EXHIBIT 99
[SOUTHWEST BANCORP, INC. LOGO]
SOUTHWEST BANCORP, INC.
REPORTS RECORD EARNINGS FOR THE FIFTH CONSECUTIVE QUARTER
CONTACT: RICK GREEN, PRESIDENT & C.E.O.
KERBY E. CROWELL, EXECUTIVE VICE PRESIDENT & C.F.O.
TELEPHONE: (405) 372-2230
RELEASE DATE: JULY 21, 2003
July 21, 2003, Stillwater, Oklahoma . . . . Southwest Bancorp, Inc.
(Nasdaq National Market--OKSB, OKSBO), financial holding company for Stillwater
National Bank & Trust Company, today announced record quarterly income of $4.0
million for the second quarter of 2003 - an increase of 19% over the second
quarter 2002. Net income for the first six months of 2003 was $7.5 million - an
increase of 16% over the same period in 2002.
2003 RESULTS AND FOCUS:
o Total assets of $1.5 billion; a 19% increase from June 30, 2002,
and a 13% increase from year-end 2002
o Portfolio loans of $1.2 billion; a 25% increase from June 30,
2002, and a 14% increase from year-end 2002
o Book value per share of $17.60; a 12% increase from June 30, 2002,
and a 5% increase from year-end 2002
YEAR-TO-DATE SECOND QUARTER
------------ --------------
o Net Income: $7.5 million; a 16% increase $4.0 million; a 19% increase
o Diluted earnings per share: $1.24; a 15% increase $0.66; an 18% increase
o Dividends per share: $0.25; a 14% increase $0.125: a 14% increase
o Return on average equity: 15.33% 16.04%
o GAAP-based efficiency ratio: 54.03% 52.79%
STRATEGIC PERSPECTIVE
"Southwest Bancorp, Inc. ("Southwest") maintains an intense focus on
specific performance goals designed to increase shareholder value. These goals
include annual growth in diluted EPS and assets of 10% and geographic market
share growth and expansion," said Rick Green, President and Chief Executive
Officer. "In the second quarter of 2003, Southwest achieved net income of $4.0
million and increased earnings per share by 18% over the second quarter of last
year. This represents the fifth consecutive quarter of record earnings. At
quarter-end, Southwest's total assets were $1.5 billion."
"Southwest's performance is primarily the result of substantial loan
growth, increases in net interest and noninterest income, and improved
efficiency. We are continuing to focus on increasing net interest income by
prudent loan growth coupled with careful management of interest margins and
funding."
"During 2002, Southwest made strategic moves into two important markets
- - Dallas, Texas and Wichita, Kansas. These offices are capitalizing on our
strengths in serving medical, professional and small business customers. We were
pleased with our continuing significant loan growth in Dallas and Wichita. Our
experience there demonstrates our ability to select new markets and to
successfully implement our business plan in them. Southwest's traditional
markets, particularly the Oklahoma City and Tulsa divisions and our Student
Lending division, also have contributed significantly to the overall loan growth
during 2003."
"This year, we established a new group in Stillwater National Bank
responsible for the sale of commercial and commercial real estate loan
participations. The participations group originated and sold approximately $30
million in participations during the second quarter. Although these
participations do not appear on our balance sheet, we earn origination fees and
a "spread," consisting of a portion of the interest paid by the borrower on
them. These sales also help us to better manage our funding resources and
costs."
"We had strong deposit growth in the quarter. The growth in
noninterest-bearing demand deposits and money market accounts contributed to our
financial performance and validates our deposit growth strategies and market
acceptance."
"We continue to market and find acceptance for our `Business Mail
Processing' and `Document Imaging' services, especially in our metropolitan
markets. These products are contributing to our success in gaining
noninterest-bearing demand deposits and should continue to help differentiate
Southwest from other financial services companies."
"Southwest was recently notified by the Office of Thrift Supervision
that our application to create a federal savings bank in Wichita, Kansas has
been deemed complete. Application approval is expected by the end of the third
quarter of 2003. We anticipate opening SNB Bank of Wichita on the site of our
loan production office during the fourth quarter of 2003."
"During the second quarter of 2003, we established SNB Insurance
Agency, Inc. (a subsidiary of Stillwater National Bank), an organization which
provides the conduit for marketing annuity products to our customer base. The
commissions received for the sale of these products will continue to increase
noninterest income."
"On June 26, 2003, Southwest Bancorp issued $20.0 million in trust
preferred securities through a newly formed subsidiary trust, OKSB Statutory
Trust I, in a private placement of pooled trust preferred securities. The trust
preferred
securities are included on the Statement of Financial Condition as "Long-term
Debt" and bear a floating rate of interest, which will be adjusted quarterly and
tied to three-month-Libor. The majority of the proceeds of the private placement
were contributed to Southwest's subsidiary bank, Stillwater National Bank and
Trust Company; $6.0 million of the remaining proceeds will be contributed to SNB
Bank of Wichita upon its organization."
ADDITIONAL FINANCIAL INFORMATION
Net income for the second quarter of 2003 was $4.0 million (a $630,000,
or 19%, increase from the second quarter of 2002), and marked Southwest's fifth
consecutive quarter of record earnings. Diluted earnings per share for the
second quarter of 2003 increased to $0.66, up 18% from the second quarter of
2002.
Net interest income was up 20% from the second quarter of last year.
Non-interest income for the quarter represented 20% of total revenues.
The provision for loan losses of $2.0 million increased $725,000, or
57%, over the 2002 second quarter. Noninterest expense of $9.3 million increased
$1.1 million, or 14%, primarily as a result of increases in compensation,
general and administrative, and occupancy expenses. The efficiency ratio of
52.79% represented an improvement of 336 basis points from the second quarter of
2002. Southwest's efficiency ratio is based directly on financial statement
amounts.
Net income for the first six months of 2003 was $7.5 million, up $1.1
million, or 16%, from the first six months of 2002. Diluted earnings per share
for the first six months of 2003 was $1.24, up 15% from the first six months of
2002.
Net interest income increased 17% from the first six months of 2002.
Non-interest income for the first six months of 2003 represented 21% of total
revenues.
The provision for loan losses of $3.7 million increased $1.2 million,
or 47%, over the first six months of 2002. Noninterest expense of $18.2 million
increased $2.2 million, or 14%, primarily as a result of increases in
compensation, general and administrative, and occupancy expenses.
FINANCIAL CONDITION
At June 30, 2003, total assets were $1.5 billion, a $170.1 million
increase from the end of 2002 and a $246.8 million increase from June 30, 2002.
Total portfolio loans (loans other than those held for sale) at June 30, 2003
were $1.2 billion, up $156.4 million, or 14%, from year-end 2002 and up $247.7
million, or 25%, from June 30, 2002, primarily as a result of growth in
commercial and construction lending, as well as government-guaranteed student
loans.
The allowance for loan losses of $13.9 million increased $2.0 million,
or 17%, from year-end 2002. Total nonperforming loans of $12.3 million decreased
$561,000, or 4%, from year-end 2002, and represented 0.98% of loans,
compared to 1.17% of loans at year-end 2002. At June 30, 2003, $1.1 million, or
9%, of loans classified as nonperforming were guaranteed by United States
agencies or U.S. government sponsored entities. Management believes the amount
of the allowance is appropriate, given our systematic methodology for
calculating the allowance. That methodology is designed to estimate inherent
losses on total loans in the portfolio, including inherent losses on
nonperforming loans.
At June 30, 2003, regulatory capital ratios for Southwest and its
banking subsidiary, Stillwater National Bank and Trust Company, exceeded all
regulatory requirements for a well-capitalized institution.
SECURITIES
Southwest's common stock is traded on the Nasdaq National Market under
the symbol OKSB. Trust preferred securities of Southwest's subsidiary, SBI
Capital Trust, trade on the Nasdaq National market under the symbol OKSBO.
Market makers for Southwest's common stock include Stifel Nicolaus & Co.,
Goldman Sachs & Co., Keefe Bruyette & Woods Inc., Merrill Lynch, RBC Dain
Rauscher, Inc., Schwab Capital Markets, Morgan Stanley & Company, Sandler
O'Neill & Partners and FTN Financial Securities Corp.
OKLAHOMA'S OWN SOUTHWEST BANCORP, INC.
Southwest Bancorp, Inc. and the Stillwater National Bank and Trust
Company are independent, Oklahoma institutions, and are not controlled by out of
state organizations or individuals. Southwest has established and pursued a
strategy of independent operation for the benefit of all of its shareholders,
and has capitalized on its position as an Oklahoma owned and operated banking
organization to increase its banking business.
Southwest is the financial holding company for Stillwater National Bank
and Trust Company, Business Consulting Group, Inc., and Healthcare Strategic
Support, Inc. A substantial portion of Southwest's current business and focus
for the future are services for local businesses, their primary employees, and
other managers and professionals. Southwest seeks to be the premier financial
company for its selected markets. Information regarding Southwest can be
retrieved via the Internet, at www.oksb.com. Southwest and Stillwater National
offer commercial and consumer lending, deposit, and investment services, and
specialized cash management, consulting and other financial services from
offices in Stillwater, Tulsa, Oklahoma City, and Chickasha, Oklahoma, and
Frisco, Texas; loan production offices in Wichita, Kansas and on the campuses of
the University of Oklahoma Health Sciences Center and Oklahoma State
University-Tulsa; a marketing presence in the Student Union at Oklahoma State
University-Stillwater; and on the Internet. Information regarding products and
services of Stillwater National, including SNB DirectBanker(R), its online
banking product, can be retrieved via the Internet, at www.banksnb.com.
Stillwater National's web site and online banking technology are frequently
updated in response to the changing needs of Stillwater National's large base of
Internet banking customers.
FORWARD-LOOKING STATEMENTS
This Press Release includes forward-looking statements, such as:
statements of Southwest's goals, intentions, and expectations; estimates of
risks and of future costs and benefits; assessments of problem loan payoffs and
potential loan losses; and statements of Southwest's ability to achieve
financial and other goals. These forward-looking statements are subject to
significant uncertainties because they are based upon: future interest rates and
other economic conditions; future laws and regulations; and a variety of other
matters. Because of these uncertainties, the actual future results may be
materially different from the results indicated by these forward-looking
statements. In addition, Southwest's past growth and performance do not
necessarily indicate its future results.
SOUTHWEST BANCORP, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Dollars in thousands, except per share data)
JUNE 30, DECEMBER 31,
2003 2002
----------- -----------
ASSETS:
Cash and cash equivalents $ 39,964 $ 34,847
Investment securities:
Held to maturity, fair value $22,730 (2003) and $32,000 (2002) 22,181 31,154
Available for sale, amortized cost $158,893 (2003) and $145,141 (2002) 161,644 148,476
Federal Reserve Bank and Federal Home Loan Bank Stock, at cost 10,861 9,059
Loans held for sale 12,462 10,638
Loans receivable, net of allowance for loan losses
of $13,877 (2003) and $11,888 (2002) 1,232,976 1,078,586
Accrued interest receivable 10,330 9,283
Premises and equipment, net 20,553 20,202
Other assets 9,388 7,523
----------- -----------
Total assets $ 1,520,359 $ 1,349,768
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY:
Deposits:
Noninterest-bearing demand $ 152,629 $ 135,945
Interest-bearing demand 62,954 50,162
Money market accounts 323,373 258,712
Savings accounts 6,389 5,700
Time deposits of $100,000 or more 385,378 309,205
Other time deposits 248,049 262,033
----------- -----------
Total deposits 1,178,772 1,021,757
Accrued interest payable 2,675 4,486
Other liabilities 4,202 2,858
Short-term borrowings 185,557 199,282
Long-term debt 45,013 25,013
----------- -----------
Total liabilities 1,416,219 1,253,396
Shareholders' equity:
Common stock - $1 par value; 20,000,000 shares authorized;
6,121,521 shares issued and outstanding 6,122 6,122
Capital surplus 12,557 12,317
Retained earnings 86,798 80,724
Accumulated other comprehensive income (loss) 1,648 2,201
Treasury stock, at cost; 204,288 (2003) and 348,142 (2002) shares (2,985) (4,992)
----------- -----------
Total shareholders' equity 104,140 96,372
----------- -----------
Total liabilities & shareholders' equity $ 1,520,359 $ 1,349,768
=========== ===========
SOUTHWEST BANCORP, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in thousands)
For the three months For the six months
ended June 30, ended June 30,
2003 2002 2003 2002
-------- -------- -------- --------
Interest income:
Interest and fees on loans $ 19,299 $ 16,443 $ 37,021 $ 32,423
Investment securities 2,012 2,924 4,085 5,900
Other interest-bearing assets 2 4 6 11
-------- -------- -------- --------
Total interest income 21,313 19,371 41,112 38,334
Interest expense:
Interest-bearing deposits 5,442 5,860 10,769 11,904
Short-term borrowings 1,253 1,228 2,548 2,503
Long-term debt 595 581 1,177 1,163
-------- -------- -------- --------
Total interest expense 7,290 7,669 14,494 15,570
-------- -------- -------- --------
Net interest income 14,023 11,702 26,618 22,764
Provision for loan losses 2,000 1,275 3,722 2,525
Other income:
Service charges and fees 2,225 2,003 4,476 3,777
Other noninterest income 268 247 542 475
Gain on sales of loans receivable 1,062 555 1,999 1,199
Gain on sales of investment securities 25 1 27 3
-------- -------- -------- --------
Total other income 3,580 2,806 7,044 5,454
Other expenses:
Salaries and employee benefits 4,921 4,296 9,233 8,098
Occupancy 1,938 1,733 3,860 3,450
FDIC and other insurance 78 66 156 138
Other real estate 9 (43) 170 (21)
General and administrative 2,347 2,094 4,768 4,292
-------- -------- -------- --------
Total other expenses 9,293 8,146 18,187 15,957
-------- -------- -------- --------
Income before taxes 6,310 5,087 11,753 9,736
Taxes on income 2,277 1,684 4,207 3,255
-------- -------- -------- --------
Net income $ 4,033 $ 3,403 $ 7,546 $ 6,481
======== ======== ======== ========
SOUTHWEST BANCORP, INC.
AVERAGE BALANCES, YIELDS AND RATES
(Dollars in thousands)
For the six months ended
June 30, 2003
------------------------------------------------------
Interest
Average Income/ Average
Balance Expense Yield/Rate
------------------------------------------------------
ASSETS:
Loans receivable $1,230,262 $ 37,021 6.07%
Investment securities 184,944 4,085 4.45
Other interest-earning assets 1,200 6 1.01
---------- ---------- ----
Total interest-earning assets 1,416,406 41,112 5.85
Noninterest-earning assets 50,132
----------
Total assets $1,466,538
==========
LIABILITIES AND SHAREHOLDERS' EQUITY:
Interest-bearing demand $ 56,455 $ 196 0.70%
Money market accounts 290,435 2,547 1.77
Savings accounts 6,246 7 0.23
Time deposits 631,089 8,019 2.56
---------- ---------- ----
Total interest-bearing deposits 984,225 10,769 2.21
Short-term borrowings 213,519 2,548 2.41
Long-term debt 25,565 1,177 9.21
---------- ---------- ----
Total interest-bearing liabilities 1,223,309 14,494 2.39
---------- ----
Noninterest-bearing demand 128,069
Other noninterest-bearing liabilities 15,927
Shareholders' equity 99,233
----------
Total liabilities and shareholders' equity $1,466,538
==========
Net interest income $ 26,618
==========
Interest rate spread 3.46%
====
Net interest margin (1) 3.79%
====
Ratio of average interest-earning assets
to average interest-bearing liabilities 115.78%
==========
Net interest income and margin
(tax-equivalent basis) (2) $ 26,929 3.83%
========== ====
(1) The net interest margin is equal to annualized net interest income
divided by average interest-earning assets. In order to make pretax
income and resultant yields on tax-exempt investments and loans
comparable to those on taxable investments.
(2) In order to make pretax income and resultant yields on tax-exempt
investments and loans comparable to those on taxable investments and
loans, a tax-equivalent and loans, a tax equivalent adjustment is made
equally to interest income and income tax expense with no effect on after
tax income. The tax equivalent adjustment has been computed using a
federal income tax rate of 35%.
SOUTHWEST BANCORP, INC.
UNAUDITED CONSOLIDATED FINANCIAL HIGHLIGHTS
(Dollars in thousands, except per share data)
For the three months For the six months
ended June 30, ended June 30,
2003 2002 2003 2002
- -----------------------------------------------------------------------------------------------------------------------------------
PER COMMON SHARE DATA:
- -----------------------------------------------------------------------------------------------------------------------------------
Basic Earnings $ 0.68 $ 0.59 $ 1.28 $ 1.13
Diluted Earnings 0.66 0.56 1.24 1.08
Dividends declared 0.13 0.11 0.25 0.22
Book value (at period end) 17.60 15.75 17.60 15.75
- -----------------------------------------------------------------------------------------------------------------------------------
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
- -----------------------------------------------------------------------------------------------------------------------------------
Basic 5,896,034 5,732,589 5,861,956 5,717,591
Diluted 6,099,550 6,029,952 6,080,837 5,985,521
- -----------------------------------------------------------------------------------------------------------------------------------
KEY RATIOS:
- -----------------------------------------------------------------------------------------------------------------------------------
Return on average assets 1.07% 1.09% 1.04% 1.05%
Return on average total shareholders' equity 16.04% 15.62% 15.33% 15.08%
Efficiency ratio 52.79% 56.15% 54.03% 56.55%
- -----------------------------------------------------------------------------------------------------------------------------------
CAPITAL RATIOS AS OF PERIOD END:
- -----------------------------------------------------------------------------------------------------------------------------------
Leverage ratio 9.04% 9.00%
Tier I capital ratio 10.74% 10.78%
Total capital ratio 12.69% 11.94%
Tier I capital $ 136,462 $ 112,891
Total capital 161,200 125,042
Total risk adjusted assets 1,270,050 1,046,900
- -----------------------------------------------------------------------------------------------------------------------------------
LOAN COMPOSITION AS OF PERIOD END:
- -----------------------------------------------------------------------------------------------------------------------------------
Real estate mortgage:
Commercial $ 383,570 $ 362,235
One-to-four family residential 95,185 101,242
Real estate construction 200,809 109,376
Commercial 392,084 318,008
Installment and consumer:
Government-guaranteed student loans 162,812 90,922
Other 24,855 25,962
---------- ----------
Total loans, including loans held for sale $1,259,315 $1,007,745
Less: Allowance for loan losses (13,877) (12,151)
---------- ----------
Total loans, net $1,245,438 $ 995,594
========== ==========
SOUTHWEST BANCORP, INC.
UNAUDITED CONSOLIDATED FINANCIAL HIGHLIGHTS (CONTINUED)
(Dollars in thousands, except per share data)
For the six months
ended June 30,
2003 2002
- -----------------------------------------------------------------------------------------------------------------
ASSET QUALITY AS OF PERIOD END:
- -----------------------------------------------------------------------------------------------------------------
Nonaccrual loans (1) $ 10,337 $ 7,206
90 day past due and accruing (2) 2,009 1,320
-------- --------
Total nonperforming loans (3) $ 12,346 $ 8,526
======== ========
Other real estate owned $ 551 $ 205
Allowance for loan losses as a percentage of total loans 1.10% 1.21%
Allowance for loan losses as a percentage of nonperforming loans 112.40% 142.52%
Nonperforming loans as a percentage of total loans 0.98% 0.85%
Nonperforming assets as a percentage of total loans and other real estate 1.02% 0.87%
Total charge-offs $ 1,979 $ 2,042
Total recoveries 246 176
-------- --------
Net charge-offs $ 1,733 $ 1,866
======== ========
Net charge-offs (annualized) as a percentage of average loans 0.28% 0.39%
- -----------------------------------------------------------------------------------------------------------------
OTHER MISCELLANEOUS INFORMATION AS OF PERIOD END:
- -----------------------------------------------------------------------------------------------------------------
Goodwill $ 194 $ 194
Mortgage Servicing Rights 1,008 664
Non-mortgage Servicing Rights 110 94
-------- --------
Total Intangible Assets $ 1,312 $ 952
======== ========
1-4 family mortgage loans serviced for others $119,061 $ 96,916
Intangible amortization expense 236 90
FTE employees (at period end) 326 313
Number of ATMs 338 299
Number of branches 8 6
(1) The government-guaranteed portion of loans included in these totals were
$1.1 million (2003) and $1.5 million (2002).
(2) The government-guaranteed portion of loans included in these totals were $0
(2003) and $13,000 (2002).
(3) The government-guaranteed portion of loans included in these totals were
$1.1 million (2003) and $1.5 million (2002).