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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MARCH 27, 1996
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1995 COMMISSION FILE NO. 0-19341
BOK FINANCIAL CORPORATION
INCORPORATED IN THE STATE I.R.S. EMPLOYER IDENTIFICATION
OF OKLAHOMA NO.73-1373454
Bank of Oklahoma Tower
P.O. Box 2300
Tulsa, Oklahoma 74192
Registrant's Telephone Number,
Including Area Code (918) 588-6000
SECURITIES REGISTERED PURSUANT TO SECTION 12(b)
OF THE ACT: (NONE)
SECURITIES REGISTERED PURSUANT TO SECTION 12(g)
OF THE ACT:
COMMON STOCK ($.00006 Par Value)
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 X No
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-X is not contained herein, and will not be contained, to the
best of Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ ]
State the aggregate market value of the voting stock held by non-affiliates of
the Registrant: $90,716,315 as of February 29, 1996.
Indicate the number of shares outstanding of each of the Registrant's classes of
common stock, as of the latest practicable date: 20,435,826 shares of common
stock ($.00006 par value) as of February 29, 1996.
List hereunder the following documents if incorporated by reference and the
part of Form 10-K in which the document is incorporated:
Part I - Annual Report to Shareholders For Fiscal Year Ended December 31,
1995 (designated portions only)
Part II - Annual Report to Shareholders For Fiscal Year Ended December 31,
1995 (designated portions only)
Part III - Proxy Statement for Annual Meeting of Shareholders scheduled
for April 30, 1996 (designated portions only)
Part IV - Annual Report to Shareholders For Fiscal Year Ended December 31,
1995 (designated portions only)
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BOK FINANCIAL CORPORATION
FORM 10-K ANNUAL REPORT
INDEX
ITEM PAGE
- ---- ----
PART I
1. Business 2
2. Properties 7
3. Legal Proceedings 7
4. Submission of Matters to a Vote of Security Holders 7
PART II
5. Market for Registrant's Common Equity and Related
Stockholder Matters 7
6. Selected Financial Data 8
7. Management's Discussion and Analysis of Financial
Condition and Results of Operations 8
8. Financial Statements and Supplementary Data 8
9. Changes in and Disagreements with Accountants
on Accounting and Financial Disclosure 8
PART III
10. Directors and Executive Officers of the Registrant 8
11. Executive Compensation 8
12. Security Ownership of Certain Beneficial Owners
and Management 8
13. Certain Relationships and Related Transactions 8
PART IV
14. Exhibits, Financial Statement Schedules and Reports
on Form 8-K 9-13
Signatures 14
BOK FINANCIAL CORPORATION
PART I
ITEM 1 - BUSINESS
GENERAL DEVELOPMENT OF BUSINESS
BOK Financial Corporation ("BOK Financial") was incorporated under the laws of
the State of Oklahoma on October 24, 1990. Active operations as a bank holding
company commenced on June 7, 1991 with the acquisition of the preferred stock
("BOk Preferred Stock") of Bank of Oklahoma, National Association ("BOk") from
the Federal Deposit Insurance Corporation ("FDIC") and the conversion of the BOk
Preferred Stock into 99.99% of the common stock of BOk. BOK Financial is
regulated by the Board of Governors of the Federal Reserve System pursuant to
the Bank Holding Company Act of 1956, as amended ("BHCA").
BOK Financial operates primarily through BOk, BOk's subsidiaries and Citizens
Bank of Northwest Arkansas, National Association ("CBNWA"). The existing and
future activities of BOK Financial and its subsidiaries are limited by the BHCA,
which prohibits a bank holding company from engaging in any business other than
banking, managing or controlling banks, and furnishing and performing certain
bank-related services and activities.
On June 7, 1991, BOK Financial paid $60.75 million to the FDIC for the BOk
Preferred Stock. To finance this acquisition, BOK Financial issued preferred
stock totaling $15.0 million at $6.00 per share and common stock ("Common
Stock") totaling $46.0 million at $5.75 per share to George B. Kaiser
("Kaiser"), BOK Financial's principal shareholder. Kaiser purchased an
additional $10.0 million to BOK Financial Common Stock at $5.75 per share, and
BOK Financial contributed the $10.0 million to BOk as additional capital. Per
share amounts reflect a 1-for-100 reverse stock split effective December 17,
1991 ("reverse stock split").
Following a bidding process conducted by the Resolution Trust Corporation
("RTC"), BOK Financial, through the mortgage banking subsidiary of BOk,
BancOklahoma Mortgage Corp. ("BOMC"), acquired on June 10, 1991 approximately
$1.0 billion of mortgage servicing rights and certain other assets of Maxim
Mortgage Corporation ("Maxim"). Maxim was formerly a subsidiary of Sooner
Federal Savings and Loan Association, which had failed and had been placed under
the control of the RTC.
Also following a bidding process by the RTC, BOK Financial acquired on August
9, 1991 certain assets and assumed certain liabilities, primarily deposits, of
eight branches of Continental Federal Savings and Loan Association of Oklahoma
City, Oklahoma. BOK Financial assumed deposits of approximately $214.5 million
and paid the RTC a premium of $4.1 million. Kaiser acquired an additional $20.0
million of BOK Financial's Common Stock at $5.75 per share (after effect of the
reverse stock split), and BOK Financial contributed the $20.0 million to BOk to
facilitate the purchase.
On March 27, 1992, CBNWA acquired certain assets and assumed the deposits and
certain obligations of two branches of the failed Home Federal Savings & Loan
Association from the RTC for $1.1 million.
On July 16, 1992, Bank of Oklahoma, N.A., South, an unconsolidated banking
subsidiary, was merged into BOk.
On November 13, 1992, BOK Financial purchased Southwest Trustcorp, Inc. and its
subsidiary, The Trust Company of Oklahoma, Oklahoma City, in exchange for
400,000 shares of Common Stock valued at $4.6 million.
On December 31, 1992, BOK Financial acquired certain assets and assumed $502.9
million of deposits and other liabilities of 19 branches of the Sooner Division
of First Gibraltar Bank, FSB of Irving, Texas for a purchase price of $16.5
million.
On May 7, 1993, BOK Financial issued 343,295 common shares valued at $6.9
million and paid $3.9 million to acquire Sand Springs Bancshares, Inc. and its
subsidiary, Sand Springs State Bank.
Also on May 7, 1993, BOK Financial issued 1,183,691 common shares to acquire
Brookside Bancshares, Inc. and its subsidiary, Brookside State Bank, in a
pooling-of-interests transaction. Financial information of BOK Financial for
1992 and 1991 has been restated to reflect this acquisition.
On October 9, 1993, BOK Financial acquired certain assets and assumed the
deposits and certain obligations of two branches of the failed Heartland Federal
Savings & Loan Association from the FDIC for $5.1 million.
On May 2, 1994, BOK Financial acquired Plaza National Bank, Bartlesville,
Oklahoma for $11.7 million.
On June 13, 1994, BOK Financial acquired Texas Commerce Trust Company -
Sherman, National Association, Sherman, Texas, a national association limited to
trust powers only, for $6.1 million.
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BOK FINANCIAL CORPORATION
On October 7, 1994, BOK Financial acquired Northwest Bank of Enid, Enid,
Oklahoma for $8.2 million.
On November 14, 1994, BOK Financial issued 1,380,017 common shares to acquire
Citizens Holding Company and its subsidiaries, Citizens Bank of Muskogee and
Citizens Bank of Northwest Arkansas, in a pooling-of-interests. Financial
information of BOK Financial for 1993 and 1992 has been restated to reflect this
acquisition.
Developments relating to individual aspects of the business of BOK Financial
are described under "Narrative Description of Business" on pages 3 and 4 of this
report. Additional discussion of BOK Financial's activities during the current
year is incorporated by reference to "Management's Assessment of Operations and
Financial Condition" (pages 6-20) in BOK Financial's 1995 Annual Report to
Shareholders. Additional information regarding BOK Financial's acquisitions is
incorporated by reference to Note 2 of "Notes to Consolidated Financial
Statements" (page 29) in BOK Financial's 1995 Annual Report to Shareholders.
NARRATIVE DESCRIPTION OF BUSINESS
BOK Financial is a bank holding company, and as such, its activities are
limited by the BHCA to banking, certain bank-related services and activities,
and managing or controlling banks. BOK Financial's banking and bank-related
activities are primarily performed through BOk and CBNWA; nonbank subsidiary
operations are not significant. As of December 31, 1995, BOK Financial and its
subsidiaries had 1,842 full-time equivalent employees. Following is a
description of the more significant services offered by BOK Financial and the
competitive and regulatory environments in which it operates.
SERVICES OFFERED
COMMERCIAL BANKING SERVICES
BOK Financial, through BOk and CBNWA, provides a wide range of financial
services to commercial and industrial customers, including depository, lending
and other financial services such as cash management and international
collections. The loan portfolio is comprised primarily of real estate and
commercial loans. The commercial loan portfolio is diversified and distributed
among various commercial and industrial customers, including energy-related,
manufacturing, trade and service industries.
CORRESPONDENT BANKING SERVICES
BOK Financial provides a broad range of financial services to approximately 350
banks, savings and loans, credit unions and other financial institutions in
Oklahoma and surrounding states. BOK Financial works closely with community
financial institutions, assisting them in satisfying the demands of their
customers and trade areas by engaging in loan participations and providing other
financial services.
CONSUMER BANKING SERVICES
At December 31, 1995, BOk had 62 banking locations, with 48 locations in the
Tulsa and Oklahoma City areas. CBNWA had 4 locations in northwest Arkansas.
Services offered include deposit accounts, installment loans, student loans,
bank card accounts, personal lines of credit, debit cards, an automated 24-hour
telephone loan application service and a 24-hour telephone branch. New products
planned for 1996 include a telephone and personal computer based bill paying
service. The BancOklahoma Investment Center makes available, through
representatives in most BOk branches, a full range of mutual funds, annuities
and securities. TransFund, BOk's network of automated teller machines, consists
of 549 locations across Oklahoma.
INVESTMENT AND MONEY MARKET ACTIVITIES
BOk provides securities brokerage, trading and underwriting services for
corporations, governmental units, individual customers and correspondent banks.
Securities include money market instruments, U.S. Government and municipal
bonds, corporate stocks and bonds, and mutual funds. The public finance
department provides financial advisory, private placement and term-financing
services for governmental and corporate entities.
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BOK FINANCIAL CORPORATION
MORTGAGE BANKING
BOMC, through its own locations as well as BOk's branch network, offers a full
array of mortgage options from federally sponsored programs to "jumbo loans" on
higher priced houses. BOMC is the largest originator of mortgage loans in
Oklahoma and has a servicing portfolio of approximately $5.4 billion, including
$253 million serviced for BOk.
TRUST AND ASSET MANAGEMENT SERVICES
BOk's trust subsidiaries (BancOklahoma Trust Company ("BOTC") in Oklahoma and
Alliance Trust Company N.A. in Texas) offer a variety of services to both
corporate and individual customers in Oklahoma and Texas. Individual financial
trust services include personal trust management, administration of estates and
management of individual investment and custodial accounts. For corporate
clients, the services include management, administration and recordkeeping of
pension plans, thrift plans, 401(k) plans and master trust plans, including a
state-of-the-art system for employee benefit plan recordkeeping. BOk's trust
division also serves as transfer agent and registrar for corporate securities,
paying agent for municipalities and governmental agencies and indenture trustee
of bond issues. BOTC serves as an investment advisor to the American Performance
Funds, a family of proprietary mutual funds distributed by the Winsbury Company
of Columbus, Ohio. At December 31, 1995, trust subsidiaries were responsible for
approximately $7.6 billion in assets.
FOREIGN OPERATIONS
BOK Financial does not engage in operations in foreign countries, nor does it
lend to foreign governments.
COMPETITION
The banking industry in Oklahoma is highly competitive. BOK Financial competes
with other banks in obtaining deposits, making loans and providing additional
services related to banking. There are approximately 346 banks located in
Oklahoma, of which approximately 40 are located in the Tulsa County metropolitan
surrounding area and approximately 58 are located in the Oklahoma County
metropolitan surrounding area. BOK Financial is also in competition with other
businesses engaged in extending credit or accepting deposits, such as major
retail establishments, major brokerage houses, savings and loan associations,
credit unions, finance companies, small loan companies, insurance companies and
loan production offices of major banks located within and outside Oklahoma.
Limited branch banking as permitted in Oklahoma is increasing competition.
Generally, a bank may establish two new branch offices within the town or city
where the bank is located or in nearby areas not already served by a bank or
branch, and may acquire an unlimited number of existing banks and convert them
and their branches into branch offices. Within its primary markets, BOk has 25
locations in the Tulsa area and 23 locations in the Oklahoma City area, the
state's largest financial markets. Subject to regulatory approval, BOk is
considering various locations for additional facilities. Like BOk, other banks
are taking advantage of the bank branching laws to establish additional
facilities. These additional banking offices are further increasing competition.
Limited branch banking is, on the other hand, permitting banks to compete more
effectively with savings and loan associations, credit unions and other
financial institutions that may establish offices more freely than banks, some
of which are not subject to regulatory restrictions on their activities.
Oklahoma also permits the acquisition of an unlimited number of wholly-owned
bank subsidiaries so long as aggregate deposits at the time of acquisition in a
multibank holding company do not exceed 11% of all deposits in Oklahoma
financial institutions insured by the federal government. Based on the latest
statistical data available (as of June 30, 1995), BOK Financial could acquire
additional bank subsidiaries so long as the aggregate deposits of all Oklahoma
subsidiaries do not exceed approximately $3.9 billion. Consolidated deposits of
BOK Financial were $2.7 billion and $2.9 billion at June 30, and December 31,
1995, respectively.
Oklahoma also permits out-of-state bank holding companies to acquire banks and
bank holding companies located in the state and, subject to certain limitations,
make additional acquisitions within the state. Over the last few years, one
national and two regional bank holding companies have entered the Oklahoma
market which has resulted in the consolidation of the Oklahoma banking industry
into fewer but larger banks. This concentration has significantly increased
competition for both commercial and consumer customers as more organizations are
providing a greater number of products and services to the customer.
4
BOK FINANCIAL CORPORATION
On September 29, 1994, the Riegle-Neal Interstate Banking and Branching
Efficiency Act of 1994 ("Riegle-Neal") was signed into law. In summary,
commencing one year after passage, qualifying bank holding companies will be
permitted to acquire banks in any state. As of June 1, 1997, qualifying banks
may be able to engage in interstate branching by merging banks in different
states. States may opt out of interstate branching by enacting specific
legislation prior to June 1, 1997, in which case out-of-state banks would
generally not be able to branch into that state, and banks headquartered in that
state would not be permitted to branch into other states. States may also opt
into interstate branching earlier than 1997 with specific legislation. The law
imposes a 10% nationwide deposit cap and a 30% state cap; however, the states'
authority is preserved to impose a lower, nondiscriminatory deposit cap (such as
Oklahoma's 11% cap, discussed on page 4). Early opt in legislation must apply
equally to all out-of-state banks and permit interstate merger transactions with
all out-of-state banks. Legislation to opt in early has been passed by the
Oklahoma House of Representatives and, as of this date, is expected to be
considered by the Senate during 1996. If enacted, it is anticipated that the
total number of Oklahoma banks may decrease and national and regional bank
presence in the state may increase. Over the near-term, these changes are
expected to increase competition with a greater number of products and services
available to Oklahoma customers. Over the long-term, the number of competitors
could decrease, depending on the extent of consolidations nationwide, but
competition could continue to increase as a result of the remaining institutions
needing to be stronger, more innovative and more aggressive to retain a
significant presence in a consolidated environment.
Additional legislation, judicial and administrative decisions also may affect
the ability of banks to compete with each other as well as with other
businesses. These statutes and decisions may tend to make the operations of
various financial institutions more similar and increase competition among banks
and other financial institutions or limit the ability of banks to compete with
other businesses. Management currently cannot predict whether and, if so, when
any such changes might occur or the impact any such changes would have upon the
income or operations of BOK Financial or its subsidiaries, or upon the Oklahoma
regional banking environment.
SUPERVISION AND REGULATION
Bank holding companies and banks are extensively regulated under both federal
and state law. The following information, to the extent it describes statutory
or regulatory provisions, is qualified in its entirety by reference to the
particular statutory and regulatory provisions. It is not possible to predict
the changes, if any, that may be made to existing banking laws and regulations
or whether such changes, if made, would materially adversely affect the business
and prospects of BOK Financial, BOk and CBNWA.
BOK FINANCIAL
As a bank holding company, BOK Financial is subject to regulation under the
BHCA and to supervision by the Board of Governors of the Federal Reserve System
(the "Reserve Board"). Under the BHCA, BOK financial is required to file with
the Reserve Board an annual report and such other additional information as the
Reserve Board may require. The Reserve Board may also make examinations of BOK
Financial and its subsidiaries.
The BHCA requires the prior approval of the Reserve Board in any case where a
bank holding company proposes to acquire control of more than five percent of
the voting shares of any bank, unless it already controls a majority of such
voting shares. Additionally, approval must also be obtained before a bank
holding company may acquire all or substantially all of the assets of another
bank or before it may merge or consolidate with another bank holding company.
The BHCA further provides that the Reserve Board shall not approve any such
acquisition, merger or consolidation that will substantially lessen competition,
tend to create a monopoly or be in restraint of trade, unless it finds the anti-
competitive effects of the proposed transaction are clearly outweighed in the
public interest by the probable effect of the transaction in meeting the
convenience and needs of the community to be served.
The BHCA presently prohibits the Reserve Board from approving an application
from a bank holding company to acquire shares of a bank located outside the
state in which the operations of the holding company's banking subsidiaries are
principally conducted, unless such an acquisition is specifically authorized by
statute of the state in which the bank whose shares are to be acquired is
located, but Riegle-Neal permits interstate banking as of September 29, 1995, as
discussed above in "Competition".
The BHCA also prohibits a bank holding company, with certain exceptions, from
acquiring more than five percent of the voting shares of any company that is not
a bank and from engaging in any business other than banking or managing or
controlling banks. Under the BHCA, the Reserve Board is authorized to approve
the ownership of shares by a bank holding company in any company whose
activities the Reserve Board has determined to be so closely related to banking
or to managing or controlling banks as to be a proper incident thereto. In
making such determinations, the Reserve Board weighs the Community Reinvestment
Act activities of the bank holding company and the expected benefit to the
public, such as greater convenience, increased competition or gains in
efficiency, against the possible adverse effects, such as undue concentration of
5
BOK FINANCIAL CORPORATION
resources, decreased or unfair competition, conflicts of interest or unsound
banking practices. The Reserve Board has by regulation determined that certain
activities are closely related to banking within the meaning of the BHCA. These
activities include operating a mortgage company, finance company, credit card
company or factoring company; performing certain data processing operations;
servicing loans and other extensions of credit; providing investment and
financial advice; acting as an insurance agent for certain types of credit-
related insurance; owning and operating savings and loan associations; and
leasing personal property on a full-payout, nonoperating basis.
A bank holding and its subsidiaries are further prohibited under the BHCA from
engaging in certain tie-in arrangements in connection with the provision of any
credit, property or services. Thus, a subsidiary of a bank holding company may
not extend credit, lease or sell property, furnish any services or fix or vary
the consideration for these activities on the condition that (1) the customer
obtain or provide some additional credit, property or services from or to the
bank holding company or any subsidiary thereof or (2) the customer may not
obtain some other credit, property or services from a competitor, except to the
extent reasonable conditions are imposed to insure the soundness of credit
extended.
The Federal Deposit Insurance Corporation Improvement Act of 1991 established
five capital rating tiers ranging from "well capitalized" to "critically
undercapitalized". A financial institution is considered to be well capitalized
if its Leverage, Tier 1 and Total Capital ratios are at 5%, 6% and 10%,
respectively. Any institution experiencing significant growth or acquiring other
institutions or branches is expected to maintain capital ratios above the well
capitalized level. At December 31, 1995, BOK Financial's Leverage, Tier 1 and
Total Capital ratios were 6.55%, 9.91% and 11.17%, respectively.
BOK AND CBNWA
BOk and CBNWA are national banking associations and are subject to the National
Banking Act and other federal statutes governing national banks. Under federal
law, the Office of the Comptroller of the Currency ("Comptroller") charters,
regulates and serves as the primary regulator of national banks. In addition,
the Comptroller must approve certain corporate or structural changes, including
an increase or decrease in capitalization, payment of dividends, change of place
of business, establishment of a branch and establishment of an operating
subsidiary. The Comptroller performs its functions through national bank
examiners who provide the Comptroller with information concerning the soundness
of a national bank, the quality of management and directors, and compliance with
applicable laws, rules and regulations. The National Banking Act authorizes the
Comptroller to examine every national bank as often as necessary. Although the
Comptroller has primary supervisory responsibility for national banks, such
banks must also comply with Reserve Board rules and regulations as members of
the Federal Reserve System.
CBNWA is also subject to certain consumer-protection laws incorporated in the
Arkansas Constitution, which, among other restrictions, limit the maximum
interest rate on general loans to five percent above the Federal Reserve
Discount Rate. The rate on consumer loans is five percent above the discount
rate or seventeen percent, whichever is lower.
BOk and CBNWA are insured by the FDIC and are required to pay certain fees and
premiums to the FDIC. The FDIC has implemented a risk-related insurance system
for determining premiums to be paid by a bank. Each bank is placed in one of
nine risk categories based on its level of capital and supervisory rating with
the well-capitalized banks with the highest supervisory rating paying a premium
of 0.00% of deposits (subject to a minimum of $2,000 per year in the absence of
any other assessments) and the critically undercapitalized banks paying up to
0.27% of deposits. Additionally, approximately 25% of BOK Financial's total
deposits at December 31, 1995 were acquired through Oakar transactions and are
insured through the Savings Association Insurance Fund ("SAIF"). While SAIF
premiums currently range from 0.23% to 0.31% of SAIF deposits, depending on
assigned risk category, legislation is pending which will require banks and
savings associations to pay a one-time assessment on all SAIF-insured deposits.
Estimates of the cost of this assessment range from 0.66% to 0.90%. The ultimate
amount and timing of this assessment is subject to the Federal budget
reconciliation process.
Applicable federal statutes and regulations require national banks to meet
certain leverage and risk-based capital requirements. At December 31, 1995,
BOk's and CBNWA's leverage and risk-based capital ratios were well above the
required minimum ratios.
6
BOK FINANCIAL CORPORATION
GOVERNMENTAL POLICIES AND ECONOMIC FACTORS
The operations of BOK Financial and its subsidiaries are affected by
legislative changes and by the policies of various regulatory authorities and,
in particular, the credit policies of the Reserve Board. An important function
of the Reserve Board is to regulate the national supply of bank credit. Among
the instruments of monetary policy used by the Reserve Board to implement its
objectives are: open market operations in U.S. Government securities; changes in
the discount rate on bank borrowings; and changes in reserve requirements on
bank deposits. The effect of such policies in the future on the business and
earnings of BOK Financial and its subsidiaries cannot be predicted with
certainty.
The economy within the State of Oklahoma, BOK Financial's primary market,
continues to show modest improvement. Certain economic indicators show creation
of some 32,400 wage and salary jobs in 1995, the second year in a row in which
Oklahoma has added in excess of 30,000 new jobs (primarily in services, retail
trade and construction). Additionally, while business start-ups and residential
construction for the year are slightly below 1994 levels, they rebounded in the
latter half of 1995 to levels above a year ago. With Oklahoma's economy tied
more closely with the national economy than in the past, however, a downturn in
the national economy could have an adverse impact on BOK Financial's financial
position and results of operations.
ITEM 2 - PROPERTIES
BOK Financial, through BOk, BOk's subsidiaries and CBNWA, owns improved real
estate that was carried at $27.9 million, net of depreciation and amortization,
as of December 31, 1995. BOK Financial conducts its operations through a total
of 62 banking and four nonbanking locations in Oklahoma, four banking locations
in Arkansas and two nonbanking locations in Texas as of December 31, 1995. BOk's
facilities are suitable for their respective uses and present needs.
The information set forth in Notes 6 and 13 of "Notes to Consolidated Financial
Statements" (pages 33 and 38, respectively) of BOK Financial's 1995 Annual
Report to Shareholders provides further discussion related to properties and is
incorporated herein by reference.
ITEM 3 - LEGAL PROCEEDINGS
None.
ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matters were submitted to a vote of security holders, through the
solicitation of proxies or otherwise, during the three months ended December 31,
1995.
PART II
ITEM 5 - MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
BOK Financial's $.00006 par value common stock is traded over-the-counter and
is reported on the facilities of the National Association of Securities Dealers
Automated Quotation system ("NASDAQ"), with the symbol BOKF. At December 31,
1995, common shareholders of record numbered 1,676 with 20,415,504 shares
outstanding.
During 1995, BOK Financial declared a 3% stock dividend in respect of its
Common Stock payable in shares of Common Stock. The dividend was payable on
November 27, 1995 to shareholders of record on November 17, 1995. BOK
Financial's quarterly market information follows:
First Second Third Fourth
------------------------------------
1995:
Low $19.75 $20.25 $21.50 $19.00
High 22.25 22.75 25.25 24.50
1994:
Low $20.50 $19.00 $19.00 $19.25
High 25.50 21.50 22.00 20.50
7
BOK FINANCIAL CORPORATION
The information set forth under the captions "Table 1 - Consolidated Selected
Financial Data" (page 5), "Table 5 - Selected Quarterly Financial Data" (page
11) and Note 15 of "Notes to Consolidated Financial Statements" (page 40) of BOK
Financial's 1995 Annual Report to Shareholders is incorporated herein by
reference.
ITEM 6 - SELECTED FINANCIAL DATA
The information set forth under the caption "Table 1 - Consolidated Selected
Financial Data" (page 5) of BOK Financial's 1995 Annual Report to Shareholders
is incorporated herein by reference.
ITEM 7 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The information set forth under the captions "Management's Assessment of
Operations and Financial Condition" (pages 6-20), "Annual Financial Summary -
Unaudited" (pages 44-45) and "Quarterly Financial Summary - Unaudited" (pages
46-47) of BOK Financial's 1995 Annual Report to Shareholders is incorporated
herein by reference.
ITEM 8 - FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The supplementary data regarding quarterly results of operations set forth
under the caption "Table 5 - Selected Quarterly Financial Data" (page 11) of BOK
Financial's 1995 Annual Report to Shareholders is incorporated herein by
reference.
ITEM 9 - CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
None.
PART III
ITEM 10 - DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The information set forth under the captions "Election of Directors" and
"Executive Compensation" in BOK Financial's 1996 Annual Proxy Statement for its
Annual Meeting of Shareholders scheduled for April 30, 1996 ("1996 Annual Proxy
Statement") is incorporated herein by reference.
ITEM 11 - EXECUTIVE COMPENSATION
The information set forth under the caption "Executive Compensation" in BOK
Financial's 1996 Annual Proxy Statement is incorporated herein by reference.
ITEM 12 - SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The information set forth under the captions "Security Ownership of Certain
Beneficial Owners and Management" and "Election of Directors" in BOK Financial's
1996 Annual Proxy Statement is incorporated herein by reference.
ITEM 13 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The information set forth under the caption "Certain Transactions" in BOK
Financial's 1996 Annual Proxy Statement is incorporated herein by reference.
The information set forth under Notes 3, 5 and 9 of "Notes to Consolidated
Financial Statements" (pages 29, 32-33 and 35, respectively) of BOK Financial's
1995 Annual Report to Shareholders is incorporated herein by reference.
8
BOK FINANCIAL CORPORATION
PART IV
ITEM 14 - EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
(A)(1) LIST OF FINANCIAL STATEMENTS FILED.
The following financial statements and reports included in BOK Financial's
Annual Report to Shareholders for the Fiscal Year Ended December 31, 1995 are
incorporated by reference in Parts I and II of this Annual Report on Form 10-K.
EXHIBIT 13
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1995 ANNUAL REPORT
DESCRIPTION PAGE NUMBER
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Consolidated Selected Financial Data 5
Selected Quarterly Financial Data 11
Report of Management on Financial 21
Statements
Report of Independent Auditors 21
Consolidated Statements of Earnings 22
Consolidated Balance Sheets 23
Consolidated Statements of Changes in 24-25
Shareholders' Equity
Consolidated Statements of Cash Flows 26
Notes to Consolidated Financial 27-43
Statements
Annual Financial Summary - Unaudited 44-45
Quarterly Financial Summary - Unaudited 46-47
Appendix A 49-50
(A)(2) LIST OF FINANCIAL STATEMENT SCHEDULES FILED.
The schedules to the consolidated financial statements required by Regulation
S-X are not required under the related instructions or are inapplicable and are
therefore omitted.
(A)(3) LIST OF EXHIBITS FILED.
Exhibit Number Description of Exhibit
- -------------- ----------------------
3.0 The Articles of Incorporation of BOK Financial,
incorporated by reference to (i) Amended and
Restated Certificate of Incorporation of BOK
Financial filed with the Oklahoma Secretary of
State on May 28, 1991, filed as Exhibit 3.0 to S-1
Registration Statement No. 33-90450, and (ii)
Amendment attached as Exhibit A to Information
Statement and Prospectus Supplement filed November
20, 1991.
3.1 Bylaws of BOK Financial, incorporated by reference
to Exhibit 3.1 of S-1 Registration Statement No.
33-90450.
4.0 The rights of the holders of the Common Stock and
Preferred Stock of BOK Financial are set forth in
its Certificate of Incorporation.
10.0 Purchase and Sale Agreement dated October 25,
1990, among BOK Financial, Kaiser, and the FDIC,
incorporated by reference to Exhibit 2.0 of S-1
Registration Statement No. 33-90450.
9
BOK FINANCIAL CORPORATION
10.1 Amendment to Purchase and Sale Agreement effective
March 29, 1991, among BOK Financial, Kaiser, and
the FDIC, incorporated by reference to Exhibit 2.2
of S-1 Registration Statement No. 33-90450
10.2 Letter agreement dated April 12, 1991, among BOK
Financial, Kaiser, and the FDIC, incorporated by
reference to Exhibit 2.3 of S-1 Registration
Statement No. 33-90450.
10.3 Second Amendment to Purchase and Sale Agreement
effective April 15, 1991, among BOK Financial,
Kaiser, and the FDIC, incorporated by reference to
Exhibit 2.4 of S-1 Registration Statement No.
33-90450.
10.4 Employment agreements.
10.4(a) Employment Agreement between BOk and Stanley A.
Lybarger, incorporated by reference to Exhibit
10.4(a) of Form 10-K for the fiscal year ended
December 31, 1991.
10.5 Director indemnification agreement dated June 30,
1987, between BOk and Kaiser, incorporated by
reference to Exhibit 10.5 of S-1 Registration
Statement No. 33-90450. Substantially similar
director indemnification agreements were executed
between BOk and the following:
Date of Agreement
-----------------
James E. Barnes June 30, 1987
William H. Bell June 30, 1987
James S. Boese June 30, 1987
Dennis L. Brand June 30, 1987
Chester E. Cadieux June 30, 1987
William B. Cleary June 30, 1987
Glenn A. Cox June 30, 1987
William E. Durrett June 30, 1987
Leonard J. Eaton, Jr. June 30, 1987
William B. Fader December 5, 1990
Gregory J. Flanagan June 30, 1987
Jerry L. Goodman June 30, 1987
David A. Hentschel July 7, 1987
Philip N. Hughes July 8, 1987
Thomas J. Hughes, III June 30, 1987
William G. Kerr June 30, 1987
Philip C. Lauinger, Jr. June 30, 1987
Stanley A. Lybarger December 5, 1990
Patricia McGee Maino June 30, 1987
Robert L. Parker, Sr. June 30, 1987
James A. Robinson June 30, 1987
William P. Sweich June 30, 1987
10.6 Capitalization and Stock Purchase Agreement dated
May 20, 1991, between BOK Financial and Kaiser,
incorporated by reference to Exhibit 10.6 of S-1
Registration Statement No. 33-90450.
10.7 BOK Financial Corporation 1991 Special Stock
Option Plan, incorporated by reference to Exhibit
4.0 of S-8 Registration Statement No. 33-44122.
10.7.1 BOK Financial Corporation 1992 Stock Option Plan,
incorporated by reference to Exhibit 4.0 of
S-8 Registration Statement No. 33-55312.
10.7.2 BOK Financial Corporation 1993 Stock Option Plan,
incorporated by reference to Exhibit 4.0 of
S-8 Registration Statement No. 33-70102.
10.7.3 BOK Financial Corporation 1994 Stock Option Plan,
incorporated by reference to Exhibit 4.0 of
S-8 Registration Statement No. 33-79834.
10
BOK FINANCIAL CORPORATION
10.7.4 BOK Financial Corporation 1994 Stock Option Plan
(Typographical Error Corrected January 16, 1995),
incorporated by reference to Exhibit 10.7.4 of
Form 10-K for the fiscal year ended December 31,
1994.
10.7.5 BOK Financial Corporation Directors' Stock
Compensation Plan, incorporated by reference to
Exhibit 4.0 of S-8 Registration Statement No.
33-79836.
10.7.6 Bank of Oklahoma Thrift Plan (Amended and Restated
Effective as of January 1, 1995), incorporated by
reference to Exhibit 10.7.6 of Form 10-K for the
year ended December 31, 1994.
10.7.7 Trust Agreement for the Bank of Oklahoma Thrift
Plan (December 30, 1994), incorporated by
reference to Exhibit 10.7.7 of Form 10-K for the
year ended December 31, 1994.
10.8 Lease Agreement between One Williams Center Co.
and National Bank of Tulsa (predecessor to BOk)
dated June 18, 1974, incorporated by reference to
Exhibit 10.9 of S-1 Registration Statement No.
33-90450.
10.9 Lease Agreement between Security Capital Real
Estate Fund and BOk dated January 1, 1988,
incorporated by reference to Exhibit 10.10 of S-1
Registration Statement No. 33-90450.
10.10 Asset Purchase Agreement (OREO and other assets)
between BOk and Phi-Lea-Em Corporation dated April
30, 1991, incorporated by reference to Exhibit
10.11 of S-1 Registration Statement No. 33-90450.
10.11 Asset Purchase Agreement (Tanker Assets) between
BOk and Green River Exploration Company dated
April 30, 1991, incorporated by reference to
Exhibit 10.12 of S-1 Registration Statement No.
33-90450.
10.12 Asset Purchase Agreement (Recovery Rights) between
BOk and Kaiser dated April 30, 1991, incorporated
by reference to Exhibit 10.13 of S-1 Registration
Statement No. 33-90450.
10.13 Purchase and Assumption Agreement dated August 7,
1992 among First Gibraltar Bank, FSB, Fourth
Financial Corporation and BOk, as amended,
incorporated by reference to Exhibit 10.14 of Form
10-K for the fiscal year ended December 31, 1992.
10.13.1 Allocation Agreement dated August 7, 1992 between
BOk and Fourth Financial Corporation, incorporated
by reference to Exhibit 10.14.1 of Form 10-K for
the fiscal year ended December 31, 1992.
10.14 Merger Agreement among BOK Financial, BOKF Merger
Corporation Number Two, Brookside Bancshares,
Inc., The Shareholders of Brookside Bancshares,
Inc. and Brookside State Bank dated December 22,
1992, as amended, incorporated by reference to
Exhibit 10.15 of Form 10-K for the fiscal year
ended December 31, 1992.
10.14.1 Agreement to Merge between BOk and Brookside State
Bank dated January 27, 1993, incorporated by
reference to Exhibit 10.15.1 of Form 10-K for the
fiscal year ended December 31, 1992.
10.15 Merger Agreement among BOK Financial, BOKF Merger
Corporation Number Three, Sand Springs Bancshares,
Inc., The Shareholders of Sand Springs Bancshares,
Inc. and Sand Springs State Bank dated December
22, 1992, as amended, incorporated by reference to
Exhibit 10.16 of Form 10-K for the fiscal year
ended December 31, 1992.
10.15.1 Agreement to Merge between BOk and Sand Springs
State Bank dated January 27, 1993, incorporated by
reference to Exhibit 10.16.1 of Form 10-K for the
fiscal year ended December 31, 1992.
11
BOK FINANCIAL CORPORATION
10.16 Partnership Agreement between Kaiser-Francis Oil
Company and BOK Financial dated December 1, 1992,
incorporated by reference to Exhibit 10.16 of Form
10-K for the fiscal year ended December 31, 1993.
10.16.1 Amendment to Partnership Agreement between
Kaiser-Francis Oil Company and BOK Financial dated
May 17, 1993, incorporated by reference to Exhibit
10.16.1 of Form 10-K for the fiscal year ended
December 31, 1993.
10.17 Purchase and Assumption Agreement between BOk and
FDIC, Receiver of Heartland Federal Savings and
Loan Association dated October 9, 1993,
incorporated by reference to Exhibit 10.17 of Form
10-K for the fiscal year ended December 31, 1993.
10.18 Merger Agreement among BOk, Plaza National Bank
and The Shareholders of Plaza National Bank dated
December 20, 1993, incorporated by reference to
Exhibit 10.18 of Form 10-K for the fiscal year
ended December 31, 1993.
10.18.1 Amendment to Merger Agreement among BOk, Plaza
National Bank and The Shareholders of Plaza
National Bank dated January 14, 1994, incorporated
by reference to Exhibit 10.18.1 of Form 10-K for
the fiscal year ended December 31, 1993.
10.19 Stock Purchase Agreement between Texas Commerce
Bank, National Association and BOk dated March 11,
1994, incorporated by reference to Exhibit 10.19
of Form 10-K for the fiscal year ended December
31, 1993.
10.20 Merger Agreement among BOK Financial Corporation,
BOKF Merger Corporation Number Four, Citizens
Holding Company and others dated May 11, 1994,
incorporated by reference to Exhibit 10.20 of Form
10-K for the fiscal year ended December 31, 1994.
10.21 Stock Purchase and Merger Agreement among
Northwest Bank of Enid, BOk and The Shareholders
of Northwest Bank of Enid effective as of May 16,
1994, incorporated by reference to Exhibit 10.21
of Form 10-K for the fiscal year ended December
31, 1994.
11.0 Statement regarding the computation of per share
earnings.
13.0 Annual Report to Shareholders for the fiscal year
ended December 31, 1995. Such report, except for
those portions thereof which are expressly
incorporated by reference in this filing, is
furnished for the information of the Commission
and is not deemed to be "filed" as part of this
Annual Report on Form 10-K.
21.0 Subsidiaries of BOK Financial.
23.0 Consent of independent auditors - Ernst & Young
LLP.
99.0 Additional Exhibits.
99.1 Undertakings incorporated by reference into S-8
Registration Statement No. 33-44121 for Bank of
Oklahoma Master Thrift Plan and Trust,
incorporated by reference to Exhibit 99.1 of Form
10-K for the fiscal year ended December 31, 1993.
99.2 Undertakings incorporated by reference into S-8
Registration Statement No. 33-44122 for BOK
Financial Corporation 1991 Special Stock Option
Plan, incorporated by reference to Exhibit 99.2 of
Form 10-K for the fiscal year ended December 31,
1993.
99.3 Undertakings incorporated by reference into S-8
Registration Statement No. 33-55312 for BOK
Financial Corporation 1992 Stock Option Plan,
incorporated by reference to Exhibit 99.3 of Form
10-K for the fiscal year ended December 31, 1993.
99.4 Undertakings incorporated by reference into S-8
Registration Statement No. 33-70102 for BOK
Financial Corporation 1993 Stock Option Plan,
incorporated by reference to Exhibit 99.4 of Form
10-K for the fiscal year ended December 31, 1993.
12
BOK FINANCIAL CORPORATION
99.5 Undertakings incorporated by reference into S-8
Registration Statement No. 33-79834 for BOK
Financial Corporation 1994 Stock Option Plan,
incorporated by reference to Exhibit 99.5 of Form
10-K for the fiscal year ended December 31, 1994.
99.6 Undertakings incorporated by reference into S-8
Registration Statement No. 33-79836 for BOK
Financial Corporation Directors' Stock
Compensation Plan, incorporated by reference to
Exhibit 99.6 of Form 10-K for the fiscal year
ended December 31, 1994.
(B) REPORTS ON FORM 8-K
None.
(C) EXHIBITS REQUIRED BY ITEM 601 OF REGULATION S-K
The exhibits listed in response to Item 14(A)(3) are filed as part of this
report.
(D) FINANCIAL STATEMENT SCHEDULES
None.
13
BOK FINANCIAL CORPORATION
SIGNATURES
----------
Pursuant to the requirements of Section 13 and 15(d) of the Securities Exchange
Act of 1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
BOK FINANCIAL CORPORATION
DATE: March 26, 1996 BY:/s/ George B. Kaiser
-------------- ----------------------------------
George B. Kaiser,
Chairman of the Board of Directors
Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below on March 26, 1996, by the following persons on behalf of
--------------
the Registrant and in the capacities indicated.
OFFICERS
- --------
/s/ George B. Kaiser /s/ Stanley A. Lybarger
- ----------------------------------- ----------------------------------
George B. Kaiser, Stanley A. Lybarger,
Chairman of the Board of Directors Director, President and Chief Executive
Officer
/s/ James A. White
- -----------------------------------
James A. White,
Executive Vice President and
Chief Financial Officer/Treasurer
DIRECTORS
- ---------
/s/ Keith E. Bailey /s/ V. Burns Hargis
- ----------------------------------- ----------------------------------
Keith E. Bailey, Director V. Burns Hargis, Director
/s/ Thomas J. Hughes, III
- ----------------------------------- ----------------------------------
James E. Barnes, Director Thomas J. Hughes, III, Director
/s/ E. Carey Joullian, IV
- ----------------------------------- ----------------------------------
Sharon J. Bell, Director E. Carey Joullian, IV, Director
/s/ Larry W. Brummett /s/ Robert J. LaFortune
- ----------------------------------- ----------------------------------
Larry W. Brummett, Director Robert J. LaFortune, Director
/s/ William B. Cleary
- ----------------------------------- ----------------------------------
William B. Cleary, Director Philip C. Lauinger, Jr., Director
/s/ Glenn A. Cox
- ----------------------------------- ----------------------------------
Glenn A. Cox, Director Robert L. Parker, Sr., Director
/s/ Robert H. Donaldson /s/ James A. Robinson
- ----------------------------------- ----------------------------------
Dr. Robert H. Donaldson, Director James A. Robinson, Director
- ----------------------------------- ----------------------------------
William E. Durrett, Director L. Francis Rooney, III, Director
/s/ James O. Goodwin /s/ Robert L. Zemanek
- ----------------------------------- ----------------------------------
James O. Goodwin, Director Robert L. Zemanek, Director
14