banf-10q_20210630.htm

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐.

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (sec. 232-405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐.

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined by Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of July 30, 2021 there were 32,784,513 shares of the registrant’s Common Stock outstanding.

	June 30,			December 31,
		2021			2020
	(unaudited)			(see Note 1)
ASSETS
Cash and due from banks	$	268,299		$	280,518
Interest-bearing deposits with banks		3,373,099			1,336,394
Debt securities held for investment (fair value: $2,990 and $2,984, respectively)		2,988			2,964
Debt securities available for sale at fair value		560,783			552,232
Loans held for sale		16,032			53,719
Loans held for investment (net of unearned interest)		6,191,230			6,394,506
Allowance for credit losses		(83,963	)		(91,366	)
Loans, net of allowance for credit losses		6,107,267			6,303,140
Premises and equipment, net		267,284			261,677
Other real estate owned		40,130			32,179
Intangible assets, net		19,283			18,999
Goodwill		149,922			149,922
Accrued interest receivable and other assets		210,200			220,613
Total assets	$	11,015,287		$	9,212,357

LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Noninterest-bearing	$	4,475,941		$	3,790,900
Interest-bearing		5,252,448			4,273,804
Total deposits		9,728,389			8,064,704
Short-term borrowings		3,100			1,100
Accrued interest payable and other liabilities		66,248			51,864
Subordinated debt		85,959			26,804
Total liabilities		9,883,696			8,144,472

Stockholders' equity:
Senior preferred stock, $1.00 par; 10,000,000 shares authorized; none issued		—			—
Cumulative preferred stock, $5.00 par; 900,000 shares authorized; none issued		—			—
Common stock, $1.00 par, 40,000,000 shares authorized; shares issued and outstanding: 32,784,513 and 32,719,852, respectively		32,785			32,720
Capital surplus		158,322			156,574
Retained earnings		935,067			871,161
Accumulated other comprehensive income, net of income tax of $1,705 and $2,513, respectively		5,417			7,430
Total stockholders' equity		1,131,591			1,067,885
Total liabilities and stockholders' equity	$	11,015,287		$	9,212,357

The accompanying Notes are an integral part of these consolidated financial statements.

	Three Months Ended						Six Months Ended
	June 30,						June 30,
		2021			2020			2021			2020
INTEREST INCOME
Loans, including fees	$	82,447		$	78,855		$	160,109		$	155,373
Securities:
Taxable		1,602			2,047			3,295			4,633
Tax-exempt		70			154			140			252
Interest-bearing deposits with banks		825			395			1,420			5,164
Total interest income		84,944			81,451			164,964			165,422
INTEREST EXPENSE
Deposits		2,003			3,750			4,325			13,150
Short-term borrowings		—			1			1			8
Subordinated debt		578			492			1,069			983
Total interest expense		2,581			4,243			5,395			14,141
Net interest income		82,363			77,208			159,569			151,281
(Benefit from) provision for credit losses		(9,949	)		19,333			(9,949	)		38,916
Net interest income after (benefit from)/provision for credit losses		92,312			57,875			169,518			112,365
NONINTEREST INCOME
Trust revenue		3,264			3,368			6,366			7,023
Service charges on deposits		20,524			16,760			39,624			35,564
Securities transactions (includes no accumulated other comprehensive income reclassifications)		172			(595	)		267			(545	)
Income from sales of loans		2,133			1,561			4,143			2,342
Insurance commissions		5,015			4,443			11,004			10,119
Cash management		3,068			4,255			6,071			8,575
Gain on sale of other assets		73			49			2,712			135
Other		10,369			2,241			14,366			4,014
Total noninterest income		44,618			32,082			84,553			67,227
NONINTEREST EXPENSE
Salaries and employee benefits		41,992			42,226			81,569			81,982
Occupancy, net		4,528			3,839			8,876			7,385
Depreciation		4,133			3,544			8,010			7,035
Amortization of intangible assets		809			968			1,602			1,932
Data processing services		1,660			1,629			3,338			3,321
Net loss/(income) from other real estate owned		3,357			(12	)		4,867			(2,147	)
Marketing and business promotion		1,648			1,485			3,527			3,840
Deposit insurance		766			365			1,642			501
Other		15,130			10,607			25,555			22,187
Total noninterest expense		74,023			64,651			138,986			126,036
Income before taxes		62,907			25,306			115,085			53,556
Income tax expense		14,715			4,576			24,373			10,218
Net income	$	48,192		$	20,730		$	90,712		$	43,338
NET INCOME PER COMMON SHARE
Basic	$	1.47		$	0.64		$	2.77		$	1.33
Diluted	$	1.45		$	0.63		$	2.72		$	1.31
OTHER COMPREHENSIVE (LOSS) GAIN
Unrealized (losses)/gains on debt securities, net of tax of $472, $85, $808 and $(2,091) respectively		(1,007	)		(189	)		(2,013	)		6,236
Comprehensive income	$	47,185		$	20,541		$	88,699		$	49,574

The accompanying Notes are an integral part of these consolidated financial statements.

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2021		2020		2021			2020
COMMON STOCK
Issued at beginning of period	$	32,771	$	32,647	$	32,720		$	32,694
Shares issued for stock options		14		16		65			28
Shares acquired and canceled		—		—		—			(59	)
Issued at end of period	$	32,785	$	32,663	$	32,785		$	32,663
CAPITAL SURPLUS
Balance at beginning of period	$	157,450	$	153,999	$	156,574		$	153,353
Common stock issued for stock options		399		287		1,657			507
Net cash settlement of options		—		—		(958	)		—
Stock-based compensation arrangements		473		406		1,049			832
Balance at end of period	$	158,322	$	154,692	$	158,322		$	154,692
RETAINED EARNINGS
Balance at beginning of period	$	898,026	$	826,855	$

Oklahoma		73-1221379
(State or other Jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

100 N. Broadway Ave., Oklahoma City, Oklahoma		73102-8405
(Address of principal executive offices)		(Zip Code)

Item		Page
	PART I – Financial Information
1.	Financial Statements (Unaudited)	2
	Consolidated Balance Sheets	2
	Consolidated Statements of Comprehensive Income	3
	Consolidated Statements of Shareholders’ Equity	4
	Consolidated Statements of Cash Flow	5

	Notes to Consolidated Financial Statements	6
2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	30
3.	Quantitative and Qualitative Disclosure About Market Risk	40
4.	Controls and Procedures	40

	PART II – Other Information
1.	Legal Proceedings	41
1A.	Risk Factors	41
2.	Unregistered Sales of Equity Securities	41
3.	Defaults Upon Senior Securities	41
4.	Mine Safety Disclosures	41
5.	Other Information	41
6.	Exhibits	42
Signatures		44

Large accelerated filer	☒	Accelerated filer	☐

Non-accelerated filer	☐	Smaller reporting company	☐

Emerging growth company	☐