Exhibit 99
[LOGO OMITTED]
SOUTHWEST BANCORP, INC. REPORTS EARNINGS
CONTACT: RICK GREEN, PRESIDENT & C.E.O.
KERBY E. CROWELL, EXECUTIVE VICE PRESIDENT & C.F.O.
TELEPHONE: (405) 372-2230
RELEASE DATE: FEBRUARY 2, 2004
February 2, 2004, Stillwater, Oklahoma . . . . Southwest Bancorp, Inc.
(Nasdaq National Market--OKSB, OKSBO), the Oklahoma-based parent company of the
Stillwater National Bank and Trust Company ("Stillwater National") and SNB Bank
of Wichita ("SNB Wichita"), today reported net income for the year 2003, of
$14.9 million, an 11% increase from 2002. Diluted earnings per share were $1.22
compared to $1.11 per share for the 2002 period, up 10%. Net income for the
fourth quarter of 2003 was $3.9 million, or $0.32 per diluted share, compared to
$3.5 million, or $0.29 per diluted share, for the fourth quarter of 2002.
2003 RESULTS AND FOCUS
o Total assets of $1.6 billion; a 17% increase from year-end 2002.
o Portfolio loans of $1.3 billion; a 19% increase from year-end 2002.
o Book value per share of $9.20; a 10% increase from year-end 2002.
YEAR-TO-DATE FOURTH QUARTER
------------------------------ ----------------------------
o Net Income: $14.9 million; an 11% increase $3.9 million; a 12% increase
o Diluted earnings per share: $1.22; a 10% increase $0.32; a 10% increase
o Dividends per share: $0.25; a 14% increase $0.06; the same as for 2002
o Return on average equity: 14.59% 14.69%
o GAAP-based efficiency ratio: 54.95% 56.57%
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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 earnings per share and assets of 10% and
geographic market share growth and expansion," said Rick Green, President and
Chief Executive Officer. "Southwest's earnings growth 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."
"In 2003, Southwest achieved net income of $14.9 million and increased
diluted earnings per share by 10% over the same period last year. We acted
aggressively to resolve problem credits during the fourth quarter, reducing
nonperforming loans by 17% from $19.2 million at the end of the third quarter to
$15.9 million at year-end."
"During 2002, Southwest made strategic moves into two important markets
- - a branch in Dallas, Texas and a loan production office in Wichita, Kansas,
both of which operated as divisions of Stillwater National Bank and Trust
Company. In November 2003, the Wichita loan production office was replaced by a
new Southwest subsidiary, SNB Bank of Wichita. The Dallas and Wichita offices
are capitalizing on our strengths in serving medical, professional and small
business customers. We are pleased with our continuing significant loan growth
in both markets. Our experience there demonstrates our ability to select new
markets and to successfully implement our business plan in them."
"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."
"In the second quarter of 2003, Southwest 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
majority of the proceeds of the private placement were contributed to Stillwater
National; $6.0 million of the remaining proceeds were contributed to SNB Bank of
Wichita upon organization. On October 14, 2003, Southwest issued an additional
$25.0 million of 30-year variable rate trust preferred securities in a private
placement through another subsidiary trust, SBI Capital Trust II. Proceeds from
the October issuance are expected to be used to retire the $25.0 million in
9.30% fixed rate trust preferred securities issued in 1997, which became subject
to redemption by Southwest in the third quarter of 2002. Although the redemption
would result in a charge to expense of approximately $650,000, net of tax
benefit, upon retirement, management estimates that the redemption would have a
net positive effect on net income within twelve months from redemption and
thereafter. Whether or not Southwest redeems the 1997 trust preferred securities
during
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2004 depends upon a number of factors, including the currently unsettled
regulatory capital rules relating to trust preferred securities as a result of
recent changes in accounting standards. Due to these recent changes in
accounting standards, the Trust Preferred Securities are not carried on
Southwest's consolidated financial statements. Instead, Southwest's financial
statements reflect the Subordinated Debentures issued by Southwest to the
subsidiary trusts which provided the funding for the Trust Preferred
Securities."
"At year-end 2003, Southwest had total assets of $1.6 billion, loans of
$1.3 billion, and deposits of $1.2 billion. At that date, the allowance for loan
losses was $15.8 million, or 1.21% of total loans, compared to $11.9 million, or
1.08% of total loans, at year-end 2002. At the end of 2003, regulatory capital
ratios for Southwest, Stillwater National, and SNB Wichita exceeded regulatory
requirements for a well-capitalized institution."
ADDITIONAL FINANCIAL INFORMATION
Net income for 2003 was $14.9 million, up $1.5 million, or 11%, from
2002. Diluted earnings per share for 2003 were $1.22, up 10% from 2002.
Net interest income increased 21% from 2002. Non-interest income for
2003 represented 21% of total revenues.
The provision for loan losses of $8.5 million increased $3.1 million,
or 57%, over 2002. Noninterest expense of $38.4 million increased $5.1 million,
or 15%, primarily as a result of increases in compensation, general and
administrative, and occupancy expenses.
Net income for the fourth quarter of 2003 was $3.9 million, a $434,000,
or 12%, increase from the fourth quarter of 2002. Diluted earnings per share of
$0.32 for the fourth quarter of 2003 increased 10% from the fourth quarter of
2002.
Net interest income increased 26% from the fourth quarter of last year.
Non-interest income for the quarter represented 20% of total revenues.
The provision for loan losses of $2.1 million increased $726,000, or
54%, over the 2002 fourth quarter. Noninterest expense of $10.4 million
increased $1.4 million, or 15%, primarily as a result of increases in
compensation, general and administrative, and occupancy expenses. The efficiency
ratio of 56.57% represented an improvement of 189 basis points from the fourth
quarter of 2002. Southwest's efficiency ratio is based directly on financial
statement amounts.
FINANCIAL CONDITION
At December 31, 2003, total assets were $1.6 billion, a $230.2 million
increase from the end of 2002. Total portfolio loans (loans other than those
held for sale) at year-end 2003 were $1.3 billion, up $211.5 million, or 19%,
from year-end 2002, primarily as a result of growth in commercial and
construction lending, as well as government-guaranteed student loans.
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ALLOWANCE FOR LOAN LOSSES AND NONPERFORMING LOANS
Nonaccrual loans totaled $14.5 million at December 31, 2003, compared
to $17.0 million at September 30, 2003. This $2.5 million reduction is primarily
the result of several large problem credits classified as nonaccrual at
September 30, 2003, that were resolved during the fourth quarter of 2003; $1.4
million in nonaccrual loans were returned to accrual status and $1.7 in
nonaccrual loans were transferred to Other Real Estate. Total nonperforming
loans of $15.9 million increased $3.0 million, or 23%, from year-end 2002, and
represented 1.22% of loans, compared to 1.17% of loans at year-end 2002 and
1.50% of loans at September 30, 2003. At December 31, 2003, $2.7 million, or
17%, of loans classified as nonperforming were guaranteed by United States
agencies or U.S. government sponsored entities.
Mr. Green said, "Much of our business is commercial lending. As a
result, weakness in one or a few large credits can have a significant impact on
our nonperforming loan totals. Through the years, however, we have demonstrated
the ability to resolve problem commercial loans."
The allowance for loan losses of $15.8 million increased $4.0 million,
or 33%, from year-end 2002, due primarily to the $207.7 million growth in loans
that occurred during the year. Management believes the amount of the allowance
is appropriate, given its 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.
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.
SOUTHWEST BANCORP AND SUBSIDIARIES
Southwest is the financial holding company for Stillwater National Bank
and Trust Company, SNB Bank of Wichita, Business Consulting Group, Inc., and
Healthcare Strategic Support, Inc. Southwest is an independent company, not
controlled by other organizations or individuals. Southwest pursues an
established strategy of independent operation for the benefit of all of its
shareholders.
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 services
company for its selected markets. Information regarding Southwest can be
retrieved via the Internet, at www.oksb.com. Southwest, Stillwater National, and
SNB Wichita offer commercial and consumer lending, deposit, and investment
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services, and specialized cash management, consulting and other financial
services from offices in Stillwater, Tulsa, Oklahoma City, and Chickasha,
Oklahoma, Wichita, Kansas and metropolitan Dallas, Texas; loan production
offices 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 and SNB Wichita, including SNB
DirectBanker(R), Southwest's online banking product, can be retrieved via the
Internet, at www.oksb.com. The Stillwater National and SNB Wichita web sites and
online banking technology are frequently updated in response to the changing
needs of the large base of Internet banking customers.
EXPECTED ONE-TIME 2004 EXPENSE
Southwest expects to record a one-time charge relating to executive
retirement in the first quarter of 2004 of approximately $300,000 after related
tax benefits.
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 the amount and timing of
problem loan payoffs and 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.
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SOUTHWEST BANCORP, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Dollars in thousands, except per share data)
DECEMBER 31, DECEMBER 31,
2003 2002
------------ ------------
ASSETS:
Cash and cash equivalents $ 33,981 $ 34,847
Investment securities:
Held to maturity, fair value $16,144 (2003) and $32,000 (2002) 15,916 31,154
Available for sale, amortized cost $176,470 (2003) and $145,141 (2002) 177,074 148,476
Federal Reserve Bank and Federal Home Loan Bank Stock, at cost 11,276 9,059
Loans held for sale 6,876 10,638
Loans receivable, net of allowance for loan losses
of $15,848 (2003) and $11,888 (2002) 1,286,112 1,078,586
Accrued interest receivable 11,321 9,283
Premises and equipment, net 19,818 20,202
Other assets 18,351 8,309
----------- -----------
Total assets $ 1,580,725 $ 1,350,554
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY:
Deposits:
Noninterest-bearing demand $ 167,332 $ 135,945
Interest-bearing demand 53,955 50,162
Money market accounts 376,016 258,712
Savings accounts 6,903 5,700
Time deposits of $100,000 or more 358,130 309,205
Other time deposits 241,789 262,033
----------- -----------
Total deposits 1,204,125 1,021,757
Accrued interest payable 3,375 4,498
Income tax payable 2,850 --
Other liabilities 4,410 2,858
Other borrowings 183,850 199,282
Subordinated Debentures 72,180 25,787
----------- -----------
Total liabilities 1,470,790 1,254,182
Shareholders' equity:
Common stock - $1 par value; 20,000,000 shares authorized;
12,243,042 shares issued and outstanding 12,243 12,243
Capital surplus 6,997 6,196
Retained earnings 92,657 80,724
Accumulated other comprehensive income 360 2,201
Treasury stock, at cost; 287,410 (2003) and 696,284 (2002) shares (2,322) (4,992)
----------- -----------
Total shareholders' equity 109,935 96,372
----------- -----------
Total liabilities & shareholders' equity $ 1,580,725 $ 1,350,554
=========== ===========
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SOUTHWEST BANCORP, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in thousands)
For the three months For the twelve months
ended December 31, ended December 31,
2003 2002 2003 2002
-------- -------- -------- -------
Interest income:
Interest and fees on loans $19,844 $16,770 $76,115 $65,503
Investment securities 1,944 2,249 7,954 10,948
Other interest-bearing assets 3 4 10 44
-------- -------- ------- -------
Total interest income 21,791 19,023 84,079 76,495
Interest expense:
Interest-bearing deposits 4,893 5,585 20,645 23,451
Other borrowings 1,165 1,193 4,887 4,829
Subordinated Debentures 1,049 599 3,079 2,398
-------- -------- ------- -------
Total interest expense 7,107 7,377 28,611 30,678
-------- -------- ------- -------
Net interest income 14,684 11,646 55,468 45,817
Provision for loan losses 2,074 1,348 8,522 5,443
Other income:
Service charges and fees 2,375 2,335 9,293 8,216
Gain on sales of loans receivable 954 1,044 4,111 3,170
Gain on sales of investment securities 0 97 28 328
Other noninterest income 300 226 1,068 1,004
-------- -------- ------- -------
Total other income 3,629 3,702 14,500 12,718
Other expenses:
Salaries and employee benefits 5,359 4,577 19,792 17,168
Occupancy 2,169 1,890 8,107 7,119
FDIC and other insurance 94 74 340 286
Other real estate 47 21 215 2
General and administrative 2,691 2,411 9,994 8,744
-------- -------- ------- -------
Total other expenses 10,360 8,973 38,448 33,319
-------- -------- ------- -------
Income before taxes 5,879 5,027 22,998 19,773
Taxes on income 1,956 1,538 8,106 6,354
-------- -------- ------- -------
Net income $3,923 $3,489 $14,892 $13,419
========= ======== ======= =======
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SOUTHWEST BANCORP, INC.
AVERAGE BALANCES, YIELDS AND RATES
(Dollars in thousands)
For the three months ended For the twelve months ended
December 31, 2003 December 31, 2002
------------------------------------ ------------------------------------
Interest Interest
Average Income/ Average Average Income/ Average
Balance Expense Yield/Rate Balance Expense Yield/Rate
------------------------------------- ------------------------------------
ASSETS:
Loans receivable $1,318,552 $19,844 5.97% $1,269,216 $76,115 6.00%
Investment securities 199,743 1,944 3.86 191,276 7,954 4.16
Other interest-earning assets 1,302 3 0.91 1,092 10 0.92
---------- -------- ---- ---------- ------- ----
Total interest-earning assets 1,519,597 21,791 5.69 1,461,584 84,079 5.75
Noninterest-earning assets 48,342 50,155
---------- ----------
Total assets $1,567,939 $1,511,739
========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY:
Interest-bearing demand $ 54,487 $ 73 0.53% $ 56,011 $ 355 0.63%
Money market accounts 399,590 1,367 1.36 336,274 5,237 1.56
Savings accounts 7,146 5 0.28 6,608 17 0.26
Time deposits 584,108 3,448 2.34 622,422 15,036 2.42
---------- ------- ---- ---------- ------- ----
Total interest-bearing deposits 1,045,331 4,893 1.93 1,021,315 20,645 2.10
Other borrowings 186,131 1,165 2.48 200,473 4,887 2.44
Subordinated Debentures 68,538 1,049 6.12 42,042 3,079 7.32
---------- ------- ---- ---------- ------- ----
Total interest-bearing liabilities 1,300,000 7,107 2.17 1,263,830 28,611 2.26
-------- ---- ------- ----
Noninterest-bearing demand 152,952 139,061
Other noninterest-bearing liabilities 9,068 6,802
Shareholders' equity 105,919 102,046
---------- ----------
Total liabilities and shareholders' equity $1,567,939 $1,511,739
========== ==========
Net interest income $14,684 $55,468
======== =======
Interest rate spread 3.52% 3.49%
==== ====
Net interest margin (1) 3.83% 3.80%
==== ====
Ratio of average interest-earning assets
to average interest-bearing liabilities 116.89% 115.65%
========= ==========
Net interest income and margin
(tax-equivalent basis) (2) $14,784 3.86% $55,983 3.83%
======== ==== ======= ====
(1) The net interest margin is equal to annualized net interest income
divided by average interest-earning assets.
(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 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%.
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SOUTHWEST BANCORP, INC.
UNAUDITED CONSOLIDATED FINANCIAL HIGHLIGHTS
(Dollars in thousands, except per share data) For the three months For the twelve months
ended December 31, ended December 31,
2003 2002 2003 2002
- -------------------------------------------------------------------------------------------------------------------------------
PER COMMON SHARE DATA:
- -------------------------------------------------------------------------------------------------------------------------------
Basic Earnings $ 0.33 $ 0.30 $ 1.26 $ 1.17
Diluted Earnings 0.32 0.29 1.22 1.11
Dividends declared 0.06 0.06 0.25 0.22
Book value (at period end) 9.20 8.35 9.20 8.35
- -------------------------------------------------------------------------------------------------------------------------------
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
- -------------------------------------------------------------------------------------------------------------------------------
Basic 11,905,084 11,540,294 11,798,810 11,490,166
Diluted 12,329,963 12,094,604 12,159,620 12,052,118
- -------------------------------------------------------------------------------------------------------------------------------
KEY RATIOS:
- -------------------------------------------------------------------------------------------------------------------------------
Return on average assets 0.99% 1.05% 0.99% 1.05%
Return on average total shareholders' equity 14.69% 14.71% 14.59% 14.94%
Efficiency ratio 56.57% 58.46% 54.95% 56.92%
- -------------------------------------------------------------------------------------------------------------------------------
CAPITAL RATIOS AS OF PERIOD END:
- -------------------------------------------------------------------------------------------------------------------------------
Leverage ratio 9.32% 8.99%
Tier I capital ratio 11.13% 10.38%
Total capital ratio 14.90% 11.42%
Tier I capital $ 145,906 $ 118,955
Total capital 195,254 130,843
Total risk adjusted assets 1,310,355 1,145,655
- -------------------------------------------------------------------------------------------------------------------------------
LOAN COMPOSITION AS OF PERIOD END:
- -------------------------------------------------------------------------------------------------------------------------------
Real estate mortgage:
Commercial $ 402,596 $ 374,999
One-to-four family residential 83,250 102,423
Real estate construction 230,292 130,001
Commercial 355,965 348,879
Installment and consumer:
Government-guaranteed student loans 211,546 119,064
Other 25,187 25,746
---------- ----------
Total loans, including loans held $1,308,836 $1,101,112
for sale
Less: Allowance for loan losses (15,848) (11,888)
---------- ----------
Total loans, net $1,292,988 $1,089,224
========== ==========
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SOUTHWEST BANCORP, INC.
UNAUDITED CONSOLIDATED FINANCIAL HIGHLIGHTS (CONTINUED)
(Dollars in thousands, except per share data) For the twelve months
ended December 31,
2003 2002
- ------------------------------------------------------------------------------------------------------------
ASSET QUALITY AS OF PERIOD END:
- ------------------------------------------------------------------------------------------------------------
Nonaccrual loans (1) $ 14,530 $ 11,455
Restructured loans -- --
90 day past due and accruing (2) 1,384 1,452
-------- --------
Total nonperforming loans (3) $ 15,914 $ 12,907
======== ========
Other real estate owned $ 1,699 $ 747
Allowance for loan losses as a percentage of total loans 1.21% 1.08%
Allowance for loan losses as a percentage of nonperforming loans 99.59% 92.11%
Nonperforming loans as a percentage of total loans 1.22% 1.17%
Nonperforming assets as a percentage of total loans and other real estate 1.34% 1.24%
Total charge-offs $ 5,077 $ 5,396
Total recoveries 515 349
-------- --------
Net charge-offs $ 4,562 $ 5,047
======== ========
Net charge-offs as a percentage of average loans 0.36% 0.50%
- ------------------------------------------------------------------------------------------------------------
OTHER MISCELLANEOUS INFORMATION AS OF PERIOD END:
- ------------------------------------------------------------------------------------------------------------
Goodwill $ 194 $ 194
Mortgage Servicing Rights 1,128 865
Non-mortgage Servicing Rights 90 112
-------- --------
Total Intangible Assets $ 1,412 $ 1,171
======== ========
1-4 family mortgage loans serviced for others $124,366 $107,733
Intangible amortization expense 398 202
FTE employees (at period end) 345 324
Number of ATMs 294 347
Number of branches 9 7
(1) The government-guaranteed portion of loans included in these totals were
$2.6 million (2003) and $970,000 (2002).
(2) The government-guaranteed portion of loans included in these totals were
$0 (2003) and $119,000 (2002).
(3) The government-guaranteed portion of loans included in these totals were
$2.6 million (2003) and $1.1 million (2002).
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