
    $
    5,448
 1




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SELECTED CONSOLIDATED FINANCIAL DATA (CONTINUED)
 At December 31,(Dollars in thousands, except per share data)
    
    2009
    
    2008
    
    2007
    
    2006
    
    2005Asset Quality RatiosAllowance for loan losses (4)
    
    $
    62,413
    
    
    $
    39,773
    
    
    $
    29,584
    
    
    $
    27,293
    
    
    $
    23,812Allowance for loan losses to noncovered
portfolio loans
    
    
    2.46
    %
    
    
    1.59
    %
    
    
    1.38
    %
    
    
    1.70
    %
    
    
    1.76
    %Noncovered nonperforming loans (4) (11)
    
    $
    106,197
    
    
    $
    63,983
    
    
    $
    29,571
    
    
    $
    29,357
    
    
    $
    23,585Noncovered nonperforming loans to noncovered
portfolio loans
    
    
    4.18
    %
    
    
    2.56
    %
    
    
    1.38
    %
    
    
    1.83
    %
    
    
    1.74
    %Allowance for loan losses to noncovered
nonperforming loans
    
    
    58.77
    
    
    
    62.16
    
    
    
    100.04
    
    
    
    92.97
    
    
    
    100.96Noncovered nonperforming assets (4) (12)
    
    $
    124,629
    
    
    $
    70,075
    
    
    $
    32,250
    
    
    $
    31,230
    
    
    $
    30,715Noncovered nonperforming assets to
noncovered portfolio
loans and noncovered
other real estate
    
    
    4.87
    %
    
    
    2.80
    %
    
    
    1.50
    %
    
    
    1.95
    %
    
    
    2.26
    %Net noncovered loan charge-offs (4)
    
    $
    16,754
    
    
    $
    8,790
    
    
    $
    6,656
    
    
    $
    8,706
    
    
    $
    11,334Net noncovered loan charge-offs to average
noncovered portfolio loans
    
    
    0.64
    %
    
    
    0.37
    %
    
    
    0.37
    %
    
    
    0.59
    %
    
    
    0.87
    %Covered nonperforming loans (4) (7) (11)
    
    $
    13,458
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Covered nonperforming loans to covered
portfolio loans
    
    
    15.76
    %
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Covered nonperforming assets (4) (7) (12)
    
    $
    18,206
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Covered nonperforming assets to covered
portfolio loans and
covered other real estate
    
    
    20.19
    %
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Capital RatiosAverage shareholders equity to average assetsTotal
    
    
    10.34
    
    
    
    8.49
    
    
    
    9.21
    
    
    
    8.47
    
    
    
    7.34Common
    
    
    8.11
    
    
    
    8.30
    
    
    
    9.21
    
    
    
    8.47
    
    
    
    7.34Tier I capital to risk-weighted assets (4) (13)
    
    
    13.28
    
    
    
    13.01
    
    
    
    9.71
    
    
    
    12.25
    
    
    
    12.95Total capital to risk-weighted assets (4) (13)
    
    
    14.55
    
    
    
    14.26
    
    
    
    10.97
    
    
    
    13.50
    
    
    
    14.21Leverage ratio (4) (13)
    
    
    12.42
    
    
    
    13.06
    
    
    
    10.23
    
    
    
    10.91
    
    
    
    10.24
 
 (1)
    
    Gain on sales includes $1.2 million gain due to the redemption of certain VISA USA common
shares in 2008 and a $1.9 million gain on a partial disposition of an equity security in 2007.
Please see Note 19 to the Consolidated Financial Statements.(2)
    
    Noninterest income in 2009 includes $3.3 million resulting from the gain on
acquisition related to the FDIC-assisted acquisition. Please see Note 2 to the
Consolidated Financial Statements.(3)
    
    Noninterest expenses in 2007 include $3.3 million resulting from the ATM-related
write-off and associated legal fees and $713,000 in litigation and settlement costs
related to VISA USA. Please see Note 19 to the Consolidated Financial Statements.(4)
    
    At period end.(5)
    
    Net of unearned discounts but before deduction of allowance for loan losses.(6)
    
    Total loans include loans held for sale.(7)
    
    These loans are covered by the FDIC loss share agreements, including the amount of
expected reimbursements from the FDIC, and are shown net of unearned discounts.
Please see Note 2 to the Consolidated Financial Statements.(8)
    
    Reflects the issuance of preferred stock in 2008 and the common stock offering and
repurchases of common shares in 2005. Please see Capital Resources on page 22 and
Note 11 to the Consolidated Financial Statements.(9)
    
    The efficiency ratio = noninterest expenses / (net interest income + total
noninterest income) as shown on the Consolidated Statements of Operations.(10)
    
    Ratio = average assets for year divided by the number of full-time equivalent
employees at year-end.(11)
    
    Nonperforming loans consist of nonaccrual loans, loans contractually past due 90 days
or more, and loans with restructured terms.(12)
    
    Nonperforming assets consist of nonperforming loans and other real estate owned.(13)
    
    2008 reflects the effects of capital raised through the sale of securities. Please
see Notes 9 and 11 to the Consolidated Financial Statements. 2




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SECURITIES LISTING, PRICES, AND DIVIDENDS
 Stock Listing
   Transfer Agents and Registrars
 For Southwest Bancorp, Inc.:
    
    For Southwest Capital Trust II:Computershare Investor Services, LLC
    
    U.S. Bank Trust National Association2 North LaSalle St.
    
    300 East Delaware AvenueChicago, IL 60602
    
    Wilmington, DE 19801
 Recent Stock Prices, Dividends, and Equity Compensation Plan Information
     2009
    
    2008Dividend
    
    
    
    
    
    
    
    
    
    DividendHigh
    
    Low
    
    Declared
    
    High
    
    Low
    
    DeclaredFor the Quarter Ending:March 31
    
    $
    12.51
    
    
    $
    5.48
    
    
    $
    0.0238
    
    
    $
    18.52
    
    
    $
    14.08
    
    
    $
    0.0950June 30
    
    
    10.50
    
    
    
    6.47
    
    
    
    0.0238
    
    
    
    18.29
    
    
    
    11.49
    
    
    
    0.0950September 30
    
    
    14.70
    
    
    
    8.71
    
    
    
    0.0238
    
    
    
    23.53
    
    
    
    9.83
    
    
    
    0.0950December 31
    
    
    14.00
    
    
    
    6.12
    
    
    
    0.0238
    
    
    
    19.55
    
    
    
    11.16
    
    
    
    0.0950
 3




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12/31/04
    
    
    12/31/05
    
    
    12/31/06
    
    
    12/31/07
    
    
    12/31/08
    
    
    12/31/09Southwest
    
    
    $
    100
    
    
    
    $
    83
    
    
    
    $
    117
    
    
    
    $
    78
    
    
    
    $
    57
    
    
    
    $
    31NASDAQ Bank Index
    
    
    
    100
    
    
    
    
    98
    
    
    
    
    110
    
    
    
    
    87
    
    
    
    
    63
    
    
    
    
    53NASDAQ Stock Market Index (U.S.)
    
    
    
    100
    
    
    
    
    102
    
    
    
    
    112
    
    
    
    
    122
    
    
    
    
    59
    
    
    
    
    84
  Equity Compensation Plan Information
 Number of securitiesNumber of securities
    
    
    
    
    
    available for futureto be issued upon
    
    Weighted average
    
    issuance under equityexercise of
    
    exercise price of
    
    compensation plansoutstanding options
    
    outstanding options,
    
    excluding securitieswarrants and rights
    
    warrants and rights
    
    reflected in column (a)Plan category
    
    (a)
    
    (b)
    
    (c)Plans approved by shareholders
    
    
    379,324
    
    
    $
    20.98
    
    
    
    773,600Plans not approved by
shareholders
    
    
    0
    
    
    
    0
    
    
    
    0Total
    
    
    379,324
    
    
    $
    20.98
    
    
    
    773,600
 4




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##### Table of Contents



MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
 Overview
  
    
    Net income available to common shareholders for 2009 was $8.8 million, down from $14.7
million in 2008 and from $21.4 million in 2007.
    
    Diluted earnings per common share decreased to $0.60 in 2009, compared to $1.00 in 2008
and $1.46 in 2007.
    
    Total loans grew to $2.67 billion at December 31, 2009, compared to $2.55 billion at
December 31, 2008 and $2.21 billion at December 31, 2007.
    
    Total deposits grew to $2.59 billion at December 31, 2009, compared to $2.18 billion at
December 31, 2008 and $2.06 billion at December 31, 2007.
    
    Total shareholders equity at year-end 2009 increased 3% to $309.8 million, compared to
$302.2 million for 2008 and $217.6 million for 2007.
    
    Total assets at year-end 2009 increased 8%, ending the year at $3.11 billion, compared
to $2.88 billion at year-end 2008 and $2.56 billion at year-end 2007.
    
    Portfolio loans at year-end 2009 increased by $130.2 million, or 5%, to $2.62 billion at
December 31, 2009, compared to $2.49 billion at December 31, 2008 and $2.15 billion at
December 31, 2007.
    
    
    An emphasis on prudent lending in carefully selected markets in Texas, Oklahoma, and
Kansas.We reduced our growth rate in portfolio loans to 5% in 2009, of which 3% is
attributable to the FDIC-assisted transaction. At year-end, Texas and Kansas together
accounted for over half of portfolio loans. Southwest has had a traditional focus on
commercial real estate loans. We will continue to make commercial real estate loans, but
have determined to reduce our concentration in them in light of economic conditions.
 5




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##### Table of Contents




    
    A focus on capital to support lending and other activities.At December 31, 2009, our
capital levels substantially exceed all regulatory capital requirements and the amounts
necessary to qualify as well capitalized for regulatory purposes. Please see Note 13
Capital Requirements & Regulatory Matters to the consolidated financial statements on page
61.
 Results of Operations
     6




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##### Table of Contents



Summary of Annual Changes in Selected Consolidated Financial Data
  2009 Change
    
    
    
    
    
    2008 Change
    
    
    
    
    
    2007 Change(Dollars in thousands, except per share data)
    
    2009
    
    From 2008
    
    2008
    
    From 2007
    
    2007
    
    From 2006Operations DataInterest income
    
    $
    150,399
    
    
    $
    (12,395
    )
    
    $
    162,794
    
    
    $
    (14,274
    )
    
    $
    177,068
    
    
    $
    7,308Interest expense
    
    
    51,708
    
    
    
    (21,367
    )
    
    
    73,075
    
    
    
    (11,396
    )
    
    
    84,471
    
    
    
    7,663Net interest income
    
    
    98,691
    
    
    
    8,972
    
    
    
    89,719
    
    
    
    (2,878
    )
    
    
    92,597
    
    
    
    (355
    )Provision for loan losses
    
    
    39,176
    
    
    
    20,197
    
    
    
    18,979
    
    
    
    10,032
    
    
    
    8,947
    
    
    
    (3,240
    )Gain on sales of loans and securities, net
    
    
    5,888
    
    
    
    2,322
    
    
    
    3,566
    
    
    
    (1,357
    )
    
    
    4,923
    
    
    
    1,234Noninterest income
    
    
    16,048
    
    
    
    3,476
    
    
    
    12,572
    
    
    
    1,062
    
    
    
    11,510
    
    
    
    (1,463
    )Noninterest expense
    
    
    60,858
    
    
    
    (1,630
    )
    
    
    62,488
    
    
    
    (2,620
    )
    
    
    65,108
    
    
    
    9,087Income before taxes
    
    
    20,593
    
    
    
    (3,797
    )
    
    
    24,390
    
    
    
    (10,585
    )
    
    
    34,975
    
    
    
    (6,431
    )Taxes on income
    
    
    7,611
    
    
    
    (1,878
    )
    
    
    9,489
    
    
    
    (4,108
    )
    
    
    13,597
    
    
    
    (1,812
    )Net income
    
    $
    12,982
    
    
    $
    (1,919
    )
    
    $
    14,901
    
    
    $
    (6,477
    )
    
    $
    21,378
    
    
    $
    (4,619
    )Net income available to common shareholders
    
    $
    8,837
    
    
    $
    (5,821
    )
    
    $
    14,658
    
    
    $
    (6,720
    )
    
    $
    21,378
    
    
    $
    (4,619
    )Per Share DataBasic earnings per common share
    
    $
    0.60
    
    
    $
    (0.41
    )
    
    $
    1.01
    
    
    $
    (0.48
    )
    
    $
    1.49
    
    
    $
    (0.35
    )Diluted earnings per common share
    
    
    0.60
    
    
    
    (0.40
    )
    
    
    1.00
    
    
    
    (0.46
    )
    
    
    1.46
    
    
    
    (0.33
    )Financial Condition Data  AveragesInvestment securities
    
    $
    245,456
    
    
    $
    6,803
    
    
    $
    238,653
    
    
    $
    (38,610
    )
    
    $
    277,263
    
    
    $
    6,241Total loans
    
    
    2,667,771
    
    
    
    238,642
    
    
    
    2,429,129
    
    
    
    506,262
    
    
    
    1,922,867
    
    
    
    91,871Interest-earning assets
    
    
    2,919,040
    
    
    
    247,404
    
    
    
    2,671,636
    
    
    
    466,370
    
    
    
    2,205,266
    
    
    
    99,906Total assets
    
    
    2,987,470
    
    
    
    244,571
    
    
    
    2,742,899
    
    
    
    463,474
    
    
    
    2,279,425
    
    
    
    84,330Interest-bearing deposits
    
    
    2,108,844
    
    
    
    227,759
    
    
    
    1,881,085
    
    
    
    285,719
    
    
    
    1,595,366
    
    
    
    97,233Total deposits
    
    
    2,394,028
    
    
    
    244,173
    
    
    
    2,149,855
    
    
    
    310,030
    
    
    
    1,839,825
    
    
    
    112,012Other borrowings
    
    
    181,682
    
    
    
    (92,424
    )
    
    
    274,106
    
    
    
    112,422
    
    
    
    161,684
    
    
    
    (52,993
    )Subordinated debentures
    
    
    81,963
    
    
    
    17,899
    
    
    
    64,064
    
    
    
    17,671
    
    
    
    46,393
    
    
    
    Total shareholders equity
    
    
    308,952
    
    
    
    76,121
    
    
    
    232,831
    
    
    
    22,946
    
    
    
    209,885
    
    
    
    24,068Selected RatiosReturn on average assets
    
    
    0.43
    %
    
    
    (0.11
    )%
    
    
    0.54
    %
    
    
    (0.40
    )%
    
    
    0.94
    %
    
    
    (0.24
    )%Return on average total shareholders equity
    
    
    4.20
    
    
    
    (2.20
    )
    
    
    6.40
    
    
    
    (3.79
    )
    
    
    10.19
    
    
    
    (3.80
    )Return on average common equity
    
    
    3.65
    
    
    
    (2.79
    )
    
    
    6.44
    
    
    
    (3.75
    )
    
    
    10.19
    
    
    
    (3.80
    )Net interest margin
    
    
    3.38
    
    
    
    0.02
    
    
    
    3.36
    
    
    
    (0.84
    )
    
    
    4.20
    
    
    
    (0.22
    )Asset Quality RatiosNoncoveredAllowance for loan losses to portfolio loans
    
    
    2.46
    %
    
    
    0.87
    %
    
    
    1.59
    %
    
    
    0.21
    %
    
    
    1.38
    %
    
    
    (0.32
    )%Nonperforming loans to portfolio loans
    
    
    4.18
    
    
    
    1.62
    
    
    
    2.56
    
    
    
    1.18
    
    
    
    1.38
    
    
    
    (0.45
    )Allowance for loan losses to nonperforming
loans
    
    
    58.77
    
    
    
    (3.39
    )
    
    
    62.16
    
    
    
    (37.88
    )
    
    
    100.04
    
    
    
    7.07Nonperforming assets to portfolio loans and
other real estate owned
    
    
    4.87
    
    
    
    2.07
    
    
    
    2.80
    
    
    
    1.30
    
    
    
    1.50
    
    
    
    (0.45
    )Net loan charge-offs to average portfolio loans
    
    
    0.64
    
    
    
    0.28
    
    
    
    0.36
    
    
    
    0.01
    
    
    
    0.35
    
    
    
    (0.13
    )CoveredNonperforming loans to portfolio loans
    
    
    15.76
    
    
    
    15.76
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Nonperforming assets to portfolio loans and
other real estate owned
    
    
    20.19
    
    
    
    20.19
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
 7




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Net Interest Income
       8




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##### Table of Contents



Consolidated Average Balances, Yields and Rates
 For the Year Ended December 31,(Dollars in thousands)
    
    2009
    
    
    
    
    
    2008
    
    
    
    
    
    
    
    
    
    2007Average
    
    
    
    
    
    Yield/
    
    Average
    
    
    
    
    
    Yield/
    
    Average
    
    
    
    
    
    Yield/Balance
    
    Interest
    
    Rate(1)
    
    Balance
    
    Interest
    
    Rate (1)
    
    Balance
    
    Interest
    
    Rate (1)AssetsTotal loans and leases (3)
    
    $
    2,667,771
    
    
    $
    141,239
    
    
    
    5.29
    %
    
    $
    2,429,129
    
    
    $
    152,719
    
    
    
    6.29
    %
    
    $
    1,922,867
    
    
    $
    165,759
    
    
    
    8.62
    %Investment securities
    
    
    245,456
    
    
    
    9,146
    
    
    
    3.73
    
    
    
    238,653
    
    
    
    9,986
    
    
    
    4.18
    
    
    
    277,263
    
    
    
    11,055
    
    
    
    3.99Other interest-earning assets
    
    
    5,813
    
    
    
    14
    
    
    
    0.24
    
    
    
    3,854
    
    
    
    89
    
    
    
    2.31
    
    
    
    5,136
    
    
    
    254
    
    
    
    4.95Total interest-earning assets
    
    
    2,919,040
    
    
    
    150,399
    
    
    
    5.15
    
    
    
    2,671,636
    
    
    
    162,794
    
    
    
    6.09
    
    
    
    2,205,266
    
    
    
    177,068
    
    
    
    8.03Other assets
    
    
    68,430
    
    
    
    
    
    
    
    
    
    
    
    71,263
    
    
    
    
    
    
    
    
    
    
    
    74,159Total assets
    
    $
    2,987,470
    
    
    
    
    
    
    
    
    
    
    $
    2,742,899
    
    
    
    
    
    
    
    
    
    
    $
    2,279,425Liabilities and Shareholders EquityInterest-bearing demand deposits
    
    $
    83,813
    
    
    $
    476
    
    
    
    0.57
    %
    
    $
    75,950
    
    
    $
    584
    
    
    
    0.77
    %
    
    $
    62,038
    
    
    $
    355
    
    
    
    0.57
    %Money market accounts
    
    
    485,383
    
    
    
    4,954
    
    
    
    1.02
    
    
    
    538,148
    
    
    
    12,620
    
    
    
    2.35
    
    
    
    449,266
    
    
    
    19,664
    
    
    
    4.38Savings accounts
    
    
    21,010
    
    
    
    78
    
    
    
    0.37
    
    
    
    13,930
    
    
    
    69
    
    
    
    0.50
    
    
    
    12,274
    
    
    
    87
    
    
    
    0.71Time deposits
    
    
    1,518,638
    
    
    
    36,811
    
    
    
    2.42
    
    
    
    1,253,057
    
    
    
    47,749
    
    
    
    3.81
    
    
    
    1,071,788
    
    
    
    53,033
    
    
    
    4.95Total interest-bearing deposits
    
    
    2,108,844
    
    
    
    42,319
    
    
    
    2.01
    
    
    
    1,881,085
    
    
    
    61,022
    
    
    
    3.24
    
    
    
    1,595,366
    
    
    
    73,139
    
    
    
    4.58Other borrowings
    
    
    181,682
    
    
    
    4,049
    
    
    
    2.23
    
    
    
    274,106
    
    
    
    7,242
    
    
    
    2.64
    
    
    
    161,684
    
    
    
    7,555
    
    
    
    4.67Subordinated debentures
    
    
    81,963
    
    
    
    5,340
    
    
    
    6.52
    
    
    
    64,064
    
    
    
    4,811
    
    
    
    7.51
    
    
    
    46,393
    
    
    
    3,777
    
    
    
    8.14Total interest-bearing liabilities
    
    
    2,372,489
    
    
    
    51,708
    
    
    
    2.18
    
    
    
    2,219,255
    
    
    
    73,075
    
    
    
    3.29
    
    
    
    1,803,443
    
    
    
    84,471
    
    
    
    4.68Noninterest-bearing demand deposits
    
    
    285,184
    
    
    
    
    
    
    
    
    
    
    
    268,770
    
    
    
    
    
    
    
    
    
    
    
    244,459Other liabilities
    
    
    20,845
    
    
    
    
    
    
    
    
    
    
    
    22,043
    
    
    
    
    
    
    
    
    
    
    
    21,638Shareholders equity
    
    
    308,952
    
    
    
    
    
    
    
    
    
    
    
    232,831
    
    
    
    
    
    
    
    
    
    
    
    209,885Total liabilities and
shareholders equity
    
    $
    2,987,470
    
    
    
    
    
    
    
    
    
    
    $
    2,742,899
    
    
    
    
    
    
    
    
    
    
    $
    2,279,425Net interest income
    
    
    
    
    
    $
    98,691
    
    
    
    
    
    
    
    
    
    
    $
    89,719
    
    
    
    
    
    
    
    
    
    
    $
    92,597Interest rate spread
    
    
    
    
    
    
    
    
    
    
    2.97
    %
    
    
    
    
    
    
    
    
    
    
    2.80
    %
    
    
    
    
    
    
    
    
    
    
    3.35
    %Net interest margin (2)
    
    
    
    
    
    
    
    
    
    
    3.38
    %
    
    
    
    
    
    
    
    
    
    
    3.36
    %
    
    
    
    
    
    
    
    
    
    
    4.20
    %Ratio of average interest-
earning assets to average
interest-bearing liabilities
    
    
    
    
    
    
    
    
    
    
    123.04
    %
    
    
    
    
    
    
    
    
    
    
    120.38
    %
    
    
    
    
    
    
    
    
    
    
    122.28
    %
 (1)
    
    Yields, interest rate spreads, and net interest margins are calculated using income recorded in accordance with U.S. generally accepted accounting principles (GAAP) and are not shown on the
higher, non-GAAP tax-equivalent basis.(2)
    
    Net interest margin = net interest income / total average interest-earning assets.(3)
    
    Information regarding noncovered and covered loans for the period shown is not readily available.
  9




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Effect of Volume and Rate Changes on Net Interest Income
 2009 vs. 2008
    
    2008 vs. 2007Increase
    
    Due to Change
    
    Increase
    
    Due to ChangeOr
    
    In Average:
    
    Or
    
    In Average:(Dollars in thousands)
    
    (Decrease)
    
    Volume
    
    Rate
    
    (Decrease)
    
    Volume
    
    RateInterest earned on:Loans receivable (1) (2)
    
    $
    (11,480
    )
    
    $
    14,095
    
    
    $
    (25,575
    )
    
    $
    (13,040
    )
    
    $
    37,817
    
    
    $
    (50,857
    )Investment securities
    
    
    (840
    )
    
    
    278
    
    
    
    (1,118
    )
    
    
    (1,069
    )
    
    
    (1,596
    )
    
    
    527Other interest-earning assets
    
    
    (75
    )
    
    
    31
    
    
    
    (106
    )
    
    
    (165
    )
    
    
    (53
    )
    
    
    (112
    )Total interest income
    
    
    (12,395
    )
    
    
    14,203
    
    
    
    (26,598
    )
    
    
    (14,274
    )
    
    
    33,228
    
    
    
    (47,502
    )Interest paid on:Interest-bearing demand
    
    
    (108
    )
    
    
    56
    
    
    
    (164
    )
    
    
    229
    
    
    
    90
    
    
    
    139Money market accounts
    
    
    (7,666
    )
    
    
    (1,134
    )
    
    
    (6,532
    )
    
    
    (7,044
    )
    
    
    3,351
    
    
    
    (10,395
    )Savings accounts
    
    
    9
    
    
    
    29
    
    
    
    (20
    )
    
    
    (18
    )
    
    
    11
    
    
    
    (29
    )Time deposits
    
    
    (10,938
    )
    
    
    8,728
    
    
    
    (19,666
    )
    
    
    (5,284
    )
    
    
    8,095
    
    
    
    (13,379
    )Other borrowings
    
    
    (3,193
    )
    
    
    (2,181
    )
    
    
    (1,012
    )
    
    
    (313
    )
    
    
    3,848
    
    
    
    (4,161
    )Subordinated debentures
    
    
    529
    
    
    
    1,223
    
    
    
    (694
    )
    
    
    1,034
    
    
    
    1,346
    
    
    
    (312
    )Total interest expense
    
    
    (21,367
    )
    
    
    4,756
    
    
    
    (26,123
    )
    
    
    (11,396
    )
    
    
    16,948
    
    
    
    (28,344
    )Net interest income
    
    $
    8,972
    
    
    $
    9,447
    
    
    $
    (475
    )
    
    $
    (2,878
    )
    
    $
    16,280
    
    
    $
    (19,158
    )
 (1)
    
    Average balances include nonaccrual loans. Fees included in interest income on loans receivable are not considered material.
Interest on tax-exempt loans and securities is not shown on a tax-equivalent basis, because it is not considered material.
Changes in rate-volume (changes in rate multiplied by changes in volume) are allocated between changes in rate and changes
in volume in proportion to the relative contribution of each.(2)
    
    Information regarding noncovered and covered loans for the period shown is not readily available.
      Provision and Allowance for Loan Losses
  10




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11




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Allowance for Loan and Lease Losses
 At December 31,(Dollars in thousands)
    
    2009
    
    2008
    
    2007
    
    2006
    
    2005Real estate
mortgage - Commercial
    
    $
    26,670
    
    
    
    47
    %
    
    $
    13,200
    
    
    
    44
    %
    
    $
    10,126
    
    
    
    34
    %
    
    $
    9,641
    
    
    
    34
    %
    
    $
    8,186
    
    
    
    32
    %One to four family
residential
    
    
    2,454
    
    
    
    5
    
    
    
    1,332
    
    
    
    4
    
    
    
    693
    
    
    
    5
    
    
    
    492
    
    
    
    5
    
    
    
    584
    
    
    
    5Real estate construction
    
    
    22,241
    
    
    
    25
    
    
    
    12,795
    
    
    
    26
    
    
    
    5,649
    
    
    
    33
    
    
    
    1,790
    
    
    
    25
    
    
    
    1,547
    
    
    
    17Commercial
    
    
    10,052
    
    
    
    20
    
    
    
    11,401
    
    
    
    22
    
    
    
    10,369
    
    
    
    23
    
    
    
    12,321
    
    
    
    24
    
    
    
    10,922
    
    
    
    22Installment
and consumer - Guaranteed student loans
    
    
    
    
    
    
    1
    
    
    
    
    
    
    
    2
    
    
    
    31
    
    
    
    3
    
    
    
    90
    
    
    
    10
    
    
    
    189
    
    
    
    22Other
    
    
    996
    
    
    
    2
    
    
    
    1,045
    
    
    
    2
    
    
    
    804
    
    
    
    2
    
    
    
    536
    
    
    
    2
    
    
    
    311
    
    
    
    2Unallocated*
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,912
    
    
    
    
    
    
    
    2,423
    
    
    
    
    
    
    
    2,073
    
    
    
    Total
    
    $
    62,413
    
    
    
    100
    %
    
    $
    39,773
    
    
    
    100
    %
    
    $
    29,584
    
    
    
    100
    %
    
    $
    27,293
    
    
    
    100
    %
    
    $
    23,812
    
    
    
    100
    %
 
 *
    
    Under current methodology, allowance is allocated among respective loan types.
 12




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##### Table of Contents



Analysis of Loans and Leases
 For the Year Ended December 31,(Dollars in thousands)
    
    2009*
    
    2008
    
    2007
    
    2006
    
    2005Balance at beginning of period
    
    $
    39,773
    
    
    $
    29,584
    
    
    $
    27,293
    
    
    $
    23,812
    
    
    $
    18,991Loans charged-off:Commercial real estate
    
    
    3,622
    
    
    
    1,379
    
    
    
    1,540
    
    
    
    452
    
    
    
    2,531One-to-four family residential
    
    
    1,476
    
    
    
    746
    
    
    
    337
    
    
    
    256
    
    
    
    341Real estate construction
    
    
    7,464
    
    
    
    2,209
    
    
    
    129
    
    
    
    445
    
    
    
    155Commercial
    
    
    5,223
    
    
    
    4,552
    
    
    
    4,663
    
    
    
    7,606
    
    
    
    8,639Other consumer
    
    
    1,128
    
    
    
    1,056
    
    
    
    696
    
    
    
    788
    
    
    
    724Total charge-offs
    
    
    18,913
    
    
    
    9,942
    
    
    
    7,365
    
    
    
    9,547
    
    
    
    12,390Recoveries:Commercial real estate
    
    
    438
    
    
    
    8
    
    
    
    22
    
    
    
    387
    
    
    
    15One-to-four family residential
    
    
    430
    
    
    
    49
    
    
    
    10
    
    
    
    27
    
    
    
    171Real estate construction
    
    
    344
    
    
    
    2
    
    
    
    
    
    
    
    
    
    
    
    1Commercial
    
    
    893
    
    
    
    962
    
    
    
    606
    
    
    
    403
    
    
    
    706Other consumer
    
    
    272
    
    
    
    131
    
    
    
    71
    
    
    
    24
    
    
    
    163Total recoveries
    
    
    2,377
    
    
    
    1,152
    
    
    
    709
    
    
    
    841
    
    
    
    1,056Net loans charged-off (recovered)
    
    
    16,536
    
    
    
    8,790
    
    
    
    6,656
    
    
    
    8,706
    
    
    
    11,334Provision for loan losses
    
    
    39,176
    
    
    
    18,979
    
    
    
    8,947
    
    
    
    12,187
    
    
    
    16,155Balance at end of period
    
    $
    62,413
    
    
    $
    39,773
    
    
    $
    29,584
    
    
    $
    27,293
    
    
    $
    23,812*     There was no significant amount of charge-offs or recoveries to covered loans in 2009.Ratio of allowance for loan losses to portfolio loans
at end of period
    
    
    2.46
    %
    
    
    1.59
    %
    
    
    1.38
    %
    
    
    1.70
    %
    
    
    1.76
    %Ratio of net charge-offs to average portfolio loans
during the period
    
    
    0.64
    %
    
    
    0.37
    %
    
    
    0.37
    %
    
    
    0.59
    %
    
    
    0.87
    %
 13




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##### Table of Contents



Nonperforming Assets
 At December 31,2009(Dollars in thousands)
    
    Noncovered
    
    Covered
    
    2008*
    
    2007*
    
    2006*
    
    2005*Nonaccrual loans:Commercial real estate
    
    $
    28,351
    
    
    $
    1,847
    
    
    $
    9,881
    
    
    $
    5,274
    
    
    $
    6,118
    
    
    $
    802One-to-four family residential
    
    
    9,387
    
    
    
    2,243
    
    
    
    474
    
    
    
    740
    
    
    
    484
    
    
    
    311Real estate construction
    
    
    57,586
    
    
    
    7,525
    
    
    
    37,346
    
    
    
    2,910
    
    
    
    3,398
    
    
    
    Commercial
    
    
    10,404
    
    
    
    665
    
    
    
    11,598
    
    
    
    10,517
    
    
    
    16,673
    
    
    
    20,891Other consumer
    
    
    159
    
    
    
    42
    
    
    
    11
    
    
    
    93
    
    
    
    62
    
    
    
    95Total nonaccrual loans
    
    
    105,887
    
    
    
    12,322
    
    
    
    59,310
    
    
    
    19,534
    
    
    
    26,735
    
    
    
    22,099Past due 90 days or more:Commercial real estate
    
    $
    100
    
    
    $
    542
    
    
    $
    9
    
    
    $
    8,214
    
    
    $
    1,133
    
    
    $
    One-to-four family residential
    
    
    76
    
    
    
    
    
    
    
    39
    
    
    
    74
    
    
    
    310
    
    
    
    637Real estate construction
    
    
    
    
    
    
    574
    
    
    
    4,005
    
    
    
    3
    
    
    
    556
    
    
    
    634Commercial
    
    
    18
    
    
    
    
    
    
    
    547
    
    
    
    1,456
    
    
    
    534
    
    
    
    215Other consumer
    
    
    116
    
    
    
    20
    
    
    
    73
    
    
    
    290
    
    
    
    89
    
    
    
    Total past due 90 days or more
    
    
    310
    
    
    
    1,136
    
    
    
    4,673
    
    
    
    10,037
    
    
    
    2,622
    
    
    
    1,486Total nonperforming loans
    
    
    106,197
    
    
    
    13,458
    
    
    
    63,983
    
    
    
    29,571
    
    
    
    29,357
    
    
    
    23,585Other real estate owned
    
    
    18,432
    
    
    
    4,748
    
    
    
    6,092
    
    
    
    2,679
    
    
    
    1,873
    
    
    
    7,130Total nonperforming assets
    
    $
    124,629
    
    
    $
    18,206
    
    
    $
    70,075
    
    
    $
    32,250
    
    
    $
    31,230
    
    
    $
    30,715*   There were no covered loans as of December 31, 2008, 2007, 2006, or 2005.Nonperforming assets to portfolio loans and
other real estate owned
    
    
    4.87
    %
    
    
    20.19
    %
    
    
    2.80
    %
    
    
    1.50
    %
    
    
    1.95
    %
    
    
    2.26
    %Nonperforming loans to portfolio loans
    
    
    4.18
    %
    
    
    15.76
    %
    
    
    2.56
    %
    
    
    1.38
    %
    
    
    1.83
    %
    
    
    1.74
    %Allowance for loan losses to
nonperforming loans
    
    
    58.77
    %
    
    
    
    
    
    
    62.16
    %
    
    
    100.04
    %
    
    
    92.97
    %
    
    
    100.96
    %Government-guaranteed portion of
nonperforming loans
    
    $
    277
    
    
    $
    3,853
    
    
    $
    1,072
    
    
    $
    1,337
    
    
    $
    1,629
    
    
    $
    1,602
    14




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##### Table of Contents



Noninterest Income
  COMPARISON SUMMARY-NONINTEREST INCOME
 2009 Change
    
    
    
    
    
    2008 Change(Dollars in thousands)
    
    2009
    
    From 2008
    
    2008
    
    From 2007
    
    2007Service charges and fees
    
    $
    11,704
    
    
    $
    678
    
    
    $
    11,026
    
    
    $
    1,106
    
    
    $
    9,920Other noninterest income
    
    
    4,344
    
    
    
    2,798
    
    
    
    1,546
    
    
    
    (44
    )
    
    
    1,590Gain on sales of loans
    
    
    2,963
    
    
    
    299
    
    
    
    2,664
    
    
    
    (675
    )
    
    
    3,339Gain on sales of investment
securities
    
    
    2,925
    
    
    
    2,023
    
    
    
    902
    
    
    
    (682
    )
    
    
    1,584Total noninterest income
    
    $
    21,936
    
    
    $
    5,798
    
    
    $
    16,138
    
    
    $
    (295
    )
    
    $
    16,433
 Service charges and fees.
  Other noninterest income.
 Gain on sales of loans
 Gain on sales of investment securities.
 Noninterest expense
  15




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##### Table of Contents



COMPARISON SUMMARY-NONINTEREST EXPENSE
 2009 Change
    
    
    
    
    
    2008 Change(Dollars in thousands)
    
    2009
    
    From 2008
    
    2008
    
    From 2007
    
    2007Salaries and employee benefits
    
    $
    29,299
    
    
    $
    (4,031
    )
    
    $
    33,330
    
    
    $
    (1,957
    )
    
    $
    35,287Occupancy
    
    
    11,637
    
    
    
    765
    
    
    
    10,872
    
    
    
    1,027
    
    
    
    9,845FDIC and other insurance
    
    
    5,545
    
    
    
    3,457
    
    
    
    2,088
    
    
    
    1,466
    
    
    
    622Other real estate, net
    
    
    130
    
    
    
    (16
    )
    
    
    146
    
    
    
    204
    
    
    
    (58
    )Provision for unfunded loan
commitments
    
    
    (230
    )
    
    
    (865
    )
    
    
    635
    
    
    
    (494
    )
    
    
    1,129Other general and administrative
    
    
    14,477
    
    
    
    (940
    )
    
    
    15,417
    
    
    
    (2,866
    )
    
    
    18,283Total noninterest expense
    
    $
    60,858
    
    
    $
    (1,630
    )
    
    $
    62,488
    
    
    $
    (2,620
    )
    
    $
    65,108
 Salaries and employee benefits.
  Occupancy expense.
  FDIC and other insurance.
    16




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##### Table of Contents



Other real estate, net.
 Provision for unfunded loan commitments.
 Other general and administrative.
 17




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##### Table of Contents



Operating Segments
 CONTRIBUTION OF OPERATING SEGMENTS
    
    FOR THE YEAR ENDED DECEMBER 31,(Dollars in thousands)
    
    2009
    
    2008
    
    2007Oklahoma banking
    
    $
    12,160
    
    
    $
    12,505
    
    
    $
    15,937Texas banking
    
    
    10,722
    
    
    
    7,551
    
    
    
    6,550Kansas banking
    
    
    424
    
    
    
    (1,122
    )
    
    
    859Other states banking
    
    
    (1,618
    )
    
    
    2,756
    
    
    
    2,163Secondary market
    
    
    (148
    )
    
    
    (144
    )
    
    
    1,097Other operations
    
    
    (8,558
    )
    
    
    (6,645
    )
    
    
    (5,228
    )Consolidated net income
    
    $
    12,982
    
    
    $
    14,901
    
    
    $
    21,378Oklahoma banking
    
    $
    933,150
    
    
    $
    966,243
    
    
    $
    876,085Texas banking
    
    
    1,054,404
    
    
    
    947,603
    
    
    
    759,389Kansas banking
    
    
    359,633
    
    
    
    304,855
    
    
    
    282,846Other states banking
    
    
    277,512
    
    
    
    275,805
    
    
    
    227,237Secondary market
    
    
    43,134
    
    
    
    56,941
    
    
    
    66,275Consolidated total loans
    
    $
    2,667,833
    
    
    $
    2,551,447
    
    
    $
    2,211,832Oklahoma banking
    
    $
    950,355
    
    
    $
    984,298
    
    
    $
    883,156Texas banking
    
    
    1,044,324
    
    
    
    945,907
    
    
    
    759,837Kansas banking
    
    
    441,114
    
    
    
    310,503
    
    
    
    294,927Other states banking
    
    
    275,653
    
    
    
    272,599
    
    
    
    230,109Secondary market
    
    
    45,148
    
    
    
    61,149
    
    
    
    71,843Other operations
    
    
    351,697
    
    
    
    305,306
    
    
    
    324,426Consolidated total assets
    
    $
    3,108,291
    
    
    $
    2,879,762
    
    
    $
    2,564,298Oklahoma banking
    
    $
    1,640,839
    
    
    $
    1,394,008
    
    
    $
    1,278,954Texas banking
    
    
    160,064
    
    
    
    133,745
    
    
    
    127,053Kansas banking
    
    
    283,506
    
    
    
    146,182
    
    
    
    120,754Secondary market
    
    
    1,527
    
    
    
    1,550
    
    
    
    1,346Other operations
    
    
    506,794
    
    
    
    504,637
    
    
    
    530,472Consolidated total deposits
    
    $
    2,592,730
    
    
    $
    2,180,122
    
    
    $
    2,058,579
     18




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##### Table of Contents



Taxes on Income
  19




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##### Table of Contents



Financial Condition
    Analysis of Securities
 At December 31,(Dollars in thousands)
    
    2009
    
    2008
    
    2007U.S. Government obligations
    
    $
    1,100
    
    
    $
    999
    
    
    $
    1,000Federal agency securities
    
    
    75,385
    
    
    
    79,197
    
    
    
    189,127Obligations of states and political subdivisions
    
    
    7,523
    
    
    
    10,098
    
    
    
    9,171Residential mortgage-backed securities
    
    
    159,146
    
    
    
    154,013
    
    
    
    38,347Other investments
    
    
    20,285
    
    
    
    19,859
    
    
    
    18,963Total investment securities
    
    $
    263,439
    
    
    $
    264,166
    
    
    $
    256,608Available for sale (fair value)
    
    $
    237,703
    
    
    $
    238,037
    
    
    $
    233,531Held to maturity (amortized cost)
    
    
    6,670
    
    
    
    7,343
    
    
    
    5,838Other investments (cost)
    
    
    19,066
    
    
    
    18,786
    
    
    
    17,239Total investment securities
    
    $
    263,439
    
    
    $
    264,166
    
    
    $
    256,608
   20




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##### Table of Contents



Maturity Table for Investment Securities
 After One
    
    
    After FiveOne Year
    
    
    Year through
    
    
    Years through
    
    
    After
    
    
    Total Investmentor Less
    
    
    Five Years
    
    
    Ten Years
    
    
    Ten Years
    
    
    Securities(Dollars in thousands)
    
    Cost
    
    
    Yield
    
    
    Cost
    
    
    Yield
    
    
    Cost
    
    
    Yield
    
    
    Cost
    
    
    Yield
    
    
    Cost
    
    
    Market
    
    
    YieldHeld to Maturity:Obligations of states and
political subdivisions
    
    $
    2,825
    
    
    
    3.54
    %
    
    $
    3,845
    
    
    
    3.12
    %
    
    $
    
    
    
    
    
    %
    
    $
    
    
    
    
    
    %
    
    $
    6,670
    
    
    $
    6,754
    
    
    
    3.30
    %Total
    
    $
    2,825
    
    
    
    3.54
    %
    
    $
    3,845
    
    
    
    3.12
    %
    
    $
    
    
    
    
    
    %
    
    $
    
    
    
    
    
    %
    
    $
    6,670
    
    
    $
    6,754
    
    
    
    3.30
    %Available for Sale:U.S. government
obligations
    
    $
    
    
    
    
    
    %
    
    $
    1,098
    
    
    
    1.20
    %
    
    $
    
    
    
    
    
    %
    
    $
    
    
    
    
    
    %
    
    $
    1,098
    
    
    $
    1,100
    
    
    
    1.20
    %Federal agency securities
    
    
    2,857
    
    
    
    1.34
    %
    
    
    20,184
    
    
    
    2.72
    %
    
    
    39,670
    
    
    
    3.36
    %
    
    
    13,078
    
    
    
    4.19
    %
    
    
    75,789
    
    
    
    75,385
    
    
    
    3.26
    %Obligations of states and
political subdivisions
    
    
    601
    
    
    
    3.99
    %
    
    
    181
    
    
    
    3.77
    %
    
    
    
    
    
    
    
    %
    
    
    55
    
    
    
    6.72
    %
    
    
    837
    
    
    
    853
    
    
    
    4.12
    %Residential mortgage-backed
securities
    
    
    13,838
    
    
    
    3.56
    %
    
    
    99,247
    
    
    
    3.44
    %
    
    
    38,161
    
    
    
    2.93
    %
    
    
    6,293
    
    
    
    4.37
    %
    
    
    157,539
    
    
    
    159,146
    
    
    
    3.37
    %Other securities
    
    
    
    
    
    
    
    %
    
    
    20,002
    
    
    
    
    %
    
    
    
    
    
    
    
    %
    
    
    
    
    
    
    
    %
    
    
    20,002
    
    
    
    20,285
    
    
    
    0.00
    %Total
    
    $
    17,296
    
    
    
    3.21
    %
    
    $
    140,712
    
    
    
    2.83
    %
    
    $
    77,831
    
    
    
    3.15
    %
    
    $
    19,426
    
    
    
    4.26
    %
    
    $
    255,265
    
    
    $
    256,769
    
    
    
    3.06
    %Total
    
    $
    20,121
    
    
    
    
    
    
    $
    144,557
    
    
    
    
    
    
    $
    77,831
    
    
    
    
    
    
    $
    19,426
    
    
    
    
    
    
    $
    261,935
    
    
    $
    263,523
  Analysis of Loans
   21




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##### Table of Contents



Trends in the Composition of the Loan Portfolio
 At December 31,2009(Dollars in thousands)
    
    Noncovered
    
    Covered
    
    2008*
    
    2007*
    
    2006*
    
    2005*Real estate mortgage -
Commercial
    
    $
    1,212,409
    
    
    $
    39,836
    
    
    $
    1,118,828
    
    
    $
    750,047
    
    
    $
    609,271
    
    
    $
    563,074One to four family
residential
    
    
    114,614
    
    
    
    12,630
    
    
    
    113,665
    
    
    
    111,085
    
    
    
    91,441
    
    
    
    93,478Real estate construction -
Commercial
    
    
    618,078
    
    
    
    12,515
    
    
    
    579,795
    
    
    
    643,656
    
    
    
    384,072
    
    
    
    258,275One to four family
residential
    
    
    41,109
    
    
    
    5,324
    
    
    
    79,565
    
    
    
    81,273
    
    
    
    69,678
    
    
    
    41,069Commercial
    
    
    520,505
    
    
    
    13,412
    
    
    
    564,670
    
    
    
    521,501
    
    
    
    424,189
    
    
    
    374,101Installment and consumer -
Guaranteed student loans
    
    
    36,163
    
    
    
    
    
    
    
    54,057
    
    
    
    61,555
    
    
    
    181,458
    
    
    
    377,110Other
    
    
    39,550
    
    
    
    1,688
    
    
    
    40,867
    
    
    
    42,715
    
    
    
    31,081
    
    
    
    28,7732,582,428
    
    
    
    85,405
    
    
    
    2,551,447
    
    
    
    2,211,832
    
    
    
    1,791,190
    
    
    
    1,735,880Less: Allowance for loan
losses
    
    
    (62,413
    )
    
    
    
    
    
    
    (39,773
    )
    
    
    (29,584
    )
    
    
    (27,293
    )
    
    
    (23,812
    )Total loans, net
    
    $
    2,520,015
    
    
    $
    85,405
    
    
    $
    2,511,674
    
    
    $
    2,182,248
    
    
    $
    1,763,897
    
    
    $
    1,712,068
 
 *
    
    There were no covered loans as of December 31, 2008, 2007, 2006, or 2005.   Capital Resources
    22




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##### Table of Contents



Liquidity
   (Dollars in thousands)
    
    AmountThree months or less(1)
    
    $
    61,571Over three through six months(1)
    
    
    177,699Over six through 12 months(1)
    
    
    487,825Over 12 months
    
    
    277,344Total
    
    $
    1,004,439
 
 (1)
    
    The amount of certificates of deposit of $100,000 and more that mature within 12 months
is $727.1 million. 23




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##### Table of Contents



Percentage of Total Average Assets2009
    
    2008
    
    2007Sources of Funds:Deposits:Noninterest-bearing demand
    
    
    9.55
    %
    
    
    9.80
    %
    
    
    10.72
    %Interest-bearing demand and money market accounts
    
    
    19.05
    
    
    
    22.39
    
    
    
    22.43Time and savings deposits
    
    
    51.54
    
    
    
    46.19
    
    
    
    47.56Other borrowings
    
    
    6.08
    
    
    
    9.99
    
    
    
    7.09Subordinated debentures
    
    
    2.74
    
    
    
    2.34
    
    
    
    2.04Other liabilities
    
    
    0.70
    
    
    
    0.80
    
    
    
    0.95Equity capital
    
    
    10.34
    
    
    
    8.49
    
    
    
    9.21Total
    
    
    100.00
    %
    
    
    100.00
    %
    
    
    100.00
    %Uses of Funds:Loans
    
    
    89.30
    %
    
    
    88.56
    %
    
    
    84.36
    %Investment securities
    
    
    8.22
    
    
    
    8.70
    
    
    
    12.15Other interest-earning assets
    
    
    0.19
    
    
    
    0.14
    
    
    
    0.22Noninterest-earning assets
    
    
    2.29
    
    
    
    2.60
    
    
    
    3.27Total
    
    
    100.00
    %
    
    
    100.00
    %
    
    
    100.00
    %
   Asset/Liability Management and Quantitative and Qualitative Disclosures about Market Risk
   24




---



##### Table of Contents



0 to 3
    
    4 to 12
    
    Over 1 to
    
    Over(Dollars in thousands)
    
    Months
    
    Months
    
    5 Years
    
    5 Years
    
    TotalRate-sensitive assets:Total loans
    
    $
    1,005,577
    
    
    $
    310,310
    
    
    $
    1,018,444
    
    
    $
    333,502
    
    
    $
    2,667,833Investment securities
    
    
    22,067
    
    
    
    4,527
    
    
    
    23,441
    
    
    
    213,404
    
    
    
    263,439Due from banks
    
    
    2,584
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,584Total
    
    
    1,030,228
    
    
    
    314,837
    
    
    
    1,041,885
    
    
    
    546,906
    
    
    
    2,933,856Rate-sensitive liabilities:Money market deposit accounts
    
    
    505,521
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    505,521Time deposits
    
    
    600,356
    
    
    
    928,962
    
    
    
    133,131
    
    
    
    
    
    
    
    1,662,449Savings accounts
    
    
    25,730
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    25,730Interest-bearing demand
    
    
    74,201
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    74,201Other borrowings
    
    
    34,522
    
    
    
    12,000
    
    
    
    31,500
    
    
    
    25,000
    
    
    
    103,022Subordinated debentures
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    81,963
    
    
    
    81,963Total
    
    
    1,240,330
    
    
    
    940,962
    
    
    
    164,631
    
    
    
    106,963
    
    
    
    2,452,886Interest sensitivity gap
    
    $
    (210,102
    )
    
    $
    (626,125
    )
    
    $
    877,254
    
    
    $
    439,943
    
    
    $
    480,970Cumulative interest sensitivity gap
    
    $
    (210,102
    )
    
    $
    (836,227
    )
    
    $
    41,027
    
    
    $
    480,970
    
    
    $
    480,970Percentage of rate-sensitive assets
to rate-sensitive liabilities
    
    
    83.06
    %
    
    
    33.46
    %
    
    
    632.86
    %
    
    
    511.30
    %
    
    
    119.61
    %Percentage of cumulative gap to
total assets
    
    
    (6.76
    )%
    
    
    (26.90
    )%
    
    
    1.32
    %
    
    
    15.47
    %
    
    
    15.47
    %
     25




---



##### Table of Contents



Estimated Changes in Net Interest Income
 Changes in Interest Rates:
    
    +300 bp
    
    +200 bp
    
    +100 bpPolicy Limit
    
    
    (18.00
    )%
    
    
    (10.00
    )%
    
    
    (5.00
    )%December 31, 2009
    
    
    1.98
    %
    
    
    (2.33
    )%
    
    
    (1.91
    )%December 31, 2008
    
    
    (2.26
    )%
    
    
    (4.08
    )%
    
    
    (3.81
    )%
   Estimated Changes in Economic Value of Equity (EVE)
 Changes in Interest Rates:
    
    +300 bp
    
    +200 bp
    
    + 100 bpPolicy Limit
    
    
    (35.00
    )%
    
    
    (20.00
    )%
    
    
    (10.00
    )%December 31, 2009
    
    
    (9.55
    )%
    
    
    (4.78
    )%
    
    
    (0.27
    )%December 31, 2008
    
    
    (8.48
    )%
    
    
    (4.03
    )%
    
    
    (0.82
    )%
  Off-Balance Sheet Arrangements
  26




---



##### Table of Contents



.
 Effects of Inflation
  Contractual Obligations
  Payments due by periodLess than
    
    1-3
    
    3-5
    
    Over(Dollars in thousands)
    
    1 Year
    
    Years
    
    Years
    
    5 Years
    
    TotalDeposits without stated maturity:(1)Noninterest bearing
    
    $
    324,829
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    324,829Interest bearing
    
    
    605,452
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    605,452Time deposits(2)
    
    
    1,542,315
    
    
    
    126,144
    
    
    
    12,149
    
    
    
    5
    
    
    
    1,680,613Other borrowings(2)
    
    
    34,002
    
    
    
    35,024
    
    
    
    2,644
    
    
    
    53,626
    
    
    
    125,296Subordinated debentures(2)
    
    
    2,872
    
    
    
    5,745
    
    
    
    5,745
    
    
    
    99,919
    
    
    
    114,281Operating leases
    
    
    2,655
    
    
    
    3,639
    
    
    
    1,991
    
    
    
    1,735
    
    
    
    10,020Total
    
    $
    2,512,125
    
    
    $
    170,552
    
    
    $
    22,529
    
    
    $
    155,285
    
    
    $
    2,860,491
 
 (1)
    
    Excludes interest.(2)
    
    Includes interest. Interest on variable rate obligations is shown at rates in effect at December 31, 2009. The contractual
amounts to be paid on variable rate obligations are affected by changes in market interest rates. Future changes in market
interest rates could materially affect the contractual amounts to be paid. Income Taxes
   Certain Regulatory Matters
  27




---



##### Table of Contents




    
    Establishing and ensuring compliance with a plan to reduce credit risk and
improve loan portfolio management;
    
    Eliminating credit weaknesses in nonperforming and potential problem loans;
    
    On-going review and grading of the Stillwater Nationals loan portfolio;
    
    Improving Stillwater Nationals position regarding nonperforming and
potential problem loans and other real estate owned;
    
    Improving loan portfolio concentration risk management; and
    
    Establishing and operating a loan workout department.
       Critical Accounting Policies
  28




---



##### Table of Contents



Loans Acquired through Transfer  Loan and Debt Securities Acquired with Deteriorated Credit Quality,
 Allowance for Loan Losses Contingencies Receivables: Subsequent Measurement
   Goodwill and Intangible Assets
 29




---



##### Table of Contents



Non-GAAP Financial Measures
  
 Controls and Procedures
 Disclosure Controls and Procedures
  Managements Report on Internal Control over Financial Reporting
   Fourth Quarter 2009 Changes in Internal Control over Financial Reporting
  30




---



##### Table of Contents



Report on Effectiveness of Internal Control over Financial Reporting
        
 31




---



##### Table of Contents



Reports of Independent Registered Public Accounting Firm
 Report on Consolidated Financial Statements
      
 32




---



##### Table of Contents



SOUTHWEST BANCORP, INC.
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
 AT DECEMBER 31,(Dollars in thousands)
    
    2009
    
    2008AssetsCash and cash equivalents
    
    $
    118,847
    
    
    $
    27,287Investment securities:Held to maturity, fair value $6,754 and $7,293, respectively
    
    
    6,670
    
    
    
    7,343Available for sale, amortized cost $236,199 and $233,293, respectively
    
    
    237,703
    
    
    
    238,037Other investments at cost
    
    
    19,066
    
    
    
    18,786Loans held for sale
    
    
    43,134
    
    
    
    56,941Noncovered loans receivable
    
    
    2,539,294
    
    
    
    2,494,506Less: Allowance for loan losses
    
    
    (62,413
    )
    
    
    (39,773
    )Net noncovered loans receivable
    
    
    2,476,881
    
    
    
    2,454,733Covered loans receivable (includes loss share receivable of $23.9 million)
    
    
    85,405
    
    
    
    Net loans receivable
    
    
    2,562,286
    
    
    
    2,454,733Accrued interest receivable
    
    
    10,806
    
    
    
    11,512Premises and equipment, net
    
    
    26,536
    
    
    
    24,580Noncovered other real estate
    
    
    18,432
    
    
    
    6,092Covered other real estate
    
    
    4,748
    
    
    
    Goodwill
    
    
    6,811
    
    
    
    7,071Other intangible assets, net
    
    
    5,779
    
    
    
    3,764Prepaid FDIC insurance premium
    
    
    14,581
    
    
    
    Other assets
    
    
    32,892
    
    
    
    23,616Total assets
    
    $
    3,108,291
    
    
    $
    2,879,762Liabilities & shareholders equityDeposits:Noninterest-bearing demand
    
    $
    324,829
    
    
    $
    261,940Interest-bearing demand
    
    
    74,201
    
    
    
    76,027Money market accounts
    
    
    505,521
    
    
    
    454,250Savings accounts
    
    
    25,730
    
    
    
    14,135Time deposits of $100,000 or more
    
    
    1,004,439
    
    
    
    802,244Other time deposits
    
    
    658,010
    
    
    
    571,526Total deposits
    
    
    2,592,730
    
    
    
    2,180,122Accrued interest payable
    
    
    3,191
    
    
    
    7,018Income tax payable
    
    
    4,486
    
    
    
    3,651Other liabilities
    
    
    13,121
    
    
    
    9,667Other borrowings
    
    
    103,022
    
    
    
    295,138Subordinated debentures
    
    
    81,963
    
    
    
    81,963Total liabilities
    
    
    2,798,513
    
    
    
    2,577,559Shareholders equity:Preferred stock, Series B  $1 par value; 1,000,000 shares
authorized; 70,000 shares issued
    
    
    67,037
    
    
    
    66,392Common stock  $1 par value; 20,000,000 shares authorized;
14,750,713 and 14,658,042 shares issued, respectively
    
    
    14,751
    
    
    
    14,658Paid in capital
    
    
    49,029
    
    
    
    49,101Retained earnings
    
    
    178,016
    
    
    
    170,579Accumulated other comprehensive gain
    
    
    945
    
    
    
    2,921Treasury stock, at cost; 0 and 80,383 shares, respectively
    
    
    
    
    
    
    (1,448
    )Total shareholders equity
    
    
    309,778
    
    
    
    302,203Total liabilities & shareholders equity
    
    $
    3,108,291
    
    
    $
    2,879,762
  33




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##### Table of Contents



SOUTHWEST BANCORP, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
 FOR THE YEAR ENDED DECEMBER 31,(Dollars in thousands, except per share data)
    
    2009
    
    2008
    
    2007Interest income:Interest and fees on loans
    
    $
    141,239
    
    
    $
    152,719
    
    
    $
    165,759Investment securities:U.S. Government and agency obligations
    
    
    1,960
    
    
    
    3,552
    
    
    
    8,506Mortgage-backed securities
    
    
    6,257
    
    
    
    5,514
    
    
    
    1,444State and political subdivisions
    
    
    299
    
    
    
    375
    
    
    
    260Other securities
    
    
    630
    
    
    
    545
    
    
    
    845Other interest-earning assets
    
    
    14
    
    
    
    89
    
    
    
    254Total interest income
    
    
    150,399
    
    
    
    162,794
    
    
    
    177,068Interest expense:Interest-bearing demand
    
    
    476
    
    
    
    584
    
    
    
    355Money market accounts
    
    
    4,954
    
    
    
    12,620
    
    
    
    19,664Savings accounts
    
    
    78
    
    
    
    69
    
    
    
    87Time deposits of $100,000 or more
    
    
    20,864
    
    
    
    28,214
    
    
    
    31,231Other time deposits
    
    
    15,947
    
    
    
    19,535
    
    
    
    21,802Other borrowings
    
    
    4,049
    
    
    
    7,242
    
    
    
    7,555Subordinated debentures
    
    
    5,340
    
    
    
    4,811
    
    
    
    3,777Total interest expense
    
    
    51,708
    
    
    
    73,075
    
    
    
    84,471Net interest income
    
    
    98,691
    
    
    
    89,719
    
    
    
    92,597Provision for loan losses
    
    
    39,176
    
    
    
    18,979
    
    
    
    8,947Net interest income after provision for loan losses
    
    
    59,515
    
    
    
    70,740
    
    
    
    83,650Noninterest income:Service charges and fees
    
    
    11,704
    
    
    
    11,026
    
    
    
    9,920Other noninterest income
    
    
    1,063
    
    
    
    1,546
    
    
    
    1,590Gain on acquisition
    
    
    3,281
    
    
    
    
    
    
    
    Gain on sales of loans
    
    
    2,963
    
    
    
    2,664
    
    
    
    3,339Gain on sale/call of investment securities
    
    
    2,925
    
    
    
    902
    
    
    
    1,584Total noninterest income
    
    
    21,936
    
    
    
    16,138
    
    
    
    16,433Noninterest expense:Salaries and employee benefits
    
    
    29,299
    
    
    
    33,330
    
    
    
    35,287Occupancy
    
    
    11,637
    
    
    
    10,872
    
    
    
    9,845FDIC and other insurance
    
    
    5,545
    
    
    
    2,088
    
    
    
    622Other real estate, net
    
    
    130
    
    
    
    146
    
    
    
    (58
    )General and administrative
    
    
    14,247
    
    
    
    16,052
    
    
    
    19,412Total noninterest expense
    
    
    60,858
    
    
    
    62,488
    
    
    
    65,108Income before taxes
    
    
    20,593
    
    
    
    24,390
    
    
    
    34,975Taxes on income
    
    
    7,611
    
    
    
    9,489
    
    
    
    13,597Net income
    
    $
    12,982
    
    
    $
    14,901
    
    
    $
    21,378Net income available to common shareholders
    
    $
    8,837
    
    
    $
    14,658
    
    
    $
    21,378Basic earnings per common share
    
    $
    0.60
    
    
    $
    1.01
    
    
    $
    1.49Diluted earnings per common share
    
    
    0.60
    
    
    
    1.00
    
    
    
    1.46Common dividends declared per share
    
    
    0.0952
    
    
    
    0.3800
    
    
    
    0.3700
  34




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##### Table of Contents



SOUTHWEST BANCORP, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
 FOR THE YEAR ENDED DECEMBER 31,(Dollars in thousands)
    
    2009
    
    2008
    
    2007Net income
    
    $
    12,982
    
    
    $
    14,901
    
    
    $
    21,378Other comprehensive income:Unrealized holding gain (loss) on available for sale securities
    
    
    (315
    )
    
    
    4,995
    
    
    
    5,073Reclassification adjustment for net gains realized during the
period
    
    
    (2,925
    )
    
    
    (902
    )
    
    
    (1,584
    )Other comprehensive income (loss), before tax
    
    
    (3,240
    )
    
    
    4,093
    
    
    
    3,489Tax benefit (expense) related to items of other comprehensive
income
    
    
    1,264
    
    
    
    (1,580
    )
    
    
    (1,343
    )Other comprehensive income (loss), net of tax
    
    
    (1,976
    )
    
    
    2,513
    
    
    
    2,146Comprehensive income
    
    $
    11,006
    
    
    $
    17,414
    
    
    $
    23,524
  35




---



##### Table of Contents



SOUTHWEST BANCORP, INC.
CONSOLIDATED STATEMENTS OF SHAREHOLDERS EQUITY
 Accumulated
    
    
    
    
    
    TotalOther
    
    
    
    
    
    Share-Preferred
    
    Common Stock
    
    Paid in
    
    Retained
    
    Comprehensive
    
    Treasury
    
    holdersStock
    
    Shares
    
    Amount
    
    Capital
    
    Earnings
    
    Income (Loss)
    
    Stock
    
    Equity(Dollars in thousands, except per share data)Balance, December 31, 2006
    
    
    
    
    
    
    14,658,042
    
    
    $
    14,658
    
    
    $
    45,901
    
    
    $
    146,197
    
    
    $
    (1,738
    )
    
    $
    (7,508
    )
    
    $
    197,510Cash dividends:Common, $0.37 per
share, and
other dividends
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (5,290
    )
    
    
    
    
    
    
    
    
    
    
    (5,290
    )Common stock issued:Employee Stock
Option Plan
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (782
    )
    
    
    
    
    
    
    
    
    
    
    1,707
    
    
    
    925Employee Stock
Purchase Plan
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    20
    
    
    
    
    
    
    
    
    
    
    
    76
    
    
    
    96Dividend
Reinvestment Plan
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    23
    
    
    
    
    
    
    
    
    
    
    
    71
    
    
    
    94Restricted Stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    108
    
    
    
    
    
    
    
    
    
    
    
    237
    
    
    
    345Adjustment related to adoption
of FIN 48
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (803
    )
    
    
    
    
    
    
    
    
    
    
    (803
    )Tax benefit related to exercise
of stock options
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    474
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    474Stock compensation expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    734
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    734Other comprehensive income,
net of tax
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,146
    
    
    
    
    
    
    
    2,146Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    21,378
    
    
    
    
    
    
    
    
    
    
    
    21,378Balance, December 31, 2007
    
    
    
    
    
    
    14,658,042
    
    
    
    14,658
    
    
    
    46,478
    
    
    
    161,482
    
    
    
    408
    
    
    
    (5,417
    )
    
    
    217,609Cash dividends:Preferred
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (243
    )
    
    
    
    
    
    
    
    
    
    
    (243
    )Common, $0.38 per
share, and
other dividends
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (5,517
    )
    
    
    
    
    
    
    
    
    
    
    (5,517
    )Preferred stock
    
    
    66,348
    
    
    
    
    
    
    
    
    
    
    
    3,652
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    70,000Warrant amortization
    
    
    44
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (44
    )
    
    
    
    
    
    
    
    
    
    
    Common stock issued:Employee Stock
Option Plan
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,554
    )
    
    
    
    
    
    
    
    
    
    
    3,489
    
    
    
    1,935Employee Stock
Purchase Plan
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (13
    )
    
    
    
    
    
    
    
    
    
    
    106
    
    
    
    93Dividend
Reinvestment Plan
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2
    )
    
    
    
    
    
    
    
    
    
    
    28
    
    
    
    26Restricted Stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (21
    )
    
    
    
    
    
    
    
    
    
    
    346
    
    
    
    325Tax benefit related to exercise
of stock options
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    339
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    339Stock compensation expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    222
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    222Other comprehensive income,
net of tax
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,513
    
    
    
    
    
    
    
    2,513Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    14,901
    
    
    
    
    
    
    
    
    
    
    
    14,901Balance, December 31, 2008
    
    $
    66,392
    
    
    
    14,658,042
    
    
    $
    14,658
    
    
    $
    49,101
    
    
    $
    170,579
    
    
    $
    2,921
    
    
    $
    (1,448
    )
    
    $
    302,203Cash dividends:Preferred
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3,500
    )
    
    
    
    
    
    
    
    
    
    
    (3,500
    )Common, $0.0952 per
share,
and other dividends
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,400
    )
    
    
    
    
    
    
    
    
    
    
    (1,400
    )Warrant amortization
    
    
    645
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (645
    )
    
    
    
    
    
    
    
    
    
    
    Common stock issued:Employee Stock
Option Plan
    
    
    
    
    
    
    89,705
    
    
    
    90
    
    
    
    (87
    )
    
    
    
    
    
    
    
    
    
    
    883
    
    
    
    886Employee Stock
Purchase Plan
    
    
    
    
    
    
    2,966
    
    
    
    3
    
    
    
    (21
    )
    
    
    
    
    
    
    
    
    
    
    102
    
    
    
    84Restricted Stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (240
    )
    
    
    
    
    
    
    
    
    
    
    463
    
    
    
    223Tax benefit related to exercise
of stock options
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    244
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    244Stock compensation expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    32
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    32Other comprehensive loss,
net of tax
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,976
    )
    
    
    
    
    
    
    (1,976
    )Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    12,982
    
    
    
    
    
    
    
    
    
    
    
    12,982Balance, December 31, 2009
    
    $
    67,037
    
    
    
    14,750,713
    
    
    $
    14,751
    
    
    $
    49,029
    
    
    $
    178,016
    
    
    $
    945
    
    
    $
    0
    
    
    $
    309,778
  36




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##### Table of Contents



SOUTHWEST BANCORP, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
 FOR THE YEAR ENDED DECEMBER 31,(Dollars in thousands)
    
    2008
    
    2008
    
    2007Operating activities:Net income
    
    $
    12,982
    
    
    $
    14,901
    
    
    $
    21,378Adjustments to reconcile net income to net cash provided by operating activities:Provision for loan losses
    
    
    39,176
    
    
    
    18,979
    
    
    
    8,947Deferred tax benefit
    
    
    (5,843
    )
    
    
    (2,788
    )
    
    
    (839
    )Asset depreciation
    
    
    3,187
    
    
    
    2,963
    
    
    
    2,812Securities premium amortization (discount
accretion), net
    
    
    1,718
    
    
    
    118
    
    
    
    (205
    )Amortization of intangibles
    
    
    1,650
    
    
    
    1,456
    
    
    
    646Stock based compensation
    
    
    321
    
    
    
    512
    
    
    
    959Net gain on sale/call of investment securities
    
    
    (2,925
    )
    
    
    (902
    )
    
    
    (1,584
    )Net gain on sales of available for sale loans
    
    
    (2,963
    )
    
    
    (2,664
    )
    
    
    (3,339
    )Net loss on sales of premises/equipment
    
    
    62
    
    
    
    258
    
    
    
    11Net gain on other real estate
    
    
    (636
    )
    
    
    (571
    )
    
    
    (11
    )Gain from FDIC assisted acquisition
    
    
    (3,281
    )
    
    
    
    
    
    
    Proceeds from sales of residential mortgage loans
    
    
    153,541
    
    
    
    63,479
    
    
    
    55,274Residential mortgage loans originated for resale
    
    
    (154,964
    )
    
    
    (61,195
    )
    
    
    (54,276
    )Proceeds from sales of student loans
    
    
    88,105
    
    
    
    104,946
    
    
    
    271,798Student loans originated for resale
    
    
    (69,817
    )
    
    
    (96,257
    )
    
    
    (149,629
    )Net changes in assets and liabilities:Accrued interest receivable
    
    
    706
    
    
    
    11,605
    
    
    
    1,396Other assets
    
    
    (17,097
    )
    
    
    (5,012
    )
    
    
    5,884Income taxes payable
    
    
    1,079
    
    
    
    2,217
    
    
    
    1,104Excess tax benefit from share-based payment arrangements
    
    
    (244
    )
    
    
    (339
    )
    
    
    (474
    )Accrued interest payable
    
    
    (3,827
    )
    
    
    (4,423
    )
    
    
    (2,159
    )Other liabilities
    
    
    3,518
    
    
    
    (1,424
    )
    
    
    51Net cash provided by operating activities
    
    
    44,448
    
    
    
    45,859
    
    
    
    157,744Investing activities:Proceeds from sales of available for sale securities
    
    
    123,458
    
    
    
    7,839
    
    
    
    10,204Proceeds from principal repayments, calls and maturities:Held to maturity securities
    
    
    1,675
    
    
    
    1,000
    
    
    
    Available for sale securities
    
    
    68,828
    
    
    
    193,958
    
    
    
    55,212Proceeds from redemptions of Federal Home Loan Bank stock
    
    
    1,081
    
    
    
    
    
    
    
    Purchases of other investments
    
    
    (1,361
    )
    
    
    (1,947
    )
    
    
    (801
    )Purchases of held to maturity securities
    
    
    
    
    
    
    (2,500
    )
    
    
    (4,202
    )Purchases of available for sale securities
    
    
    (174,343
    )
    
    
    (201,031
    )
    
    
    (22,096
    )Loans originated and principal repayments, net
    
    
    (50,572
    )
    
    
    (370,558
    )
    
    
    (505,335
    )Acquisitions, net, FDIC assisted (2009), Bank of Kansas (2007)
    
    
    17,161
    
    
    
    
    
    
    
    (4,057
    )Investment in subsidiary
    
    
    
    
    
    
    1,070
    
    
    
    Purchases of premises and equipment
    
    
    (5,245
    )
    
    
    (3,655
    )
    
    
    (3,287
    )Proceeds from sales of premises and equipment
    
    
    90
    
    
    
    219
    
    
    
    63Proceeds from sales of other real estate
    
    
    7,050
    
    
    
    11,595
    
    
    
    469Net cash used in investing activities
    
    
    (12,178
    )
    
    
    (364,010
    )
    
    
    (473,830
    )Financing activities:Net increase in deposits
    
    
    277,601
    
    
    
    121,543
    
    
    
    227,431Net increase (decrease) in other borrowings
    
    
    (213,788
    )
    
    
    76,782
    
    
    
    80,262Net proceeds from issuance of preferred stock
    
    
    
    
    
    
    70,000
    
    
    
    Net proceeds from issuance of common stock
    
    
    970
    
    
    
    2,054
    
    
    
    1,115Net proceeds from issuance of subordinated debentures
    
    
    
    
    
    
    34,500
    
    
    
    Excess tax benefit from share-based payment arrangements
    
    
    244
    
    
    
    339
    
    
    
    474Preferred stock dividends paid
    
    
    (3,305
    )
    
    
    (243
    )
    
    
    Common stock dividends paid
    
    
    (2,432
    )
    
    
    (5,215
    )
    
    
    (5,136
    )Net cash provided from financing activities
    
    
    59,290
    
    
    
    299,760
    
    
    
    304,146Net increase (decrease) in cash and cash equivalents
    
    
    91,560
    
    
    
    (18,391
    )
    
    
    (11,940
    )Cash and cash equivalents beginning of period
    
    
    27,287
    
    
    
    45,678
    
    
    
    57,618Cash and cash equivalents end of period
    
    $
    118,847
    
    
    $
    27,287
    
    
    $
    45,678
  37




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##### Table of Contents



SOUTHWEST BANCORP, INC.
 
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
 FOR THE YEARS ENDED DECEMBER 31, 2009, 2008, AND 2007
 1. Summary of Significant Accounting and Reporting Policies
 Organization and Nature of Operations
 Basis of Presentation
 Subsequent Events
 Management Estimates
 Cash and Cash Equivalents
 38




---



##### Table of Contents



Investment Securities
    Loans
    39




---



##### Table of Contents



Loans Acquired through Transfer - Loan and Debt
Securities Acquired with Deteriorated Credit Quality
 Loss Share Receivable
  Allowance for Loan Losses Receivables: Subsequent Measurement Contingencies
 40




---



##### Table of Contents



Reserve for Unfunded Loan Commitments -
 Premises and Equipment
 Other Real Estate Owned
 Goodwill and Other Intangible Assets Intangibles - Goodwill and Other Business Combinations. Transfers and Servicing
 41




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##### Table of Contents



Prepaid FDIC Insurance Premium
 Fair Value Measurements Fair Value Measurements and Disclosure
 Deposits
 Loan Servicing Income
 Taxes on Income
 42




---



##### Table of Contents



Earnings per Common Share
  Share-Based Compensation
  Comprehensive Income
 Trust
 Liquidity
 2. Acquisitions
  43




---



##### Table of Contents



(Dollars in thousands)
    
    AmountCash and cash equivalents
    
    $
    6,039Loans
    
    
    117,096Investment securities
    
    
    20,644Core deposit intangibles
    
    
    1,983Other real estate owned
    
    
    2,938Other assets
    
    
    1,141Total assets acquired
    
    $
    149,841Deposits
    
    
    135,007Borrowings
    
    
    21,672Other liabilities
    
    
    1,003Net assets acquired
    
    $
    (7,841
    )Plus: cash received from FDIC
    
    
    11,122Gain on acquisition
    
    $
    3,281
 Business Combinations,
   ASC 310.30(Dollars in thousands)
    
    Loans
    
    Other
    
    TotalCommercial real estate
    
    $
    30,186
    
    
    $
    
    
    
    $
    30,1861-4 family residential
    
    
    8,394
    
    
    
    
    
    
    
    8,394Real Estate Construction
    
    
    12,475
    
    
    
    
    
    
    
    12,475Commercial
    
    
    9,247
    
    
    
    
    
    
    
    9,247Consumer
    
    
    1,158
    
    
    
    
    
    
    
    1,158Other real estate owned
    
    
    
    
    
    
    4,748
    
    
    
    4,748Estimated loss reimbursement
from the FDIC
    
    
    23,945
    
    
    
    
    
    
    
    23,945Total covered assets
    
    $
    85,405
    
    
    $
    4,748
    
    
    $
    90,153
    44




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##### Table of Contents



2009Net
    
    Carryingaccretable
    
    amount(Dollars in thousands)
    
    amount
    
    of loansFair value of acquired loans at
beginning of period (or date of
acquisition)
    
    $
    3,743
    
    
    $
    117,096Payments received
    
    
    
    
    
    
    (32,240
    )Charge-offs
    
    
    (81
    )
    
    
    Amortization
    
    
    (588
    )
    
    
    549Balance at end of period
    
    $
    3,074
    
    
    $
    85,405
   45




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##### Table of Contents



3. Investment Securities
 Debt and Equity Securities
  At December 31, 2009Amortized
    
    Gross Unrealized
    
    Fair(Dollars in thousands)
    
    Cost
    
    Gains
    
    Losses
    
    ValueHeld to Maturity:Obligations of state and political subdivisions
    
    $
    6,670
    
    
    $
    84
    
    
    $
    
    
    
    $
    6,754Total
    
    $
    6,670
    
    
    $
    84
    
    
    $
    
    
    
    $
    6,754Available for Sale:U.S. Government obligations
    
    $
    1,098
    
    
    $
    2
    
    
    $
    
    
    
    $
    1,100Federal agency securities
    
    
    75,789
    
    
    
    445
    
    
    
    (849
    )
    
    
    75,385Obligations of state and political subdivisions
    
    
    837
    
    
    
    16
    
    
    
    
    
    
    
    853Residential mortgage-backed securities
    
    
    157,539
    
    
    
    2,241
    
    
    
    (634
    )
    
    
    159,146Equity securities
    
    
    936
    
    
    
    283
    
    
    
    
    
    
    
    1,219Total
    
    $
    236,199
    
    
    $
    2,987
    
    
    $
    (1,483
    )
    
    $
    237,703
 At December 31, 2008Amortized
    
    Gross Unrealized
    
    Fair(Dollars in thousands)
    
    Cost
    
    Gains
    
    Losses
    
    ValueHeld to Maturity:Obligations of state and political subdivisions
    
    $
    7,343
    
    
    $
    10
    
    
    $
    (60
    )
    
    $
    7,293Total
    
    $
    7,343
    
    
    $
    10
    
    
    $
    (60
    )
    
    $
    7,293Available for Sale:U.S. Government obligations
    
    $
    986
    
    
    $
    13
    
    
    $
    
    
    
    $
    999Federal agency securities
    
    
    77,543
    
    
    
    1,663
    
    
    
    (9
    )
    
    
    79,197Obligations of state and political subdivisions
    
    
    2,736
    
    
    
    19
    
    
    
    
    
    
    
    2,755Residential mortgage-backed securities
    
    
    151,130
    
    
    
    2,897
    
    
    
    (14
    )
    
    
    154,013Equity securities
    
    
    898
    
    
    
    175
    
    
    
    
    
    
    
    1,073Total
    
    $
    233,293
    
    
    $
    4,767
    
    
    $
    (23
    )
    
    $
    238,037
  46




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##### Table of Contents



Continuous Unrealized Losses Existing for:Amortized cost of
    
    
    
    
    
    
    
    
    
    Fair value ofNumber of
    
    securities with
    
    Less Than
    
    More Than
    
    securities with(Dollars in thousands)
    
    Securities
    
    unrealized losses
    
    12 Months
    
    12 Months
    
    unrealized lossesAt December 31, 2009:Available for Sale:Federal agency securities
    
    
    14
    
    
    $
    38,710
    
    
    $
    (849
    )
    
    $
    
    
    
    $
    37,861Obligations of state and political
subdivisions
    
    
    1
    
    
    
    55
    
    
    
    
    
    
    
    
    
    
    
    55Residential mortgage-backed securities
    
    
    20
    
    
    
    59,327
    
    
    
    (634
    )
    
    
    
    
    
    
    58,693Total
    
    
    35
    
    
    $
    98,092
    
    
    $
    (1,483
    )
    
    $
    
    
    
    $
    96,609At December 31, 2008:Held to Maturity:Obligations of state and political
subdivisions
    
    
    5
    
    
    $
    2,875
    
    
    $
    (60
    )
    
    $
    
    
    
    $
    2,815Total
    
    
    5
    
    
    $
    2,875
    
    
    $
    (60
    )
    
    $
    
    
    
    $
    2,815Available for Sale:Federal agency securities
    
    
    2
    
    
    $
    5,962
    
    
    $
    (9
    )
    
    $
    
    
    
    $
    5,953Obligations of state and political
subdivisions
    
    
    1
    
    
    
    1,250
    
    
    
    
    
    
    
    
    
    
    
    1,250Residential mortgage-backed securities
    
    
    8
    
    
    
    3,608
    
    
    
    (14
    )
    
    
    
    
    
    
    3,594Total
    
    
    11
    
    
    $
    10,820
    
    
    $
    (23
    )
    
    $
    
    
    
    $
    10,797
     47




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##### Table of Contents



Available for Sale
    
    Held to MaturityAmortized
    
    Fair
    
    Amortized
    
    Fair(Dollars in thousands)
    
    Cost
    
    Value
    
    Cost
    
    ValueOne year or less
    
    $
    17,296
    
    
    $
    17,539
    
    
    $
    2,825
    
    
    $
    2,853More than one year through five years
    
    
    121,646
    
    
    
    123,881
    
    
    
    3,845
    
    
    
    3,901More than five years through ten years
    
    
    77,831
    
    
    
    77,173
    
    
    
    
    
    
    
    More than ten years
    
    
    19,426
    
    
    
    19,110
    
    
    
    
    
    
    
    Total
    
    $
    236,199
    
    
    $
    237,703
    
    
    $
    6,670
    
    
    $
    6,754
   4. Loans
  At December 31,2009
    
    2008*(Dollars in thousands)
    
    Noncovered
    
    CoveredReal estate mortgage:Commercial
    
    $
    1,212,409
    
    
    $
    39,836
    
    
    $
    1,118,828One-to-four family residential
    
    
    114,614
    
    
    
    12,630
    
    
    
    113,665Real estate constructionCommercial
    
    
    618,078
    
    
    
    12,515
    
    
    
    579,795One-to-four family residential
    
    
    41,109
    
    
    
    5,324
    
    
    
    79,565Commercial
    
    
    520,505
    
    
    
    13,412
    
    
    
    564,670Installment and consumer:Guaranteed student loans
    
    
    36,163
    
    
    
    
    
    
    
    54,057Other
    
    
    39,550
    
    
    
    1,688
    
    
    
    40,8672,582,428
    
    
    
    85,405
    
    
    
    2,551,447Allowance for loan losses
    
    
    (62,413
    )
    
    
    
    
    
    
    (39,773
    )Total loans, net
    
    $
    2,520,015
    
    
    $
    85,405
    
    
    $
    2,511,674
 *
    
    There were no covered loans as of December 31, 2008.   48




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##### Table of Contents



49




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##### Table of Contents



After oneOne year
    
    year through
    
    After(Dollars in thousands)
    
    or less
    
    five years
    
    five years
    
    TotalNoncovered:Real estate mortgage:Commercial
    
    $
    232,021
    
    
    $
    801,680
    
    
    $
    178,708
    
    
    $
    1,212,409One-to-four family residential
    
    
    12,025
    
    
    
    53,205
    
    
    
    49,384
    
    
    
    114,614Real estate construction
    
    
    367,477
    
    
    
    270,879
    
    
    
    20,831
    
    
    
    659,187Commercial
    
    
    144,459
    
    
    
    211,424
    
    
    
    164,622
    
    
    
    520,505Installment and consumer:Guaranteed student loans
    
    
    36,163
    
    
    
    
    
    
    
    
    
    
    
    36,163Other
    
    
    16,111
    
    
    
    21,688
    
    
    
    1,751
    
    
    
    39,550Total  noncovered
    
    
    808,256
    
    
    
    1,358,876
    
    
    
    415,296
    
    
    
    2,582,428Covered:Real estate mortgage:Commercial
    
    
    2,162
    
    
    
    11,366
    
    
    
    26,308
    
    
    
    39,836One-to-four family residential
    
    
    3,293
    
    
    
    2,407
    
    
    
    6,930
    
    
    
    12,630Real estate construction
    
    
    15,420
    
    
    
    513
    
    
    
    1,906
    
    
    
    17,839Commercial
    
    
    6,592
    
    
    
    4,228
    
    
    
    2,592
    
    
    
    13,412Installment and consumer:
    
    
    253
    
    
    
    1,375
    
    
    
    60
    
    
    
    1,688Total  covered
    
    
    27,720
    
    
    
    19,889
    
    
    
    37,796
    
    
    
    85,405Total
    
    $
    835,976
    
    
    $
    1,378,765
    
    
    $
    453,092
    
    
    $
    2,667,833
  (Dollars in thousands)
    
    Fixed
    
    VariableNoncovered:Real estate mortgage:Commercial
    
    $
    333,438
    
    
    $
    646,950One-to-four family residential
    
    
    50,460
    
    
    
    52,129Real estate construction
    
    
    59,086
    
    
    
    232,624Commercial
    
    
    121,756
    
    
    
    254,290Installment and consumer
    
    
    9,546
    
    
    
    13,893Total  noncovered
    
    
    574,286
    
    
    
    1,199,886Covered:Real estate mortgage:Commercial
    
    
    5,794
    
    
    
    31,880One-to-four family residential
    
    
    1,939
    
    
    
    7,398Real estate construction
    
    
    550
    
    
    
    1,869Commercial
    
    
    2,674
    
    
    
    4,146Installment and consumer
    
    
    1,429
    
    
    
    6Total  covered
    
    
    12,386
    
    
    
    45,299Total
    
    $
    586,672
    
    
    $
    1,245,185
  For the Year Ended December 31,(Dollars in thousands)
    
    2009
    
    2008
    
    2007Beginning balance
    
    $
    39,773
    
    
    $
    29,584
    
    
    $
    27,293Provision for loan losses
    
    
    39,176
    
    
    
    18,979
    
    
    
    8,947Loans charged off
    
    
    (18,913
    )
    
    
    (9,942
    )
    
    
    (7,365
    )Recoveries
    
    
    2,377
    
    
    
    1,152
    
    
    
    709Total
    
    $
    62,413
    
    
    $
    39,773
    
    
    $
    29,584
  50




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##### Table of Contents



5. Premises and Equipment
  At December 31,(Dollars in thousands)
    
    2009
    
    2008Land
    
    $
    6,841
    
    
    $
    5,830Buildings and improvements
    
    
    17,872
    
    
    
    15,210Furniture, fixtures, and equipment
    
    
    32,463
    
    
    
    30,907Construction/Remodeling in progress
    
    
    139
    
    
    
    38057,315
    
    
    
    52,327Accumulated depreciation and amortization
    
    
    (30,779
    )
    
    
    (27,747
    )Premises and equipment, net
    
    $
    26,536
    
    
    $
    24,580
 6. Goodwill and Other Intangible Assets
    At December 31,(Dollars in thousands)
    
    2009
    
    2008Core deposit premiums
    
    $
    6,353
    
    
    $
    4,370Less accumulated amortization
    
    
    2,249
    
    
    
    1,774Core deposit premiums, net
    
    $
    4,104
    
    
    $
    2,596Loan servicing rights
    
    $
    6,687
    
    
    $
    5,004Less accumulated amortization
    
    
    5,012
    
    
    
    3,836Loan servicing rights, net
    
    $
    1,675
    
    
    $
    1,168Other intangible assets, net
    
    $
    5,779
    
    
    $
    3,764
   51




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##### Table of Contents



Core Deposit
    
    Loan Servicing(Dollars in thousands)
    
    Premiums
    
    Rights
    
    Total2010
    
    
    547
    
    
    
    637
    
    
    
    1,1842011
    
    
    527
    
    
    
    465
    
    
    
    9922012
    
    
    488
    
    
    
    317
    
    
    
    8052013
    
    
    484
    
    
    
    183
    
    
    
    667Thereafter
    
    
    2,058
    
    
    
    73
    
    
    
    2,131$
    4,104
    
    
    $
    1,675
    
    
    $
    5,779
 7. Fair Value Measurements
   Level 1
    
    Quoted prices in active markets for identical assets or
liabilities: Level 1 assets and liabilities include debt and
equity securities that are traded in an active exchange market, as
well as certain U.S. Treasury securities that are highly liquid
and are actively traded in over-the-counter markets.Level 2
    
    Observable inputs other than Level 1 prices, such as quoted prices
for similar assets or liabilities; quoted prices in markets that
are not active; or other inputs that are observable or can be
corroborated by observable market data for substantially the full
term of the assets or liabilities. Level 2 assets and liabilities
include debt securities with quoted prices that are traded less
frequently than exchange-traded instruments. This category
includes U.S. Government and agency mortgage-backed debt
securities, municipal obligation securities, loans held for sale,
and certain private equity investments.Level 3
    
    Unobservable inputs that are supported by little or no market
activity and that are significant to the fair value of the assets.
Level 3 assets include financial instruments whose values are
determined using pricing models, discounted cash flow
methodologies, or similar techniques, as well as instruments for
which the determination of fair value requires significant
management judgment or estimation. This category includes other
real estate owned, goodwill, and other intangible assets.
  52




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##### Table of Contents



Loans held for sale
 Available for sale securities
  Fair Value Measurement at December 31, 2009 UsingQuoted Prices inActive Markets for
    
    Significant Other
    
    SignificantIdentical Assets
    
    Observable Inputs
    
    Unobservable Inputs(Dollars in thousands)
    
    Total
    
    (Level 1)
    
    (Level 2)
    
    (Level 3)Loans held for sale
    
    $
    43,134
    
    
    $
    
    
    
    $
    43,134
    
    
    $
    Available for sale securities
    
    
    237,703
    
    
    
    1,241
    
    
    
    236,462
    
    
    
    Total
    
    $
    280,837
    
    
    $
    1,241
    
    
    $
    279,596
    
    
    $
    
  Impaired loans
 Other real estate owned
 Goodwill
 Core deposit premiums
 Mortgage loan servicing rights
 53




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##### Table of Contents



Fair
Value Measurements UsingQuoted Prices in
    
    
    
    SignificantYear ended
    
    Active Markets for
    
    Significant Other
    
    UnobservableDecember 31,
    
    Identical Assets
    
    Observable Inputs
    
    Inputs
    
    Total Gains(Dollars in thousands)
    
    2009
    
    (Level 1)
    
    (Level 2)
    
    (Level 3)
    
    (Losses)Acquired assets and liabilities:Investment securities
    
    $
    20,644
    
    
    $
    
    
    
    $
    20,644
    
    
    $
    
    
    
    $
    Loans
    
    
    117,096
    
    
    
    
    
    
    
    
    
    
    
    117,096
    
    
    
    Core deposit intangible
    
    
    1,983
    
    
    
    
    
    
    
    1,983
    
    
    
    
    
    
    
    Other real estate owned
    
    
    2,938
    
    
    
    
    
    
    
    
    
    
    
    2,938
    
    
    
    Deposits
    
    
    135,007
    
    
    
    
    
    
    
    
    
    
    
    135,007
    
    
    
    Borrowings
    
    
    21,672
    
    
    
    
    
    
    
    21672
    
    
    
    
    
    
    
    Noncovered impaired loans at fair value
    
    
    65,505
    
    
    
    
    
    
    
    65,505
    
    
    
    
    
    
    
    (14,006
    )Mortgage loan servicing rights
    
    
    1,850
    
    
    
    
    
    
    
    
    
    
    
    1,850
    
    
    
    (329
    )Total
    
    $
    366,695
    
    
    $
    
    
    
    $
    109,804
    
    
    $
    256,891
    
    
    $
    (14,335
    )
    Financial Instruments
 Cash and cash equivalents
 Investment securities
 Loans
 Accrued interest receivable
 Deposits
 Other borrowings
 54




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##### Table of Contents



Subordinated debentures
 Other liabilities and accrued interest payable
 Commitments
  At December 31, 2009
    
    At December 31, 2008Carrying
    
    Fair
    
    Carrying
    
    Fair(Dollars in thousands)
    
    Values
    
    Values
    
    Values
    
    ValuesCash and cash equivalents
    
    $
    118,847
    
    
    $
    118,847
    
    
    $
    27,287
    
    
    $
    27,287Investment securities:Held to maturity
    
    
    6,670
    
    
    
    6,754
    
    
    
    7,343
    
    
    
    7,293Available for sale
    
    
    237,703
    
    
    
    237,703
    
    
    
    238,037
    
    
    
    238,037Other investments
    
    
    19,066
    
    
    
    19,066
    
    
    
    18,786
    
    
    
    18,786Total loans
    
    
    2,605,420
    
    
    
    2,567,369
    
    
    
    2,511,674
    
    
    
    2,541,424Accrued interest receivable
    
    
    10,806
    
    
    
    10,806
    
    
    
    11,512
    
    
    
    11,512Deposits
    
    
    2,592,730
    
    
    
    2,583,691
    
    
    
    2,180,122
    
    
    
    2,190,988Accrued interest payable
    
    
    3,191
    
    
    
    3,191
    
    
    
    7,018
    
    
    
    7,018Other liabilities
    
    
    13,121
    
    
    
    13,121
    
    
    
    9,667
    
    
    
    9,667Other borrowings
    
    
    103,022
    
    
    
    103,527
    
    
    
    295,138
    
    
    
    298,175Subordinated debentures
    
    
    81,963
    
    
    
    83,343
    
    
    
    81,963
    
    
    
    82,653
 8. Other Borrowed Funds
  2009
    
    
    2008Balance at
    
    
    Average
    
    
    Weighted
    
    
    Balance at
    
    
    Average
    
    
    Weighted(Dollars in thousands)
    
    December 31,
    
    
    Balance
    
    
    Average Rate
    
    
    December 31,
    
    
    Balance
    
    
    Average RateFederal funds purchased
    
    $
    10,060
    
    
    $
    36,732
    
    
    
    0.20
    %
    
    $
    89,534
    
    
    $
    91,173
    
    
    
    2.25
    %Securities sold under repurchase
agreements
    
    
    23,259
    
    
    
    27,174
    
    
    
    0.32
    
    
    
    38,034
    
    
    
    33,718
    
    
    
    1.36Federal Home Loan Bank advances
    
    
    68,560
    
    
    
    103,510
    
    
    
    3.04
    
    
    
    151,500
    
    
    
    128,687
    
    
    
    3.13Federal Reserve Bank borrowings
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    7,650
    
    
    
    5.05Treasury, tax and loan note option
    
    
    1,143
    
    
    
    1,115
    
    
    
    
    
    
    
    1,070
    
    
    
    622
    
    
    
    2.71Other
    
    
    
    
    
    
    13,151
    
    
    
    5.36
    
    
    
    15,000
    
    
    
    12,213
    
    
    
    4.83$
    103,022
    
    
    
    
    
    
    
    
    
    
    $
    295,138
  55




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##### Table of Contents



At December 31,(Dollars in thousands)
    
    2009
    
    2008
    
    2007Amounts outstanding at end of period
    
    $
    68,560
    
    
    $
    151,500
    
    
    $
    51,500Weighted average rate at end of period
    
    
    2.91
    %
    
    
    2.63
    %
    
    
    4.10
    %Maximum amount outstanding at any month-end
    
    $
    151,500
    
    
    $
    156,600
    
    
    $
    101,500Approximate average outstanding for the year
    
    
    103,510
    
    
    
    128,687
    
    
    
    52,853Approximate weighted average rate for the year
    
    
    3.04
    %
    
    
    3.13
    %
    
    
    4.74
    %
 9. Subordinated Debentures
  Subordinated
    
    
    Trust PreferredDebentures Owed
    
    
    Securities of the
    
    
    Interest Rates at(Dollars in thousands)
    
    to Trusts
    
    
    Trusts
    
    
    December 31, 2009
    
    
    Final Maturity DateOKSB Statutory I
    
    $
    20,619
    
    
    $
    20,000
    
    
    
    3.35
    %
    
    June 26, 2033SBI Capital Trust II
    
    
    25,774
    
    
    
    25,000
    
    
    
    3.13
    %
    
    October 7, 2033Soutwest Capital Trust II
    
    
    35,570
    
    
    
    34,500
    
    
    
    10.50
    %
    
    September 15, 2038$
    81,963
    
    
    $
    79,500
  56




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57




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##### Table of Contents



Consolidation
 10. Income Taxes
  For the Year Ended December 31,(Dollars in thousands)
    
    2009
    
    2008
    
    2007Current tax expense:Federal
    
    $
    13,032
    
    
    $
    9,604
    
    
    $
    13,311State
    
    
    1,134
    
    
    
    1,961
    
    
    
    1,925Deferred tax benefit:Federal
    
    
    (6,158
    )
    
    
    (1,747
    )
    
    
    (1,371
    )State
    
    
    (397
    )
    
    
    (329
    )
    
    
    (268
    )Taxes on income
    
    $
    7,611
    
    
    $
    9,489
    
    
    $
    13,597
  For the Year Ended December 31,(Dollars in thousands)
    
    2009
    
    2008
    
    2007Computed tax expense at statutory rates
    
    $
    7,207
    
    
    $
    8,537
    
    
    $
    12,293Increase (decrease) in income
taxes resulting from:Benefit of income not subject to U.S. Federal income tax
    
    
    (142
    )
    
    
    (174
    )
    
    
    (137
    )Expenses not deductible for U.S. Federal income tax
    
    
    178
    
    
    
    372
    
    
    
    475State income taxes, net of Federal income tax benefit
    
    
    165
    
    
    
    405
    
    
    
    396New markets tax credit
    
    
    (151
    )
    
    
    (151
    )
    
    
    (151
    )Expiration of capital loss carryforward
    
    
    
    
    
    
    37
    
    
    
    Other
    
    
    354
    
    
    
    463
    
    
    
    721Taxes on income
    
    $
    7,611
    
    
    $
    9,489
    
    
    $
    13,597
  58




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At December 31,(Dollars in thousands)
    
    2009
    
    2008Provision for loan losses
    
    $
    24,751
    
    
    $
    16,907Accumulated depreciation
    
    
    (3,486
    )
    
    
    (3,280
    )Prepaid maintenance
    
    
    (359
    )
    
    
    (300
    )Nonaccrual loan interest
    
    
    792
    
    
    
    214Deferred compensation accrual
    
    
    261
    
    
    
    233Mark-to-market adjustments
    
    
    47
    
    
    
    221FHLB stock dividends
    
    
    (989
    )
    
    
    (922
    )Write-downs on other real estate
    
    
    10
    
    
    
    10Amortizable assets
    
    
    (404
    )
    
    
    (485
    )Stock-based compensation
    
    
    177
    
    
    
    177Litigation and settlement
    
    
    2
    
    
    
    135New markets tax credit
    
    
    (460
    )
    
    
    (379
    )Dividend  equity vs cost method
    
    
    (209
    )
    
    
    (217
    )Section 597 gain  FNBA FDIC-assisted acquisition
    
    
    (589
    )
    
    
    Inside basis difference on acquired loans
    
    
    (562
    )
    
    
    Other
    
    
    (58
    )
    
    
    5618,924
    
    
    
    12,370Deferred taxes (payable) receivable on
investment securities available for sale
    
    
    568
    
    
    
    1,885Net deferred tax asset
    
    $
    19,492
    
    
    $
    14,255
   (Dollars in thousands)
    
    2009
    
    2008Balance at January 1
    
    $
    3,966
    
    
    $
    3,216Increases in unrecognized tax benefits as a result of tax positions taken during current
period
    
    
    631
    
    
    
    750Increases in unrecognized tax benefits as a result of tax positions taken during prior period
    
    
    
    
    
    
    Amount of decreases in unrecognized tax benefits relating to settlements with taxing
authorities
    
    
    
    
    
    
    Reductions to unrecognized tax benefits  lapse of the applicable statute of limitations
    
    
    
    
    
    
    Balance at December 31
    
    $
    4,597
    
    
    $
    3,966
   59




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##### Table of Contents



11. Shareholders Equity
       12. Earnings Per Common Share
 Earnings Per Share
  60




---



##### Table of Contents



(Dollars in thousands, except earnings per share data)
    
    2009
    
    2008
    
    2007Numerator:Net income
    
    $
    12,982
    
    
    $
    14,901
    
    
    $
    21,378Preferred dividend
    
    
    (3,500
    )
    
    
    (243
    )
    
    
    Warrant amortization
    
    
    (645
    )
    
    
    
    
    
    
    Net income available to common shareholders
    
    $
    8,837
    
    
    $
    14,658
    
    
    $
    21,378Earnings allocated to participating securities
    
    
    (26
    )
    
    
    (31
    )
    
    
    (33
    )Numerator for basic earnings per common share
    
    $
    8,811
    
    
    $
    14,627
    
    
    $
    21,345Effect of reallocating undistributed earnings
of participating securities
    
    
    (22
    )
    
    
    (19
    )
    
    
    (24
    )Numerator for diluted earnings per common share
    
    $
    8,789
    
    
    $
    14,608
    
    
    $
    21,321Denominator:Denominator
for basic earnings per common share  Weighted average common shares outstanding
    
    
    14,625,847
    
    
    
    14,471,242
    
    
    
    14,291,041Effect of dilutive securities:Stock options
    
    
    48,279
    
    
    
    157,037
    
    
    
    304,474Warrant
    
    
    
    
    
    
    
    
    
    
    Denominator for diluted earnings per common share
    
    
    14,674,126
    
    
    
    14,628,279
    
    
    
    14,595,515Earnings per common share:Basic
    
    $
    0.60
    
    
    $
    1.01
    
    
    $
    1.49Diluted
    
    $
    0.60
    
    
    $
    1.00
    
    
    $
    1.46
 13. Capital Requirements & Regulatory Matters
   61




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To Be Well CapitalizedUnder Prompt Corrective
    
    
    For CapitalActual
    
    
    Action Provisions
    
    
    Adequacy Purposes(Dollars in thousands)
    
    Amount
    
    
    Ratio
    
    
    Amount
    
    
    Ratio
    
    
    Amount
    
    
    RatioAs of December 31, 2009:Total Capital (to risk-weighted assets)Southwest
    
    $
    413,438
    
    
    
    14.55
    %
    
    
    N/A
    
    
    
    N/A
    
    
    $
    227,318
    
    
    
    8.00
    %Stillwater National
    
    
    357,219
    
    
    
    13.84
    
    
    $
    258,032
    
    
    
    10.00
    %
    
    
    206,426
    
    
    
    8.00Bank of Kansas
    
    
    28,476
    
    
    
    11.39
    
    
    
    24,991
    
    
    
    10.00
    
    
    
    19,993
    
    
    
    8.00Tier I Capital (to risk-weighted assets)Southwest
    
    
    377,418
    
    
    
    13.28
    
    
    
    N/A
    
    
    
    N/A
    
    
    
    113,659
    
    
    
    4.00Stillwater National
    
    
    309,530
    
    
    
    12.00
    
    
    
    154,819
    
    
    
    6.00
    
    
    
    103,213
    
    
    
    4.00Bank of Kansas
    
    
    25,352
    
    
    
    10.14
    
    
    
    14,994
    
    
    
    6.00
    
    
    
    9,996
    
    
    
    4.00Tier I Leverage (to average assets)Southwest
    
    
    377,418
    
    
    
    12.42
    
    
    
    N/A
    
    
    
    N/A
    
    
    
    121,561
    
    
    
    4.00Stillwater National
    
    
    309,530
    
    
    
    11.37
    
    
    
    136,115
    
    
    
    5.00
    
    
    
    108,892
    
    
    
    4.00Bank of Kansas
    
    
    25,352
    
    
    
    7.13
    
    
    
    17,771
    
    
    
    5.00
    
    
    
    14,217
    
    
    
    4.00As of December 31, 2008:Total Capital (to risk-weighted assets)Southwest
    
    $
    404,695
    
    
    
    14.26
    %
    
    
    N/A
    
    
    
    N/A
    
    
    $
    226,998
    
    
    
    8.00
    %Stillwater National
    
    
    351,957
    
    
    
    12.89
    
    
    $
    273,111
    
    
    
    10.00
    %
    
    
    218,489
    
    
    
    8.00SNB Wichita*
    
    
    7,372
    
    
    
    12.81
    
    
    
    5,756
    
    
    
    10.00
    
    
    
    4,604
    
    
    
    8.00SNB Kansas*
    
    
    8,763
    
    
    
    17.18
    
    
    
    5,102
    
    
    
    10.00
    
    
    
    4,081
    
    
    
    8.00Tier I Capital (to risk-weighted assets)Southwest
    
    
    369,049
    
    
    
    13.01
    
    
    
    N/A
    
    
    
    N/A
    
    
    
    113,499
    
    
    
    4.00Stillwater National
    
    
    302,641
    
    
    
    11.08
    
    
    
    163,867
    
    
    
    6.00
    
    
    
    109,244
    
    
    
    4.00SNB Wichita*
    
    
    6,652
    
    
    
    11.56
    
    
    
    3,453
    
    
    
    6.00
    
    
    
    2,302
    
    
    
    4.00SNB Kansas*
    
    
    8,125
    
    
    
    15.93
    
    
    
    3,061
    
    
    
    6.00
    
    
    
    2,041
    
    
    
    4.00Tier I Leverage (to average assets)Southwest
    
    
    369,049
    
    
    
    13.06
    
    
    
    N/A
    
    
    
    N/A
    
    
    
    113,059
    
    
    
    4.00Stillwater National
    
    
    302,641
    
    
    
    11.23
    
    
    
    134,774
    
    
    
    5.00
    
    
    
    107,819
    
    
    
    4.00SNB Wichita*
    
    
    6,652
    
    
    
    8.33
    
    
    
    3,995
    
    
    
    5.00
    
    
    
    3,196
    
    
    
    4.00SNB Kansas*
    
    
    8,125
    
    
    
    9.24
    
    
    
    4,339
    
    
    
    5.00
    
    
    
    3,519
    
    
    
    4.00
 
 *
    
    SNB Wichita and SNB Kansas were merged to form Bank of Kansas on January 23, 2009.    62




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##### Table of Contents



14. Employee Benefits
  Stock Options
  2009
    
    2008
    
    2007Expected dividend yield
    
    
    N/A
    
    
    
    2.24
    %
    
    
    1.45
    %Expected volatility
    
    
    N/A
    
    
    
    34.36
    %
    
    
    29.70
    %Risk-free interest rate
    
    
    N/A
    
    
    
    2.30
    %
    
    
    4.48
    %Expected option term (in years)
    
    
    N/A
    
    
    
    3.00
    
    
    
    2.50
   63




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##### Table of Contents



WeightedWeighted
    
    Average AggregateAverage
    
    Remaining
    
    IntrinsicNumber of
    
    Exercise
    
    Contractual
    
    Value (dollarsOptions
    
    Price
    
    Life (Years)
    
    in thousands)Outstanding at December 31, 2006
    
    
    860,010
    
    
    $
    13.50Granted
    
    
    124,431
    
    
    
    25.78Exercised
    
    
    (96,338
    )
    
    
    9.88Canceled/expired
    
    
    (4,333
    )
    
    
    26.58Outstanding at December 31, 2007
    
    
    883,770
    
    
    $
    15.56Granted
    
    
    5,000
    
    
    
    16.93Exercised
    
    
    (193,758
    )
    
    
    9.99Canceled/expired
    
    
    (3,901
    )
    
    
    21.39Outstanding at December 31, 2008
    
    
    691,111
    
    
    $
    17.10Granted
    
    
    
    
    
    
    Exercised
    
    
    (139,170
    )
    
    
    6.39Canceled/expired
    
    
    (172,617
    )
    
    
    17.20Outstanding at December 31, 2009
    
    
    379,324
    
    
    $
    20.98
    
    
    
    1.22
    
    
    $
    69Total exercisable at December 31, 2007
    
    
    705,670
    
    
    $
    14.56Total exercisable at December 31, 2008
    
    
    634,451
    
    
    $
    16.85Total exercisable at December 31, 2009
    
    
    377,657
    
    
    $
    21.00
    
    
    
    1.21
    
    
    $
    69
    Shares
    
    WeightedIssuable
    
    AverageUpon Exercise
    
    Grant Dateof Options
    
    Fair ValueNonvested Balance at
December 31, 2008
    
    
    56,660
    
    
    $
    4.36Granted
    
    
    
    
    
    
    Vested
    
    
    (54,993
    )
    
    
    4.38Forfeited
    
    
    
    
    
    
    Nonvested Balance at
December 31, 2009
    
    
    1,667
    
    
    $
    3.71
  64




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##### Table of Contents



Restricted Stock
  15. Related Party Transactions
   16. Operating Leases
  2010
    
    $2.7 million2011
    
    $2.1 million2012
    
    $1.6 million2013
    
    $1.1 million2014
    
    $0.9 millionThereafter
    
    $1.7 million
  17. Financial Instruments with Off-Balance Sheet Risk
  65




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##### Table of Contents



At December 31,(Dollars in thousands)
    
    2009
    
    2008Commitments to extend commercial and real estate mortgage credit
    
    $
    387,486
    
    
    $
    649,830Standby and commercial letters of credit
    
    
    5,105
    
    
    
    7,752Total
    
    $
    392,591
    
    
    $
    657,582
  18. Commitments and Contingencies
    19. VISA USA Shares
  66




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##### Table of Contents



20. Supplemental Cash Flow Information
 For the Years Ended December 31,(Dollars in thousands)
    
    2009
    
    2008
    
    2007Cash paid for interest
    
    $
    55,535
    
    
    $
    77,498
    
    
    $
    86,407Cash paid for taxes on income
    
    
    12,434
    
    
    
    9,774
    
    
    
    14,808Loans transferred to other real estate owned
    
    
    23,552
    
    
    
    14,479
    
    
    
    1,284
 21. Operating Segments
       67




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##### Table of Contents



For the Year Ended December 31, 2009Oklahoma
    
    Texas
    
    Kansas
    
    Other States
    
    Secondary
    
    Other
    
    Total(Dollars in thousands)
    
    Banking
    
    Banking
    
    Banking**
    
    Banking
    
    Market
    
    Operations*
    
    CompanyNet interest income
    
    $
    44,651
    
    
    $
    42,236
    
    
    $
    14,518
    
    
    $
    9,424
    
    
    $
    1,139
    
    
    $
    (13,277
    )
    
    $
    98,691Provision for loan losses
    
    
    7,977
    
    
    
    12,838
    
    
    
    8,053
    
    
    
    10,308
    
    
    
    
    
    
    
    
    
    
    
    39,176Noninterest income
    
    
    8,899
    
    
    
    1,805
    
    
    
    6,020
    
    
    
    422
    
    
    
    2,063
    
    
    
    2,727
    
    
    
    21,936Noninterest expenses
    
    
    25,993
    
    
    
    13,877
    
    
    
    11,918
    
    
    
    2,146
    
    
    
    3,439
    
    
    
    3,485
    
    
    
    60,858Income before taxes
    
    
    19,580
    
    
    
    17,326
    
    
    
    567
    
    
    
    (2,608
    )
    
    
    (237
    )
    
    
    (14,035
    )
    
    
    20,593Taxes on income
    
    
    7,420
    
    
    
    6,604
    
    
    
    143
    
    
    
    (990
    )
    
    
    (89
    )
    
    
    (5,477
    )
    
    
    7,611Net income
    
    $
    12,160
    
    
    $
    10,722
    
    
    $
    424
    
    
    $
    (1,618
    )
    
    $
    (148
    )
    
    $
    (8,558
    )
    
    $
    12,982
 
 *
    
    Includes externally generated revenue of $9.6 million, primarily from investing services, and an internally generated loss of $20.2 million from the funds
management unit**
    
    Noninterest income includes the $3.3 million gain on acquisition previously described. Fixed asset expenditures
    
    $
    2,290
    
    
    $
    10
    
    
    $
    2,419
    
    
    $
    
    
    
    $
    
    
    
    $
    526
    
    
    $
    5,245Total loans at period end
    
    
    933,150
    
    
    
    1,054,404
    
    
    
    359,633
    
    
    
    277,512
    
    
    
    43,134
    
    
    
    
    
    
    
    2,667,833Total assets at period end
    
    
    950,355
    
    
    
    1,044,324
    
    
    
    441,114
    
    
    
    275,653
    
    
    
    45,148
    
    
    
    351,697
    
    
    
    3,108,291Total deposits at period
end
    
    
    1,640,839
    
    
    
    160,064
    
    
    
    283,506
    
    
    
    
    
    
    
    1,527
    
    
    
    506,794
    
    
    
    2,592,730
 For the Year Ended December 31, 2008Oklahoma
    
    Texas
    
    Kansas
    
    Other States
    
    Secondary
    
    Other
    
    Total(Dollars in thousands)
    
    Banking
    
    Banking
    
    Banking
    
    Banking
    
    Market
    
    Operations *
    
    CompanyNet interest income
    
    $
    48,218
    
    
    $
    33,802
    
    
    $
    9,090
    
    
    $
    9,486
    
    
    $
    1,392
    
    
    $
    (12,269
    )
    
    $
    89,719Provision for loan losses
    
    
    5,359
    
    
    
    7,615
    
    
    
    4,396
    
    
    
    1,609
    
    
    
    
    
    
    
    
    
    
    
    18,979Noninterest income
    
    
    8,607
    
    
    
    1,920
    
    
    
    12
    
    
    
    187
    
    
    
    1,500
    
    
    
    3,912
    
    
    
    16,138Noninterest expenses
    
    
    30,794
    
    
    
    15,731
    
    
    
    6,261
    
    
    
    3,281
    
    
    
    3,132
    
    
    
    3,289
    
    
    
    62,488Income before taxes
    
    
    20,672
    
    
    
    12,376
    
    
    
    (1,555
    )
    
    
    4,783
    
    
    
    (240
    )
    
    
    (11,646
    )
    
    
    24,390Taxes on income
    
    
    8,167
    
    
    
    4,825
    
    
    
    (433
    )
    
    
    2,027
    
    
    
    (96
    )
    
    
    (5,001
    )
    
    
    9,489Net income
    
    $
    12,505
    
    
    $
    7,551
    
    
    $
    (1,122
    )
    
    $
    2,756
    
    
    $
    (144
    )
    
    $
    (6,645
    )
    
    $
    14,901
 
 *
    
    Includes externally generated revenue of $9.6 million, primarily from investing services, and an internally generated loss of $18.0 million from the funds
management unit Fixed asset expenditures
    
    $
    1,678
    
    
    $
    765
    
    
    $
    306
    
    
    $
    29
    
    
    $
    
    
    
    $
    878
    
    
    $
    3,656Total loans at period end
    
    
    966,243
    
    
    
    947,603
    
    
    
    304,855
    
    
    
    275,805
    
    
    
    56,941
    
    
    
    
    
    
    
    2,551,447Total assets at period end
    
    
    984,298
    
    
    
    945,907
    
    
    
    310,503
    
    
    
    272,599
    
    
    
    61,149
    
    
    
    305,306
    
    
    
    2,879,762Total deposits at period
end
    
    
    1,394,008
    
    
    
    133,745
    
    
    
    146,182
    
    
    
    
    
    
    
    1,550
    
    
    
    504,637
    
    
    
    2,180,122
 68




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##### Table of Contents



For the Year Ended December 31, 2007Oklahoma
    
    Texas
    
    Kansas
    
    Other States
    
    Secondary
    
    Other
    
    Total(Dollars in thousands)
    
    Banking
    
    Banking
    
    Banking
    
    Banking
    
    Market
    
    Operations *
    
    CompanyNet interest income
    
    $
    48,103
    
    
    $
    26,711
    
    
    $
    10,209
    
    
    $
    6,850
    
    
    $
    1,738
    
    
    $
    (1,014
    )
    
    $
    92,597Provision for loan losses
    
    
    2,317
    
    
    
    4,189
    
    
    
    1,253
    
    
    
    1,188
    
    
    
    
    
    
    
    
    
    
    
    8,947Noninterest income
    
    
    9,505
    
    
    
    1,616
    
    
    
    181
    
    
    
    119
    
    
    
    3,403
    
    
    
    1,609
    
    
    
    16,433Noninterest expenses
    
    
    29,408
    
    
    
    13,462
    
    
    
    7,858
    
    
    
    2,255
    
    
    
    3,360
    
    
    
    8,765
    
    
    
    65,108Income before taxes
    
    
    25,883
    
    
    
    10,676
    
    
    
    1,279
    
    
    
    3,526
    
    
    
    1,781
    
    
    
    (8,170
    )
    
    
    34,975Taxes on income
    
    
    9,946
    
    
    
    4,126
    
    
    
    420
    
    
    
    1,363
    
    
    
    684
    
    
    
    (2,942
    )
    
    
    13,597Net income
    
    $
    15,937
    
    
    $
    6,550
    
    
    $
    859
    
    
    $
    2,163
    
    
    $
    1,097
    
    
    $
    (5,228
    )
    
    $
    21,378
 
 *
    
    Includes externally generated revenue of $4.4 million, primarily from consulting services, and an internally generated loss of $3.8
million from the funds management unit Fixed asset expenditures
    
    $
    1,169
    
    
    $
    728
    
    
    $
    545
    
    
    $
    
    
    
    $
    57
    
    
    $
    788
    
    
    $
    3,287Total loans at period end
    
    
    876,085
    
    
    
    759,389
    
    
    
    282,846
    
    
    
    227,237
    
    
    
    66,275
    
    
    
    
    
    
    
    2,211,832Total assets at period end
    
    
    883,156
    
    
    
    759,837
    
    
    
    294,927
    
    
    
    230,109
    
    
    
    71,843
    
    
    
    324,426
    
    
    
    2,564,298Total deposits at period end
    
    
    1,278,954
    
    
    
    127,053
    
    
    
    120,754
    
    
    
    
    
    
    
    1,346
    
    
    
    530,472
    
    
    
    2,058,579
 22. Parent Company Condensed Financial Information
  At December 31,(Dollars in thousands)
    
    2009
    
    2008Statements of Financial ConditionAssets:Cash and due from banks
    
    $
    13,918
    
    
    $
    48,086Investment in subsidiary banks
    
    
    361,748
    
    
    
    338,454Investments in other subsidiaries
    
    
    13,360
    
    
    
    10,153Investment securities, available for sale
    
    
    1,079
    
    
    
    888Other assets
    
    
    2,560
    
    
    
    4,063Total
    
    $
    392,665
    
    
    $
    401,644Liabilities:Subordinated debentures
    
    $
    81,963
    
    
    $
    81,963Notes payable
    
    
    
    
    
    
    15,000Other liabilities
    
    
    924
    
    
    
    2,478Shareholders Equity:Preferred stock and related accounts
    
    
    67,037
    
    
    
    66,392Common stock and related accounts
    
    
    242,741
    
    
    
    235,811Total
    
    $
    392,665
    
    
    $
    401,644
 69




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##### Table of Contents



For the Year Ended December 31,(Dollars in thousands)
    
    2009
    
    2008
    
    2007Statements of OperationsIncome:Cash dividends from subsidiaries
    
    $
    6,655
    
    
    $
    2,149
    
    
    $
    7,117Noninterest income
    
    
    1,091
    
    
    
    995
    
    
    
    Investment income
    
    
    101
    
    
    
    (275
    )
    
    
    389Total income
    
    
    7,847
    
    
    
    2,869
    
    
    
    7,506Expense:Interest on subordinated debentures
    
    
    5,495
    
    
    
    4,961
    
    
    
    3,894Noninterest expense
    
    
    2,273
    
    
    
    2,001
    
    
    
    2,492Total expense
    
    
    7,768
    
    
    
    6,962
    
    
    
    6,386Total income (loss) before taxes and equity in
undistributed income of subsidiaries
    
    
    79
    
    
    
    (4,093
    )
    
    
    1,120Taxes on income
    
    
    (2,440
    )
    
    
    (2,303
    )
    
    
    (2,036
    )Income before equity in undistributed
income of subsidiaries
    
    
    2,519
    
    
    
    (1,790
    )
    
    
    3,156Equity in undistributed income of subsidiaries
    
    
    10,463
    
    
    
    16,691
    
    
    
    18,222Net income
    
    $
    12,982
    
    
    $
    14,901
    
    
    $
    21,378
 For the Year Ended December 31,(Dollars in thousands)
    
    2009
    
    2008
    
    2007Statements of Cash FlowsOperating activities:Net income
    
    $
    12,982
    
    
    $
    14,901
    
    
    $
    21,378Equity in undistributed income of subsidiaries
    
    
    (10,463
    )
    
    
    (16,691
    )
    
    
    (18,222
    )Other, net
    
    
    1,301
    
    
    
    (2,548
    )
    
    
    1,343Net cash provided by (used in) operating activities
    
    
    3,820
    
    
    
    (4,338
    )
    
    
    4,499Investing activities:Available for sale securities:Purchases
    
    
    (156
    )
    
    
    (2
    )
    
    
    (35
    )Sales / Maturities
    
    
    118
    
    
    
    12,124
    
    
    
    13,124Capital contribution to Banks
    
    
    (8,500
    )
    
    
    (77,000
    )
    
    
    (15,510
    )Investment in/capital contribution to other subsidiaries
    
    
    (10,010
    )
    
    
    (1,070
    )
    
    
    Return of capital/advances from other subsidiaries
    
    
    100
    
    
    
    
    
    
    
    450Net cash used in investing activities
    
    
    (18,448
    )
    
    
    (65,948
    )
    
    
    (1,971
    )Financing activities:Net increase (decrease) in short-term borrowings
    
    
    (15,000
    )
    
    
    12,500
    
    
    
    2,500Net proceeds from issuance of common stock
    
    
    1,193
    
    
    
    2,380
    
    
    
    1,460Proceeds from issuance of subordinated debentures
    
    
    
    
    
    
    35,570
    
    
    
    Proceeds from issuance of preferred stock
    
    
    
    
    
    
    70,000
    
    
    
    Preferred stock dividend
    
    
    (3,940
    )
    
    
    (243
    )
    
    
    Common stock dividends
    
    
    (1,793
    )
    
    
    (5,219
    )
    
    
    (5,145
    )Net cash provided by (used in) financing activities
    
    
    (19,540
    )
    
    
    114,988
    
    
    
    (1,185
    )Net increase (decrease) in cash and cash equivalents
    
    
    (34,168
    )
    
    
    44,702
    
    
    
    1,343Cash and
cash equivalents, Beginning of year
    
    
    48,086
    
    
    
    3,384
    
    
    
    2,041End of year
    
    $
    13,918
    
    
    $
    48,086
    
    
    $
    3,384
 70




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##### Table of Contents



23. Selected Quarterly Financial Data (Unaudited)
 For the Quarter Ended(Dollars in thousands, except per share data)
    
    12-31-09
    
    09-30-09
    
    06-30-09
    
    03-31-09Operations DataInterest income
    
    $
    38,789
    
    
    $
    37,733
    
    
    $
    38,091
    
    
    $
    35,786Interest expense
    
    
    10,992
    
    
    
    12,333
    
    
    
    13,635
    
    
    
    14,748Net interest income
    
    
    27,797
    
    
    
    25,400
    
    
    
    24,456
    
    
    
    21,038Provision for loan losses
    
    
    10,640
    
    
    
    10,177
    
    
    
    7,477
    
    
    
    10,882Gain on sales of securities and loans
    
    
    936
    
    
    
    396
    
    
    
    917
    
    
    
    3,639Noninterest income
    
    
    3,552
    
    
    
    3,314
    
    
    
    6,344
    
    
    
    2,838Noninterest expenses
    
    
    16,041
    
    
    
    15,528
    
    
    
    14,690
    
    
    
    14,599Income before taxes
    
    
    5,604
    
    
    
    3,405
    
    
    
    9,550
    
    
    
    2,034Taxes on income
    
    
    2,030
    
    
    
    1,271
    
    
    
    3,605
    
    
    
    705Net income
    
    $
    3,574
    
    
    $
    2,134
    
    
    $
    5,945
    
    
    $
    1,329Per Share DataBasic earnings per common share
    
    $
    0.17
    
    
    $
    0.07
    
    
    $
    0.34
    
    
    $
    0.02Diluted earnings per common share
    
    
    0.17
    
    
    
    0.07
    
    
    
    0.33
    
    
    
    0.02Dividends declared per common share
    
    
    0.0238
    
    
    
    0.0238
    
    
    
    0.0238
    
    
    
    0.0238Weighted average common shares outstandingBasic
    
    
    14,706,718
    
    
    
    14,649,061
    
    
    
    14,586,025
    
    
    
    14,555,058Diluted
    
    
    14,740,449
    
    
    
    14,709,134
    
    
    
    14,626,952
    
    
    
    14,631,471
 For the Quarter Ended(Dollars in thousands, except per share data)
    
    12-31-08
    
    09-30-08
    
    06-30-08
    
    03-31-08Operations DataInterest income
    
    $
    38,895
    
    
    $
    40,994
    
    
    $
    39,931
    
    
    $
    42,974Interest expense
    
    
    16,481
    
    
    
    17,806
    
    
    
    17,647
    
    
    
    21,141Net interest income
    
    
    22,414
    
    
    
    23,188
    
    
    
    22,284
    
    
    
    21,833Provision for loan losses
    
    
    6,698
    
    
    
    6,855
    
    
    
    3,190
    
    
    
    2,236Gain on sales of securities and loans
    
    
    324
    
    
    
    551
    
    
    
    606
    
    
    
    2,085Noninterest income
    
    
    3,105
    
    
    
    3,511
    
    
    
    3,353
    
    
    
    2,603Noninterest expenses
    
    
    13,793
    
    
    
    16,533
    
    
    
    16,332
    
    
    
    15,830Income before taxes
    
    
    5,352
    
    
    
    3,862
    
    
    
    6,721
    
    
    
    8,455Taxes on income
    
    
    2,127
    
    
    
    1,556
    
    
    
    2,559
    
    
    
    3,247Net income
    
    $
    3,225
    
    
    $
    2,306
    
    
    $
    4,162
    
    
    $
    5,208Per Share DataBasic earnings per common share
    
    $
    0.21
    
    
    $
    0.16
    
    
    $
    0.29
    
    
    $
    0.36Diluted earnings per common share
    
    
    0.20
    
    
    
    0.16
    
    
    
    0.28
    
    
    
    0.36Dividends declared per common share
    
    
    0.0950
    
    
    
    0.0950
    
    
    
    0.0950
    
    
    
    0.0950Weighted average common shares outstandingBasic
    
    
    14,450,733
    
    
    
    14,527,893
    
    
    
    14,526,038
    
    
    
    14,413,686Diluted
    
    
    14,673,616
    
    
    
    14,676,082
    
    
    
    14,680,262
    
    
    
    14,608,190
 71




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24. Accounting Standard Issued But Not Yet Adopted
 Transfers and Servicing
 Consolidation
 72




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OTHER
MATERIAL REQUIRED BY FORM 10-K
 
 Business
 General
  Products and Services
 SNB DirectBanker®,
 Strategic Focus
 SNB DirectBanker®
 73




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##### Table of Contents



Organization
  Banking Segments
 Oklahoma Banking Segment
 Texas Banking Segment
 Kansas Banking Segment
 Other States Banking Segment
 Secondary Market Segment
  74




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Support and Control Functions SNB
DirectBanker®
  Banking Offices and Geographic Markets
   Competition
   75




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Regulation, Supervision, and Governmental Policy
  Bank Holding Company Regulation.
   76




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National Bank Regulation
   77




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State Non-Member Bank Regulation
   Limits on Loans to One Borrower.
 Transactions with Affiliates
 Real Estate Lending Guidelines
 78




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Federal Deposit Insurance
 Regulatory Capital Requirements
     79




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Brokered Deposits
 Supervision and Regulation of Mortgage Banking Operations
 80




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Community Reinvestment
 Bank Secrecy Act
 Sarbanes-Oxley Act of 2002
 Capital Purchase Program.
 81




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Temporary Liquidity Guarantee Program.
 Other Laws and Regulations
 Enforcement Actions
 Employees
  82




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Board of Directors of Southwest Bancorp, Inc. and Stillwater National Bank & Trust Company
 Robert B. Rodgers, Chairman of the Board
    
    President, Bob Rodgers Motor CompanyRick Green, Vice Chairman of the Board
    
    President and Chief Executive Officer
Southwest and Stillwater NationalJames E. Berry II
    
    Owner, Shading ConceptsTom D. Berry
    
    Auctioneer, Real Estate Broker, Oil & Gas ExplorationJoe Berry Cannon
    
    Assistant Professor of Management, Oral Roberts
University School of BusinessJohn Cohlmia
    
    Real Estate Broker, Grubb & Ellis/Levy BeffortDavid S. Crockett Jr., CPA
    
    Owner, David S. Crockett & Co., CPAsJ. Berry Harrison
    
    Oklahoma State Senator (retired) and RancherJames M. Johnson
    
    Self-employed Small Business OwnerDavid P. Lambert
    
    Chairman of the Board, Lambert Construction CompanyLinford R. Pitts
    
    President, Stillwater Transfer & Storage, Inc.Russell W. Teubner
    
    Founder and Chief Executive Officer,
HostBridge TechnologyBoard of Directors of Bank of KansasRobert B. Rodgers, Chairman of the Board
    
    President, Bob Rodgers Motor CompanyRick Green, Vice Chairman of the Board
    
    President and Chief Executive Officer
Southwest and Stillwater NationalPatrick L. Gearhart
    
    President, Wichita Division of Bank of KansasJerry Lanier
    
    President and Chief Executive Officer, Bank of Kansas;
Executive Vice President and Chief Lending Officer of
Stillwater NationalDavid Lesperance
    
    President, Hutchinson Division of Bank of KansasAnthony W. Martin
    
    Retired DentistDavid W. Pitts
    
    Executive Vice President and Regional Director, Bank of Kansas; Senior Vice
President of Stillwater NationalDouglas J. Watts
    
    President, Kansas City Division of Stillwater National
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Executive Officers
  Name
    
    
    Age
    
    
    PositionPriscilla Barnes
    
    
    53
    
    
    Executive Vice President, Director of Human Resources and
Compliance of Stillwater National and Bank of KansasKerby E. Crowell
    
    
    60
    
    
    Executive Vice President, Chief Financial Officer, and Secretary
of Southwest and Stillwater National; Executive Vice President,
Chief Financial Officer, Cashier, and Secretary of Bank of
KansasDavid Dietz
    
    
    54
    
    
    Executive Vice President and Chief Information Officer of Stillwater National and Bank of
KansasSteven M. Gobel
    
    
    58
    
    
    Executive Vice President, Chief Accounting and Controls Officer
and Associate Chief Financial Officer of Southwest and
Stillwater National; Executive Vice President, Chief Accounting
Officer and Assistant Secretary of Bank of KansasJerry L. Lanier
    
    
    61
    
    
    Executive Vice President and Chief Lending Officer of Stillwater
National; President and Chief Executive Officer of Bank of
KansasDavid W. Pitts
    
    
    49
    
    
    Executive Vice President and Regional Director, Bank of Kansas;
Senior Vice President of Stillwater NationalLaura Robertson
    
    
    36
    
    
    Senior Vice President, Public Company Reporting and Tax Manager
of Southwest and Stillwater NationalKimberly G. Sinclair
    
    
    54
    
    
    Executive Vice President and Chief Administrative Officer of
Stillwater National and Bank of KansasCharles H. Westerheide
    
    
    61
    
    
    Executive Vice President and Treasurer of Southwest, Stillwater
National and Bank of Kansas
  Priscilla Barnes
 Kerby E. Crowell
 84




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David Dietz
 Steven M. Gobel
 Jerry L. Lanier
 Laura Robertson
 Kimberly G. Sinclair
 Charles H. Westerheide
 85




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86




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RISK FACTORS
 Investing in our common stock involves risks. You should carefully consider the following
risk factors before you decide to make an investment decision regarding our stock. The risk
factors may cause our future earnings to be lower or our financial condition to be less favorable
than we expect. In addition, other risks of which we are not aware, or which we do not believe are
material, may cause earnings to be lower or may hurt our financial condition. You should also
consider the other information in this Annual Report on Form 10-K, as well as in the documents
incorporated by reference into it.
 Difficult and unsettled market conditions have affected our profits and loan quality and may
continue to do so for an unknown period.
  
    
    There may be less demand for our products and services.
    
    Competition in our industry could intensify as a result of increased consolidation of
the banking industry.
    
    It may become more difficult to estimate losses inherent in our loan portfolio.
    
    Loan delinquencies and problem assets may increase.
    
    Collateral for loans may decline in value, increasing loan to value ratios and reducing
our customers borrowing power and the security for our loans.
    
    Deposits and borrowings may become even more expensive relative to yields on loans and
securities, further reducing our net interest margin, and making it more difficult to
maintain adequate sources of liquidity.
    
    Asset based liquidity, which depends upon the marketability of assets such as student
loans and mortgages, may be reduced.
    
    Weak market conditions for banking industry securities may make it unattractive or
impractical to raise funds through equity offerings.
    
    Compliance with new banking regulations enacted in connection with stimulus legislation
may increase our costs, limit our ability to pursue business opportunities, and impair our
ability to hire and retain talented managers.
 Changes in interest rates and other factors beyond our control may adversely affect our
earnings and financial condition.
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Changes in local economic conditions could adversely affect our business.
  Adverse changes in healthcare-related businesses could lead to slower loan growth and higher
levels of problem loans and charge-offs.
  Our allowance for loan losses may not be adequate to cover our actual loan losses, which could
adversely affect our earnings.
   Unseasoned loans may increase the risk of credit defaults in the future.
  88




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We use wholesale funding sources to supplement our core deposits, which exposes us to
liquidity risk and potential earnings volatility or other adverse effects if we are unable to
secure adequate funding.
   Government regulation significantly affects our business.
   Our ability to pay dividends is limited by law, contract, and banking agency discretion.
  89




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We have entered into formal and informal agreements with the OCC and have informal commitments
to the Federal Reserve that may adversely affect our operations. Failure to comply with these
agreements and commitments could subject Southwest, Stillwater National, and their directors to
additional enforcement actions and could damage our reputation.
  Our decisions regarding the fair value of assets acquired could be inaccurate and our
estimated loss share receivable in FDIC-assisted acquisitions may be inadequate, which could
adversely affect our business, financial condition, results of operations, and future prospects.
    90




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The acquisition of banks, bank branches, and other businesses involve risks.
  The market price for our common stock may be highly volatile.
  
    
    Variations in our anticipated or actual operating results or the results of
our competitors;
    
    Changes in investors or analysts perceptions of the risks and conditions
of our business;
    
    The size of the public float of our common stock;
    
    Regulatory developments;
    
    The announcement of acquisitions or new branch locations by us or our
competitors;
    
    Market conditions; and
    
    General economic conditions.
 Restrictions on unfriendly acquisitions could prevent a takeover.
   Future sales of our common stock or other securities may dilute the value of our common stock.
   We rely on our management and other key personnel, and the loss of any of them may adversely
affect our operations.
  91




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Competition may decrease our growth or profits.
  92




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Availability of Filings
  93




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Properties
  Southwest Bancorp, Inc.Corporate Headquarters608 S. Main StreetP.O. Box 1988
    
    Stillwater, Oklahoma 74076
    
    405-742-1800www.oksb.comBank of Kansas LocationsCorporate Headquarters524 N. Main StreetP.O. Box 1707 South
    
    Hutchinson, Kansas 67505
    
    620-728-3000www.bankofkansas.comAnthony203 W. Main StreetP.O. Box 484
    
    Anthony, Kansas 67003
    
    620-842-1000Harper1002 Central Street*P.O. Box 7
    
    Harper, Kansas 67058
    
    620-896-1035North hutchinson100 East 30th AvenueP.O. Box 1707
    
    Hutchinson, Kansas 67502
    
    620-728-3000Mayfield102 N. Osborn
    
    Mayfield, Kansas 67103
    
    620-434-5325Overland Park14435 Metcalf Avenue
    
    Overland Park, Kansas 66223
    
    913-906-4444Wichita  East8415 E. 21st Street North, Suite 150*
    
    Wichita, Kansas 67206
    
    316-315-1600Wichita  West10111 W. 21st Street North
    
    Wichita, Kansas 67205
    
    316-315-1600Stillwater National Bank & Trust Company LocationsCorporate Headquarters608 S. Main StreetP.O. Box 1988
    
    Stillwater, Oklahoma 74076
    
    405-372-2230www.banksnb.comDrive-in Facility308 S. Main StreetP.O. Box 1988
    
    Stillwater, Oklahoma 74076
    
    405-372-2230Operations Center1624 Cimarron Plaza*P.O. Box 1988
    
    Stillwater, Oklahoma 74076
    
    405-372-2230
 94




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##### Table of Contents



19th & Sangre Branch1908 S. SangreP.O. Box 1988
    
    Stillwater, Oklahoma 74074
    
    405-372-2230OSU Campus Branch Bank1102 W. Hall of Fame Avenue*P.O. Box 1988
    
    Stillwater, Oklahoma 74076
    
    405-372-2230Waterford Branch6301 Waterford Blvd., Suite 101*
    
    Oklahoma City, Oklahoma 73118
    
    405-427-4000South OKC Branch8101 S. Walker Ave., Suite B
    
    Oklahoma City, Oklahoma 73139
    
    405-427-4000Edmond Branch1440 S. Bryant Avenue*
    
    Edmond, Oklahoma 73034
    
    405-427-4000Chickasha Branch500 W. Grand Avenue
    
    Chickasha, Oklahoma 73018
    
    405-427-3100Tulsa Utica Branch1500 S. Utica AvenueP.O. Box 521500
    
    Tulsa, Oklahoma 74152
    
    918-523-3600Tulsa 61st Branch2431 E. 61st, Suite 170*P.O. Box 521500
    
    Tulsa, Oklahoma 74152
    
    918-523-3600SNB McMullen Bank-Tilden Branch205 Elm StreetP.O. Box 299
    
    Tilden, Texas 78072
    
    361-274-3391SNB Bank of Dallas  Frisco5300 Town and Country Blvd., Suite 100*
    
    Frisco, Texas 75034
    
    972-624-2900SNB Bank of Dallas-Preston Center5950 Berkshire Lane, Suite 350*
    
    Dallas, Texas 75225
    
    972-624-2900SNB Bank of Austin3900 N. Capital of Texas HWY, Suite 100*
    
    Austin, Texas 78746
    
    512-314-6700SNB Bank of San Antonio-Stone Oak Branch777 E. Sonterra Blvd, Suite 190*
    
    San Antonio, Texas 78258
    
    210-442-6100SNB Bank of San Antonio-Medical Hill Branch9324 Huebner Road
    
    San Antonio, Texas 78240
    
    210-442-6100Stillwater National Bank Loan Production Office10111 Richmond Avenue Suite 132*
    
    Houston, Texas 77042
    
    713-268-8900Stillwater National Bank Loan Production Office11350 Tomahawk Creek Parkway, Suite 100*
    
    Leawood, Kansas 66211
    
    913-906-4400
 95




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##### Table of Contents



OUHSC Loan Production Office1106 N. Stonewall*
    
    Oklahoma City, Oklahoma 73117
    
    405-271-3113OSU-Stillwater Marketing OfficeStudent Union, Room 150*P.O. Box 1988
    
    Stillwater, Oklahoma 74076
    
    405-744-5962
 
 *
    
    Leased from third parties. Other properties are owned. 96




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PART IV
 
  Documents Filed as Part of this Report
 Financial Statements
        Financial Statement Schedules
 Exhibits
 No.
    
    Exhibit3.1
    
    Amended and Restated Certificate of Incorporation of Southwest Bancorp, Inc. (incorporated by reference to Exhibit
3.1 to Quarterly Report on Form 10-Q for the quarter ended June 30, 2008)3.2
    
    Bylaws of Southwest Bancorp, Inc., as amended (incorporated by reference to Exhibit 3.2 to Current Report on Form
8-K filed November 19, 2007)4.1
    
    Rights Agreement, dated as of April 22, 1999, between Southwest Bancorp, Inc. and Harris Trust & Savings Bank, as
rights agent and Form of Certificate of Designations setting forth terms of Class B, Series 1 Preferred Stock of
Southwest Bancorp, Inc. referred to in the rights agreement (incorporated by reference to Exhibits 1 and 2 to
Current Report on Form 8-K dated April 22, 1999)4.2
    
    Amendment No. 1 to Rights Agreement, dated as of December 2, 2008, between Southwest Bancorp, Inc. and Computershare
Trust Company, N.A., as rights agent (incorporated by reference to Exhibit 4.2 to Current Report on Form 8-K filed
December 8, 2008)4.3
    
    Certificate of Designations for Fixed Rate Cumulative Perpetual Preferred Stock, Series B (incorporated by reference
to Exhibit 4.1 to Current Report on Form 8-K filed December 8, 2008)4.4
    
    Letter Agreement, dated as of December 5, 2008, between Southwest Bancorp, Inc. and the United States Department of
Treasury (incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K filed December 8, 2008)* 10.1
    
    Southwest Bancorp, Inc. Employee Stock Purchase Plan (incorporated by reference to Exhibit 4.1 to Registration
Statement on Form S-8 (File No. 33-97850))* 10.2
    
    Southwest Bancorp, Inc. and Affiliates Amended and Restated Severance Compensation Plan (incorporated by reference
to Exhibit 10.6 to Current Report on Form 8-K filed January 2, 2008)* 10.3
    
    Southwest Bancorp, Inc. 1994 Stock Option Plan (incorporated by reference to Exhibit 10.3 to Annual Report on Form
10-K for the fiscal year ended December 31, 1993)* 10.4
    
    Southwest Bancorp, Inc. 1999 Stock Option Plan as Amended and Restated (incorporated by
 97




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No.
    
    Exhibitreference to Exhibit 10 to
Quarterly Report on Form 10-Q for the quarter ended June 30, 2007)* 10.5
    
    Stillwater National Bank and Trust Company 2002 and 2003 Deferred Compensation Plans (incorporated by reference to
Exhibit 10.5 to Annual Report on Form 10-K for the fiscal year ended December 31, 2002)* 10.6
    
    Stillwater National Bank and Trust Company Amended and Restated Supplemental Profit Sharing Plan for Rick Green
(incorporated by reference to Exhibit 10.3 to Current Report on Form 8-K filed January 2, 2008)* 10.7
    
    Stillwater National Bank and Trust Company Amended and Restated Supplemental Profit Sharing Plan for Kerby E.
Crowell (incorporated by reference to Exhibit 10.4 to Current Report on Form 8-K filed January 2, 2008)* 10.8
    
    Stillwater National Bank and Trust Company Amended and Restated Supplemental Profit Sharing Plan for Jerry L. Lanier
(incorporated by reference to Exhibit 10.5 to Current Report on Form 8-K filed January 2, 2008)10.9
    
    Indemnification Agreements by and between Southwest Bancorp, Inc. and James E. Berry II, Thomas D. Berry, Joe Berry
Cannon, J. Berry Harrison, Erd M. Johnson, David P. Lambert, Linford R. Pitts, Robert B. Rodgers, Russell W.
Teubner, John Cohlmia, and Anthony W. Martin (incorporated by reference to Exhibit 10.9 to Annual Report on Form
10-K for the fiscal year ended December 31, 2005)10.10
    
    Indemnification Agreements by and between Southwest Bancorp, Inc. and Rick Green, Kerby E. Crowell, David Dietz,
Allen Glenn, Steve Gobel, Steven N. Hadley, Jerry L. Lanier, Randy Mills, Kimberly Sinclair, Kay Smith, and Charles
H. Westerheide (incorporated by reference to Exhibit 10.10 to Annual Report on Form 10-K for the fiscal year ended
December 31, 2005)10.11
    
    Indemnification Agreements by and between Southwest Bancorp, Inc. and David S. Crockett, Jr. (incorporated by
reference to Exhibit 10(a) to Quarterly Report on Form 10-Q for the quarter ended September 30, 2006)10.12
    
    Indemnification Agreements by and between Southwest Bancorp, Inc. and James M. Johnson (incorporated by reference to
Exhibit 10(b) to Quarterly Report on Form 10-Q for the quarter ended September 30, 2006)* 10.13
    
    2007 Directors Deferred Compensation Plan by and between Southwest Bancorp, Inc. and James M. Johnson (incorporated by
reference to Exhibit 10 to Current Report on Form 8-K dated December 28, 2006)* 10.14
    
    Amendment to 2007 Directors Deferred Compensation Plan by and between Southwest Bancorp, Inc. and James M. Johnson
(incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K filed January 2, 2008)10.15
    
    Audit Committee Financial Expert Agreement by and between Southwest Bancorp, Inc. and David S. Crockett, Jr.
(incorporated by reference to Exhibit 10.15 to Annual Report on Form 10-K for the fiscal year ended December 31,
2006)* 10.16
    
    2008 Directors Deferred Compensation Plan by and between Southwest Bancorp, Inc. and James M. Johnson (incorporated by
reference to Exhibit 10.2 to Current Report on Form 8-K filed January 2, 2008)* 10.17
    
    Southwest Bancorp, Inc. 2008 Stock Based Award Plan (incorporated by reference to Exhibit 10.1 to Quarterly Report on Form
10-Q for the quarter ended June 30, 2008)* 10.18
    
    Southwest Bancorp, Inc. Form of Restricted Stock Agreement Amendments (incorporated by reference to Exhibit 10.2 to Quarterly
Report on Form 10-Q for the quarter ended June 30, 2008)* 10.19
    
    Southwest Bancorp, Inc. Form of Omnibus Compensation Compliance Agreement and Waivers dated December 5, 2008 (incorporated by
reference to Exhibit 10.19 to Annual Report on Form 10-K for the fiscal year ended December 31, 2008)10.20
    
    Written agreement between Stillwater National Bank and Trust Company and the Comptroller of the Currency of the
United States dated January 27, 2010 (incorporated by
reference to Exhibit 10 to Current Report on Form 8-K filed January 29, 2010)21
    
    Subsidiaries of the Registrant23
    
    Consent of Independent Registered Public Accounting Firm24
    
    Power of Attorney31(a), (b)
    
    Rule 13a-14(a)/15d-14(a) Certifications32(a), (b)
    
    18 U.S.C. Section 1350 Certifications
 98




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No.
    
    Exhibit99(a), (b)
    
    Certifications by the Principal Executive Officer and Principal Financial Officer pursuant to Section 111 (b) (4) of
the Emergency Economic Stabilization Act of 2008 as amended by the American Recovery and Reinvestment Act of 2009
 
 *
    
    Management contract or compensatory plan or arrangement required to be filed pursuant to Item 14(c) of Form 10-K. 99




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SIGNATURES
  SOUTHWEST BANCORP, INC.March 5, 2010

by:
/s/ Rick GreenRick GreenChief Executive Officer  /s/ Rick Green

Rick Green
    
    March 5, 2010Director and Chief Executive Officer(Principal Executive Officer)/s/ Kerby E. Crowell
    
    March 5, 2010Kerby E. CrowellExecutive Vice President,Chief Financial Officer and Secretary(Principal Financial andAccounting Officer)
  By:
    /s/ Rick GreenRick GreenAttorney-in-Fact for Majority of the
Directors of Southwest 100