/EIN News/ -- STILLWATER, Okla., Oct. 18, 2016 (GLOBE NEWSWIRE) -- Southwest Bancorp, Inc. (NASDAQ:OKSB), (“Southwest”), today reported net income for the third quarter of 2016 of $4.3 million, or $0.23 per diluted share, compared to $4.1 million, or $0.22 per diluted share, for the third quarter of 2015. Net income for the nine months ended September 30, 2016 totaled $11.5 million, or $0.60 per diluted share, compared to $12.8 million, or $0.67 per diluted share, for the nine months ended September 30, 2015.

Southwest announced that its board of directors has approved a quarterly cash dividend of $0.08 per share payable November 15, 2016 to shareholders of record as of November 1, 2016.

Mark Funke, President and CEO, stated, “Loan growth was solid in the third quarter and there was good improvement in noninterest income. Here are several takeaways from this quarter.

• Total loans grew $58.7 million to $1.9 billion from the second quarter of 2016 and $332.0 million, or 21%, compared to the third quarter of 2015. We funded $98.2 million in new loans during the third quarter of 2016, making this our eleventh consecutive quarter of loan growth.
• The quarterly net interest margin was 3.42% at September 30, 2016, compared to 3.48% at June 30, 2016 and 3.34% at September 30, 2015.
• Pre-tax, pre-provision income was $8.3 million in the third quarter, an increase of 3.9% from $8.0 million in the second quarter of 2016 and an increase of 29.1% from $6.5 million in the third quarter of 2015.
• During the third quarter of 2016, we incurred $0.4 million in restructuring charges for branch closures and personnel reductions.
• The efficiency ratio for the third quarter of 2016 was 66.09%, compared to 65.70% for the second quarter of 2016 and 68.25% for the third quarter of 2015.
• During the third quarter of 2016, Southwest repurchased 61,639 shares for a total of $1.0 million. During the first nine months of 2016, Southwest repurchased 1,398,026 shares for a total of $22.1 million, and since August 2014, Southwest has repurchased 2,519,584 shares under the share repurchase programs for a total of $40.8 million.

“Diluted earnings per share of $0.23 was up 4.5% from the same quarter a year ago. During the third quarter, we initiated the closure of three small branches combined with some personnel reductions. These tough decisions will allow us to operate more efficiently going forward. We will continue to focus our company on producing consistent, conservative, and sustainable earnings through the expansion of our revenue base while prudently managing risk and expenses.”

See Table 3 for details on pre-tax, pre-provision income, which is a non-GAAP financial measure.

Financial Overview

Condition:  As of September 30, 2016, total assets were $2.5 billion, an increase of $65.8 million, when compared to June 30, 2016. As of September 30, 2016, total loans were $1.9 billion, an increase of $58.7 million from the prior quarter end. As of September 30, 2016, investment securities were $427.9 million, an increase of $5.6 million from the prior quarter end. Cash and cash equivalents at September 30, 2016 were $70.1 million, an increase of $2.0 million from June 30, 2016. 

At September 30, 2016, the allowance for loan losses was $28.5 million, an increase of $1.6 million when compared to June 30, 2016 and an increase of $1.9 million when compared to September 30, 2015. The allowance for loan losses to portfolio loans was 1.52% as of September 30, 2016, compared to 1.48% as of June 30, 2016, and 1.73% as of September 30, 2015. The allowance for loan losses to nonperforming loans was 116.02% as of September 30, 2016, compared to 120.39% as of June 30, 2016 and 176.38% as of September 30, 2015. The total allowance for loan losses combined with the purchase discount on acquired loans represents 1.78% of gross loans as of September 30, 2016, compared to 1.87% as of June 30, 2016.

Nonperforming loans were $24.5 million at September 30, 2016, an increase of $2.2 million from June 30, 2016, and an increase of $9.4 million from September 30, 2015. Other real estate was $2.1 million at both September 30, 2016 and June 30, 2016, and $2.3 million at September 30, 2015. Nonperforming assets were $26.6 million, or 1.42% of portfolio loans and other real estate, as of September 30, 2016, compared to $24.4 million, or 1.35% of portfolio loans and other real estate, as of June 30, 2016, and $17.4 million, or 1.12% of portfolio loans and other real estate, as of September 30, 2015.

As of September 30, 2016, total deposits were $1.9 billion, an increase of $45.1 million, when compared to June 30, 2016. Total core funding, which includes all non-brokered deposits and sweep repurchase agreements, comprised 81% of total funding as of September 30, 2016 and June 30, 2016. Wholesale funding, including Federal Home Loan Bank borrowings and brokered deposits, accounted for 19% of total funding at September 30, 2016 and June 30, 2016. See Table 7 for details on core funding and non-brokered deposits, which are non-GAAP financial measures.

The capital ratios of Southwest and Bank SNB as of September 30, 2016 exceeded the criteria for regulatory classification as “well-capitalized”. Southwest’s total regulatory capital was $341.2 million, for a total risk-based capital ratio of 15.21%, Common Equity Tier 1 capital was $268.0 million, for a Common Equity Tier 1 ratio of 11.95%, and Tier 1 capital was $313.0 million, for a Tier 1 risk-based capital ratio of 13.95%. Bank SNB had total regulatory capital of $321.7 million, for a total risk-based capital ratio of 14.37% and Common Equity Tier 1 and Tier 1 capital of $293.6 million, for a Common Equity Tier 1 and Tier 1 risk-based capital ratio of 13.12%. Designation as a well-capitalized institution under regulations does not constitute a recommendation or endorsement by bank regulators.

Third Quarter Results:

Summary:  For the third quarter of 2016, net income was $4.3 million, compared to $5.4 million for the second quarter of 2016 and $4.1 million for the third quarter of 2015. Pre-tax, pre-provision income for the third quarter of 2016 was $8.3 million, compared to $8.0 million for the second quarter of 2016 and $6.4 million for the third quarter of 2015.

The $1.1 million decrease in net income compared to the second quarter of 2016 was primarily due to the $1.7 million provision for loan losses recorded in the third quarter, combined with $0.4 million in restructuring charges. The decrease in net income also includes a $0.1 million increase in net interest income, a $0.7 million increase in noninterest income and a $0.6 million decrease in income taxes, offset in part by a $0.9 million increase in noninterest expense.

The $0.2 million increase in net income compared to the third quarter of 2015 was due to a $3.3 million increase in net interest income and a $0.5 million increase in noninterest income, offset in part by a $1.7 million increase in the provision for loan losses, and a $2.1 million increase in noninterest expense. The increases in net interest income, noninterest income, and noninterest expense are due in part to the First Commercial Bancshares, Inc. acquisition that occurred in the fourth quarter of 2015.

Net Interest Income:  Net interest income totaled $19.8 million for the third quarter of 2016, compared to $19.7 million for the second quarter of 2016 and $16.5 million for the third quarter of 2015. Net interest margin was 3.42% for the third quarter of 2016, compared to 3.48% for the second quarter of 2016 and 3.34% for the third quarter of 2015. Interest income for the third quarter of 2016 and the second quarter of 2016 includes $0.5 million and $0.2 million, of accelerated discount accretion, respectively. The net effects of these adjustments on the net interest margins were a 10 basis point and a 3 basis point increase, respectively, for each quarter. Average loans (including loans held for sale) for the third quarter of 2016 increased $33.2 million when compared to June 30, 2016, and $359.5 million when compared to September 30, 2015. Loans acquired in the fourth quarter of 2015 were $202.4 million. The benefit of the accelerated loan discount accretion was partially reduced by a $0.2 million decrease in interest income on investment securities caused by accelerated premium amortization, resulting from increased prepayment speeds.

Provision (Credit) for Loan Losses and Net Charge-offs:  The provision for loan losses is the amount that is required to maintain the allowance for loan losses at an appropriate level based upon the inherent risks in the loan portfolio after the effects of net charge-offs or net recoveries for the period. The provision for loan losses was a provision of $1.7 million for the third quarter of 2016, compared to a provision of $10,000 for the second quarter of 2016, and a provision of $23,000 for the third quarter of 2015. The third quarter 2016 provision was driven primarily by the growth in the loan portfolio and changes in nonperforming loans. During the third quarter of 2016, net charge-offs totaled $0.1 million, or 0.03% (annualized) of average portfolio loans, compared to net charge-offs of $0.3 million, or 0.07% (annualized) of average portfolio loans for the second quarter of 2016 and net recoveries of $0.4 million, or (0.09%) (annualized) of average portfolio loans for the third quarter of 2015. 

Noninterest Income:  Noninterest income totaled $4.6 million for the third quarter of 2016, compared to $3.9 million for the second quarter of 2016 and $4.0 million for the third quarter of 2015. 

The $0.7 million increase from the second quarter of 2016 is the result of a $0.1 million increase in service charges and fees, a $0.1 million increase in the gain on sales of mortgage loans and a $0.7 million increase in other noninterest income, which is primarily from customer risk management interest rate swap income, partially offset by a $0.2 million decrease in gain on sale of investment securities. Service charges and fees includes a $0.1 million and a $0.2 million impairment on mortgage servicing rights for the third quarter of 2016 and the second quarter of 2016, respectively. Other noninterest income includes a $0.1 million loss on disposition of fixed assets related to branch closures.

The $0.5 million increase from the third quarter of 2015 is the result of a $0.2 million increase in service charges and fees, a $0.2 million increase in the gain on sales of mortgage loans and a $0.1 million increase in other noninterest income, which is primarily from customer risk management interest rate swap income.

Noninterest Expense:  Noninterest expense totaled $16.2 million for the third quarter of 2016, compared to $15.3 million for the second quarter of 2016 and $14.1 million for the third quarter of 2015. 

The $0.9 million increase in noninterest expense from the second quarter of 2016 was due to a $0.2 million increase in personnel expense, a $0.4 million increase in occupancy, a $0.2 million increase in data processing, and a $0.4 million increase in the provision for unfunded loan commitments, offset in part by a $0.2 million decrease in other real estate expenses due to gains on the sales of properties during the quarter. The increase in personnel expense was due to severance and employee benefits, combined with increased mortgage commissions.

The $2.1 million increase in noninterest expense from the third quarter of 2015 consisted of a $1.4 million increase in personnel expense, a $0.8 million increase in occupancy related to branch closures, a $0.1 million increase in data processing and a $0.1 million increase in the provision for unfunded loan commitments, offset in part by a $0.3 million decrease in other real estate expense and a $0.1 million decrease in general and administrative expense.

Income Tax:  Income tax expense totaled $2.2 million for the third quarter of 2016, compared to $2.9 million for the second quarter of 2016 and $2.3 million for the third quarter of 2015.  The income tax expense fluctuates in relation to pre-tax income levels. The third quarter of 2016 effective tax rate was 34.45%, compared to 34.70% for the second quarter of 2016 and 35.84% for the third quarter of 2015. The decline in the effective tax rate includes the impact of an increase in tax exempt income, as a percentage of pre-tax income.

Year-to-Date Results:

Summary:  Net income was $11.5 million for the nine months ended September 30, 2016, compared to $12.8 million for the nine months ended September 30, 2015. The $1.3 million decrease in net income from 2015 is the result of a $9.1 million change in the provision for loan losses and a $6.3 million increase in noninterest expense due to increased personnel, occupancy, and general and administrative expenses, offset in part by an $11.4 million increase in net interest income, a $1.6 million increase in noninterest income, and a $1.1 million decrease in income taxes. The increases in net interest income, noninterest income, and noninterest expense, are due in part to the First Commercial Bancshares, Inc. acquisition that occurred in the fourth quarter of 2015. Net income for the nine months ended September 30, 2016, was also reduced by the restructuring charges of $0.4 million incurred in the third quarter of 2016.

Net Interest Income:  Net interest income totaled $59.3 million for the first nine months of 2016, compared to $47.9 million for the first nine months of 2015, an increase of $11.4 million. Year-to-date net interest margin was 3.48%, compared to 3.30% for 2015. Interest income for the first nine months of 2016 includes $1.0 million of accelerated discount accretion. The net effect on the net interest margin was a 6 basis point increase for the nine-month period. Average loans (including loans held for sale) as of September 30, 2016 increased $363.2 million when compared to September 30, 2015. Loans acquired in the fourth quarter of 2015 were $202.4 million.

Provision (Credit) for Loan Losses and Net Charge-offs:  The provision for loan losses is the amount of expense that is required to maintain the allowance for losses at an appropriate level based upon the inherent risks in the loan portfolio after the effects of net charge-offs or net recoveries for the period. The provision for loan losses was $6.1 million for the first nine months of 2016, compared to a negative provision of $3.0 million for the first nine months of 2015. The provision for loan losses for the first nine months of 2016 was driven by the growth in the loan portfolio and the impact of low energy prices combined with deterioration in a few general business credits. Net charge-offs totaled $3.8 million, or 0.28% (annualized) of average portfolio loans year-to-date as of September 30, 2016, compared to net recoveries of $1.1 million, or (0.11%) (annualized) of average portfolio loans for the same period in 2015.  

Noninterest Income:  Noninterest income totaled $11.8 million for the first nine months of 2016, compared to $10.3 million for the first nine months of 2015. The increase consists of a $0.5 million increase in service charges and fees, which for the first nine months of 2016 includes a $0.6 million impairment of mortgage servicing rights, a $0.4 million increase in gains on sales of mortgage loans, a $0.1 million increase in the gain on sale of investment securities, and a $0.6 million increase in other noninterest income, which includes income on bank owned life insurance and customer risk management interest rate swap income.

Noninterest Expense:  Noninterest expense totaled $47.4 million for the first nine months of 2016, compared to $41.1 million for the first nine months of 2015. The increase consists of a $4.1 million increase in personnel expense, a $1.7 million increase in occupancy, a $0.2 million increase in data processing, a $0.2 million increase in FDIC and other insurance, a $0.2 million increase in the provision for unfunded loan commitments, and a $0.3 million increase in general and administrative expense, offset in part by a $0.4 million decrease in other real estate expense.

Income Tax:  Income tax expense totaled $6.1 million for the first nine months of 2016, compared to $7.2 million for the first nine months of 2015. The income tax expense fluctuates in relation to pre-tax income levels. The year-to-date effective tax rate was 34.69% as of September 30, 2016, compared to 36.02% as of September 30, 2015. The decline in the effective tax rate includes the impact of an increase in tax exempt income, as a percentage of pre-tax income.

Conference Call

Southwest will host a conference call to review these results on Wednesday, October 19, 2016 at 11:00 a.m. Eastern Time (10:00 a.m. Central Time). Investors, news media, and others may pre-register for the call using the following link to receive a special dial-in number and PIN:  http://dpregister.com/10093635. Telephone participants who are unable to pre-register may access the call by telephone at 866-218-2402 (toll-free) or 412-902-4190 (international). Participants are encouraged to dial into the call approximately 10 minutes prior to the start time. The call and corresponding presentation slides will be webcast live on Southwest’s website at www.oksb.com or http://services.choruscall.com/links/oksb161019. An audio replay will be available one hour after the call at 877-344-7529 (toll-free) or 412-317-0088 (international), conference number 10093635. Telephone replay access will be available until November 19, 2016.

Southwest Bancorp and Subsidiaries

Southwest is the holding company for Bank SNB, an Oklahoma state banking corporation (“Bank SNB”). Bank SNB offers commercial and consumer lending, deposit services, specialized cash management, and other financial services from offices in Oklahoma, Texas, Kansas, and Colorado. Bank SNB was chartered in 1894 and Southwest was organized in 1981 as the holding company. At September 30, 2016, Southwest had total assets of approximately $2.5 billion, deposits of $1.9 billion, and shareholders’ equity of $283.8 million.

Southwest’s area of expertise focuses on the special financial needs of healthcare and health professionals, businesses and their managers and owners, commercial lending, energy banking, and commercial real estate borrowers. The strategic focus on healthcare lending was established in 1974. Southwest and its banking subsidiary provide credit and other remittance services, such as deposits, cash management, and document imaging for physicians and other healthcare practitioners to start or develop their practices and finance the development and purchase of medical offices, clinics, surgical care centers, hospitals, and similar facilities. As of September 30, 2016, approximately $443.6 million, or 24%, of loans were loans to individuals and businesses in the healthcare industry. Regular market reviews are conducted of (i) current and potential healthcare lending business, and (ii) the appropriate concentrations within healthcare based upon economic and regulatory conditions.

Southwest’s common stock is traded on the NASDAQ Global Select Market under the symbol OKSB. 

Caution About Forward-Looking Statements

Southwest makes forward-looking statements in this news release that are subject to risks and uncertainties.  These statements are intended to be covered by the safe harbor provision for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995.

These forward-looking statements include: 

• Statements of Southwest's goals, intentions, and expectations;
• Estimates of risks and of future costs and benefits;
• Expectations regarding Southwest’s future financial performance and the financial performance of its operating segments;
• Expectations regarding regulatory actions;
• Expectations regarding Southwest’s ability to utilize tax loss benefits;
• Expectations regarding Southwest’s stock repurchase program;
• Expectations regarding dividends;
• Expectations regarding acquisitions and divestitures;
• Assessments of loan quality, probable loan losses or negative provisions, and the amount and timing of loan payoffs;
• Estimates of the value of assets held for sale or available for sale; 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: the amount and timing of future changes in interest rates, market behavior, and other economic conditions; future laws, regulations, and accounting principles; changes in regulatory standards and examination policies, and a variety of other matters. These other matters include, among other things, the direct and indirect effects of economic conditions on interest rates, credit quality, loan demand, liquidity, and monetary and supervisory policies of banking regulators. 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 future results. For other factors, risks, and uncertainties that could cause actual results to differ materially from estimates and projections contained in forward-looking statements, please read Southwest’s reports filed with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the year ended December 31, 2015. You are urged to carefully review and consider the cautionary statements and other disclosures made in those filings, specifically those under the heading “Risk Factors”.

The cautionary statements in this release also identify important factors and possible events that involve risk and uncertainties that could cause actual results to differ materially from those contained in the forward-looking statements. These forward-looking statements speak only as of the date on which the statements were made. Southwest does not intend, and undertakes no obligation, to update or revise any forward-looking statements contained in this release, whether as a result of differences in actual results, changes in assumptions, or changes in other factors affecting such statements, except as required by law.

Southwest is required under generally accepted accounting principles to evaluate subsequent events and their impact, if any, on its financial statements as of September 30, 2016 through the date its financial statements are filed with the Securities and Exchange Commission. The September 30, 2016 financial statements included in this release will be adjusted if necessary to properly reflect the impact of subsequent events on estimates used to prepare those statements. 

The Southwest Bancorp, Inc. logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=8074

The Bank SNB logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=23106

Financial Tables
Unaudited Financial Highlights		Table 1
Unaudited Consolidated Statements of Financial Condition		Table 2
Unaudited Consolidated Statements of Operations		Table 3
Unaudited Average Balances, Yields, and Rates-Quarterly		Table 4
Unaudited Average Balances, Yields, and Rates-YTD		Table 5
Unaudited Quarterly Summary Loan Data		Table 6
Unaudited Quarterly Summary Financial Data		Table 7
Unaudited Quarterly Supplemental Analytical Data		Table 8

SOUTHWEST BANCORP, INC. UNAUDITED FINANCIAL HIGHLIGHTS (Dollars in thousands, except per share)																					Table 1
		Third Quarter														Second Quarter
QUARTERLY HIGHLIGHTS		2016					2015					% Change				2016					% Change
Operations
Net interest income		$		19,805			$		16,496				20	%		$		19,695				1	%
Provision (credit) for loan losses				1,713					23				7,348					10				17,030
Noninterest income				4,555					4,029				13					3,871				18
Noninterest expense				16,156					14,077				15					15,268				6
Income before taxes				6,491					6,425				1					8,288				(22	)
Taxes on income				2,236					2,303				(3	)				2,876				(22	)
Net income				4,255					4,122				3					5,412				(21	)
Diluted earnings per share				0.23					0.22				5					0.28				(18	)
Balance Sheet
Total assets				2,468,042					2,059,899				20					2,402,262				3
Loans held for sale				7,899					7,024				12					7,090				11
Portfolio loans				1,872,213					1,541,070				21					1,814,287				3
Total deposits				1,947,924					1,626,250				20					1,902,865				2
Total shareholders' equity				283,820					277,344				2					282,360				1
Book value per common share				15.19					14.57				4					15.06				1
Key Ratios
Net interest margin				3.42	%				3.34	%								3.48	%
Efficiency ratio				66.09					68.25									65.70
Total capital to risk-weighted assets				15.21					18.21									15.56
Nonperforming loans to portfolio loans				1.31					0.98									1.23
Shareholders' equity to total assets				11.50					13.46									11.75
Tangible common equity to tangible assets*				10.92					13.40									11.16
Return on average assets (annualized)				0.70					0.81									0.91
Return on average common equity (annualized)				5.97					5.94									7.67
Return on average tangible common equity (annualized)**				6.33					5.97									8.13
		Nine Months
YEAR-TO-DATE  HIGHLIGHTS		2016					2015					% Change
Operations
Net interest income		$		59,340			$		47,897				24	%
Provision (credit) for loan losses				6,098					(3,000	)			303
Noninterest income				11,841					10,278				15
Noninterest expense				47,420					41,141				15
Income before taxes				17,663					20,034				(12	)
Taxes on income				6,127					7,216				(15	)
Net income				11,536					12,818				(10	)
Diluted earnings per share				0.60					0.67				(11	)
Balance Sheet
Total assets				2,468,042					2,059,899				20
Loans held for sale				7,899					7,024				12
Portfolio loans				1,872,213					1,541,070				21
Total deposits				1,947,924					1,626,250				20
Total shareholders' equity				283,820					277,344				2
Book value per common share				15.19					14.57				4
Key Ratios
Net interest margin				3.48	%				3.30	%
Efficiency ratio				66.41					70.33
Total capital to risk-weighted assets				15.21					18.21
Nonperforming loans to portfolio loans				1.31					0.98
Shareholders' equity to total assets				11.50					13.46
Tangible common equity to tangible assets*				10.92					13.40
Return on average assets (annualized)				0.65					0.86
Return on average common equity (annualized)				5.37					6.27
Return on average tangible common equity (annualized)**				5.69					6.31
Balance sheet amounts and ratios are as of period end unless otherwise noted.
* This is a Non-GAAP financial measure.  Please see Table 7 for a reconciliation to the most directly comparable GAAP based measure.
** This is a Non-GAAP financial measure.
Please see accompanying tables for additional financial information.

SOUTHWEST BANCORP, INC. UNAUDITED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (Dollars in thousands)											Table 2
	September 30,					December 31,					September 30,
	2016					2015					2015
Assets
Cash and due from banks	$		36,298			$		24,971			$		25,198
Interest-bearing deposits			33,799					53,158					43,447
Cash and cash equivalents			70,097					78,129					68,645
Securities held to maturity (fair values of $10,887, $12,282, and $13,462 respectively)			10,474					11,797					12,954
Securities available for sale (amortized cost of $414,830, $401,136 and $373,219, respectively)			417,464					400,331					375,589
Loans held for sale			7,899					7,453					7,024
Loans receivable			1,872,213					1,771,975					1,541,070
Less: Allowance for loan losses			(28,452	)				(26,106	)				(26,593	)
Net loans receivable			1,843,761					1,745,869					1,514,477
Accrued interest receivable			5,839					5,767					4,872
Non-hedge derivative asset			4,123					1,793					2,344
Premises and equipment, net			23,248					23,819					18,180
Other real estate			2,106					2,274					2,274
Goodwill			13,545					13,467					1,214
Other intangible assets, net			5,819					6,615					3,973
Other assets			63,667					59,708					48,353
Total assets	$		2,468,042			$		2,357,022			$		2,059,899
Liabilities
Deposits:
Noninterest-bearing demand	$		550,121			$		596,494			$		526,159
Interest-bearing demand			146,583					151,015					114,877
Money market accounts			576,550					534,357					502,028
Savings accounts			54,849					56,333					36,163
Time deposits of $100,000 or more			347,976					311,538					238,318
Other time deposits			271,845					234,368					208,705
Total deposits			1,947,924					1,884,105					1,626,250
Accrued interest payable			969					867					778
Non-hedge derivative liability			4,123					1,793					2,344
Other liabilities			10,842					11,684					9,989
Other borrowings			173,971					110,927					96,801
Subordinated debentures			46,393					51,548					46,393
Total liabilities			2,184,222					2,060,924					1,782,555
Shareholders' equity
Common stock - $1 par value; 40,000,000 shares authorized;
21,223,895, 21,138,028 and 19,901,336 shares issued, respectively			21,224					21,138					19,901
Additional paid-in capital			122,594					121,966					101,611
Retained earnings			180,133					173,210					169,825
Accumulated other comprehensive income (loss)			1,028					(1,290	)				372
Treasury stock, at cost, 2,538,510, 1,131,226 and 868,617 shares, respectively			(41,159	)				(18,926	)				(14,365	)
Total shareholders' equity			283,820					296,098					277,344
Total liabilities and shareholders' equity	$		2,468,042			$		2,357,022			$		2,059,899

SOUTHWEST BANCORP, INC. UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS (Dollars in thousands)																				Table 3
	For the three months ended													For the nine months
	September 30,					June 30,					September 30,			ended September 30,
	2016					2016					2015			2016					2015
Interest income
Loans	$		20,541			$		20,031			$	16,510		$		60,602			$		47,919
Investment securities			1,719					1,962				1,443				5,646					4,120
Other interest-earning assets			50					51				267				154					860
Total interest income			22,310					22,044				18,220				66,402					52,899
Interest expense
Interest-bearing deposits			1,542					1,428				905				4,277					2,602
Other borrowings			374					342				255				1,025					723
Subordinated debentures			589					579				564				1,760					1,677
Total interest expense			2,505					2,349				1,724				7,062					5,002
Net interest income			19,805					19,695				16,496				59,340					47,897
Provision (credit) for loan losses			1,713					10				23				6,098					(3,000	)
Net interest income after provision for loan losses			18,092					19,685				16,473				53,242					50,897
Noninterest income
Service charges and fees			2,681					2,556				2,441				7,786					7,319
Gain on sales of mortgage loans			775					722				565				1,898					1,534
Gain on sale/call of investment securities, net			3					165				19				294					162
Other noninterest income			1,096					428				1,004				1,863					1,263
Total noninterest income			4,555					3,871				4,029				11,841					10,278
Noninterest expense
Salaries and employee benefits			9,794					9,587				8,374				28,723					24,577
Occupancy			3,103					2,669				2,288				8,443					6,773
Data processing			582					430				475				1,482					1,331
FDIC and other insurance			341					432				341				1,141					969
Other real estate, net			(233	)				8				20				(212	)				153
Provision (credit) for unfunded loan commitments			146					(263	)			18				98					(92	)
General and administrative			2,423					2,405				2,561				7,745					7,430
Total noninterest expense			16,156					15,268				14,077				47,420					41,141
Income before taxes			6,491					8,288				6,425				17,663					20,034
Taxes on income			2,236					2,876				2,303				6,127					7,216
Net income	$		4,255			$		5,412			$	4,122		$		11,536			$		12,818
Pre-tax, pre-provision income*	$		8,350			$		8,035			$	6,466		$		23,859			$		16,942
Basic earnings per common share	$		0.23			$		0.29			$	0.22		$	$	0.61			$		0.67
Diluted earnings per common share			0.23					0.28				0.22			$	0.60					0.67
Common dividends declared per share			0.08					0.08				0.06				0.24					0.18
*This is a Non-GAAP based financial measure.  Pre-tax, pre-provision income is calculated as follows:
Net Income + Taxes on income + Provision (credit) for loan losses + Provision (credit) for unfunded loan commitments

SOUTHWEST BANCORP, INC. UNAUDITED AVERAGE BALANCES, YIELDS, AND RATES – QUARTERLY (Dollars in thousands)																										Table 4
	For the three months ended
	September 30, 2016									June 30, 2016										September 30, 2015
	Average					Average				Average						Average				Average						Average
	Balance					Yield/Rate				Balance						Yield/Rate				Balance						Yield/Rate
Assets
Loans	$		1,832,750				4.46	%		$		1,799,591					4.48	%		$		1,473,297					4.45	%
Investment securities			425,276				1.61					428,275					1.84					387,194					1.48
Other interest-earning assets			48,759				0.41					48,569					0.42					100,011					1.06
Total interest-earning assets			2,306,785				3.85					2,276,435					3.89					1,960,502					3.69
Other assets			107,140									103,566										65,459
Total assets	$		2,413,925							$		2,380,001								$		2,025,961
Liabilities and Shareholders' Equity
Interest-bearing demand deposits	$		152,134				0.15	%		$		165,011					0.16	%		$		123,829					0.12	%
Money market accounts			545,040				0.26					537,734					0.25					497,935					0.17
Savings accounts			54,073				0.14					54,808					0.13					35,982					0.10
Time deposits			603,201				0.73					589,029					0.69					446,464					0.57
Total interest-bearing deposits			1,354,448				0.45					1,346,582					0.43					1,104,210					0.33
Other borrowings			163,495				0.91					141,623					0.97					76,799					1.32
Subordinated debentures			46,393				5.08					46,393					4.99					46,393					4.86
Total interest-bearing liabilities			1,564,336				0.64					1,534,598					0.62					1,227,402					0.56
Noninterest-bearing demand deposits			549,077									547,963										511,442
Other liabilities			16,937									13,598										11,708
Shareholders' equity			283,575									283,842										275,409
Total liabilities and shareholders' equity	$		2,413,925							$		2,380,001								$		2,025,961
Net interest income and spread							3.21	%									3.27	%									3.13	%
Net interest margin (1)							3.42	%									3.48	%									3.34	%
Average interest-earning assets
to average interest-bearing liabilities			147.46	%								148.34	%									159.73	%
(1) Net interest margin = annualized net interest income / average interest-earning assets

SOUTHWEST BANCORP, INC. UNAUDITED AVERAGE BALANCES, YIELDS, AND RATES – YEAR-TO-DATE (Dollars in thousands)																Table 5
	For the nine months ended September 30,
	2016									2015
	Average					Average				Average						Average
	Balance					Yield/Rate				Balance						Yield/Rate
Assets
Loans	$		1,807,204				4.48	%		$		1,444,026					4.44	%
Investment securities			421,965				1.79					374,987					1.47
Other interest-earning assets			49,451				0.42					120,749					0.95
Total interest-earning assets			2,278,620				3.89					1,939,762					3.65
Other assets			106,196									57,787
Total assets	$		2,384,816							$		1,997,549
Liabilities and Shareholders' Equity
Interest-bearing demand deposits	$		159,235				0.16	%		$		133,447					0.10	%
Money market accounts			541,870				0.25					485,571					0.16
Savings accounts			54,902				0.14					34,688					0.10
Time deposits			585,545				0.69					443,060					0.57
Total interest-bearing deposits			1,341,552				0.43					1,096,766					0.32
Other borrowings			140,846				0.97					69,908					1.38
Subordinated debentures			47,108				4.98					46,393					4.82
Total interest-bearing liabilities			1,529,506				0.62					1,213,067					0.55
Noninterest-bearing demand deposits			553,338									500,263
Other liabilities			15,108									10,879
Shareholders' equity			286,864									273,340
Total liabilities and shareholders' equity	$		2,384,816							$		1,997,549
Net interest income and spread							3.27	%									3.10	%
Net interest margin (1)							3.48	%									3.30	%
Average interest-earning assets
to average interest-bearing liabilities			148.98	%								159.91	%
(1) Net interest margin = annualized net interest income / average interest-earning assets

SOUTHWEST BANCORP, INC. UNAUDITED QUARTERLY SUMMARY LOAN DATA (Dollars in thousands)																																Table 6
	2016															2015
		Sep. 30				Jun. 30					Mar. 31					Dec. 31					Sep. 30					Jun. 30					Mar. 31
LOAN COMPOSITION
Real estate mortgage:
Commercial	$		893,807			$		862,287			$		878,822			$		938,462			$		869,250			$		759,406			$		759,676
One-to-four family residential			193,678					183,693					158,078					161,958					95,906					85,338					86,343
Real estate construction:
Commercial			184,211					175,805					156,454					129,070					126,407					186,140					192,052
One-to-four family residential			22,460					20,347					24,202					21,337					12,866					13,107					12,586
Commercial			566,403					558,472					543,822					507,173					423,480					384,788					366,282
Installment and consumer			19,553					20,773					20,506					21,429					20,185					20,651					21,306
Total loans, including held for sale			1,880,112					1,821,377					1,781,884					1,779,429					1,548,094					1,449,430					1,438,245
Less allowance for loan losses			(28,452	)				(26,876	)				(27,168	)				(26,106	)				(26,593	)				(26,219	)				(27,250	)
Total loans, net	$		1,851,660			$		1,794,501			$		1,754,716			$		1,753,323			$		1,521,501			$		1,423,211			$		1,410,995
LOANS BY SEGMENT
Oklahoma banking****	$		1,117,716			$		1,085,986			$		1,060,482			$		1,048,473			$		832,282			$		810,367			$		814,949
Texas banking			605,682					577,333					560,421					580,476					563,010					493,047					478,005
Kansas banking			156,714					158,058					160,981					150,480					152,802					146,016					145,291
Total loans	$		1,880,112			$		1,821,377			$		1,781,884			$		1,779,429			$		1,548,094			$		1,449,430			$		1,438,245
NONPERFORMING LOANS BY TYPE
Construction & development	$		1,073			$		1,436			$		1,444			$		1,010			$		391			$		416			$		392
Commercial real estate			7,620					3,894					3,830					3,992					1,795					2,141					2,247
Commercial			12,791					13,800					13,461					13,491					11,727					5,114					5,447
One-to-four family residential			2,982					3,120					3,448					1,777					1,016					1,216					1,065
Consumer			58					75					84					88					148					-					-
Total nonperforming loans	$		24,524			$		22,325			$		22,267			$		20,358			$		15,077			$		8,887			$		9,151
NONPERFORMING LOANS BY SEGMENT
Oklahoma banking****	$		12,275			$		9,268			$		7,978			$		6,948			$		2,846			$		1,670			$		2,244
Texas banking			11,805					12,586					13,521					12,450					11,025					5,353					5,264
Kansas banking			444					471					768					960					1,206					1,864					1,643
Total nonperforming loans	$		24,524			$		22,325			$		22,267			$		20,358			$		15,077			$		8,887			$		9,151
OTHER REAL ESTATE BY TYPE
Construction & development	$		1,756			$		1,962			$		2,060			$		2,060			$		2,025			$		2,035			$		2,035
Commercial real estate			350					160					214					214					249					358					220
Total other real estate	$		2,106			$		2,122			$		2,274			$		2,274			$		2,274			$		2,393			$		2,255
OTHER REAL ESTATE BY SEGMENT
Oklahoma banking****	$		-			$		220			$		274			$		274			$		200			$		200			$		-
Texas banking			2,106					1,902					2,000					2,000					2,025					2,000					2,000
Kansas banking			-					-					-					-					49					193					255
Total other real estate	$		2,106			$		2,122			$		2,274			$		2,274			$		2,274			$		2,393			$		2,255
****Due to immateriality, Colorado banking is included within Oklahoma banking.
Continued

SOUTHWEST BANCORP, INC. UNAUDITED QUARTERLY SUMMARY LOAN DATA (Dollars in thousands)																																Table 6 Continued
	2016															2015
		Sep. 30				Jun. 30					Mar. 31					Dec. 31					Sep. 30					Jun. 30					Mar. 31
POTENTIAL PROBLEM LOANS BY TYPE
Construction & development	$		588			$		-			$		-			$		-			$		-			$		-			$		201
Commercial real estate			12,212					33,472					36,216					26,981					22,362					20,375					24,672
Commercial			30,555					29,537					29,931					9,879					7,366					14,519					14,016
One-to-four family residential			2,119					1,353					2,275					2,285					79					80					81
Consumer			2					2					38					10					-					-					-
Total potential problem loans	$		45,476			$		64,364			$		68,460			$		39,155			$		29,807			$		34,974			$		38,970
POTENTIAL PROBLEM LOANS BY SEGMENT
Oklahoma banking****	$		21,780			$		43,895			$		46,102			$		32,970			$		23,597			$		23,231			$		26,713
Texas banking			21,029					17,726					18,801					4,165					4,086					9,180					9,541
Kansas banking			2,667					2,743					3,557					2,020					2,124					2,563					2,716
Total potential problem loans	$		45,476			$		64,364			$		68,460			$		39,155			$		29,807			$		34,974			$		38,970
ALLOWANCE ACTIVITY
Balance, beginning of period	$		26,876			$		27,168			$		26,106			$		26,593			$		26,219			$		27,250			$		28,452
Charge-offs			626					538					3,725					569					226					325					230
Recoveries			489					236					412					648					577					430					915
Net charge-offs (recoveries)			137					302					3,313					(79	)				(351	)				(105	)				(685	)
Provision (credit) for loan losses			1,713					10					4,375					(566	)				23					(1,136	)				(1,887	)
Balance, end of period	$		28,452			$		26,876			$		27,168			$		26,106			$		26,593			$		26,219			$		27,250
NET CHARGE-OFFS BY TYPE
Construction & development	$		-			$		-			$		-			$		-			$		(16	)		$		(15	)		$		5
Commercial real estate			108					(44	)				(187	)				219					24					82					(118	)
Commercial			(64	)				82					3,408					(286	)				(325	)				(52	)				(188	)
One-to-four family residential			44					(12	)				41					(48	)				(68	)				(91	)				(331	)
Consumer			49					276					51					36					34					(29	)				(53	)
Total net charge-offs (recoveries) by type	$		137			$		302			$		3,313			$		(79	)		$		(351	)		$		(105	)		$		(685	)
NET CHARGE-OFFS BY SEGMENT
Oklahoma banking****	$		34			$		127			$		458			$		288			$		(86	)		$		25			$		(309	)
Texas banking			180					211					952					(415	)				(103	)				(72	)				(114	)
Kansas banking			(77	)				(36	)				1,903					48					(162	)				(58	)				(262	)
Total net charge-offs (recoveries) by segment	$		137			$		302			$		3,313			$		(79	)		$		(351	)		$		(105	)		$		(685	)
****Due to immateriality, Colorado banking is included within Oklahoma banking.

SOUTHWEST BANCORP, INC. UNAUDITED QUARTERLY SUMMARY FINANCIAL DATA (Dollars in thousands, except per share)																				Table 7
	2016									2015
		Sep. 30		Jun. 30			Mar. 31			Dec. 31			Sep. 30			Jun. 30			Mar. 31
PER SHARE DATA
Basic earnings per common share	$	0.23		$	0.29		$	0.10		$	0.23		$	0.22		$	0.22		$	0.24
Diluted earnings per common share		0.23			0.28			0.10			0.23			0.22			0.22			0.24
Common dividends declared per share		0.08			0.08			0.08			0.06			0.06			0.06			0.06
Book value per common share		15.19			15.06			14.81			14.80			14.57			14.38			14.26
Tangible book value per share*		14.33			14.20			13.97			13.98			14.49			14.29			14.17
COMMON STOCK
Shares issued		21,223,895			21,223,613			21,225,034			21,138,028			19,901,336			19,900,855			19,900,350
Less treasury shares		2,538,510			2,472,830			1,939,989			1,131,226			868,617			867,310			867,310
Outstanding shares		18,685,385			18,750,783			19,285,045			20,006,802			19,032,719			19,033,545			19,033,040
OTHER FINANCIAL DATA
Investment securities	$	427,938		$	422,296		$	423,030		$	412,128		$	388,543		$	373,260		$	377,545
Loans held for sale		7,899			7,010			1,803			7,453			7,024			6,687			9,106
Portfolio loans		1,872,213			1,814,367			1,780,081			1,771,975			1,541,070			1,442,743			1,429,139
Total loans		1,880,112			1,821,377			1,781,884			1,779,428			1,548,094			1,449,430			1,438,245
Total assets		2,468,042			2,402,262			2,360,819			2,357,022			2,059,899			2,031,581			2,003,079
Total deposits		1,947,924			1,902,865			1,895,248			1,884,105			1,626,250			1,624,446			1,616,454
Other borrowings		173,971			153,568			117,763			110,927			96,801			75,839			58,578
Subordinated debentures		46,393			46,393			46,393			51,548			46,393			46,393			46,393
Total shareholders' equity		283,820			282,360			285,661			296,098			277,344			273,681			271,444
Mortgage servicing portfolio		453,988			443,568			434,340			432,318			422,845			415,961			407,903
INTANGIBLE ASSET DATA
Goodwill	$	13,545		$	13,467		$	13,467		$	13,467		$	1,214		$	1,214		$	1,214
Core deposit intangible		2,438			2,584			2,734			2,894			342			405			467
Mortgage servicing rights		3,381			3,350			3,411			3,721			3,631			3,518			3,399
Total intangible assets	$	19,364		$	19,401		$	19,612		$	20,082		$	5,187		$	5,137		$	5,080
Intangible amortization expense	$	344		$	350		$	341		$	330		$	243		$	243		$	168
DEPOSIT COMPOSITION
Non-interest bearing demand	$	550,121		$	545,421		$	552,499		$	596,494		$	526,159		$	515,156		$	506,952
Interest-bearing demand		146,583			160,886			168,210			151,015			114,877			131,547			140,659
Money market accounts		576,550			547,415			540,323			534,357			502,028			496,178			488,569
Savings accounts		54,849			55,209			56,235			56,333			36,163			35,647			34,413
Time deposits of $100,000 or more		347,976			323,137			314,496			311,538			238,318			233,105			227,426
Other time deposits		271,845			270,797			263,485			234,368			208,705			212,813			218,435
Total deposits**	$	1,947,924		$	1,902,865		$	1,895,248		$	1,884,105		$	1,626,250		$	1,624,446		$	1,616,454
OFFICES AND EMPLOYEES
FTE Employees		393			410			411			412			358			361			360
Branches		31			33			33			33			24			24			23
Assets per employee	$	6,280		$	5,859		$	5,744		$	5,721		$	5,754		$	5,628		$	5,564
____________________
*This is a Non-GAAP based financial measure.
**Calculation of Non-brokered Deposits and Core Funding (Non-GAAP Financial Measures)
Total deposits	$	1,947,924		$	1,902,865		$	1,895,248		$	1,884,105		$	1,626,250		$	1,624,446		$	1,616,454
Less:
Brokered time deposits		65,398			61,709			55,901			39,797			10,086			7,683			7,694
Other brokered deposits		214,175			175,367			140,372			135,880			133,025			103,025			83,025
Non-brokered deposits	$	1,668,351		$	1,665,789		$	1,698,975		$	1,708,428		$	1,483,139		$	1,513,738		$	1,525,735
Plus:
Sweep repurchase agreements		46,971			42,568			42,763			37,273			50,801			50,839			33,578
Core funding	$	1,715,322		$	1,708,357		$	1,741,738		$	1,745,701		$	1,533,940		$	1,564,577		$	1,559,313
Balance sheet amounts are as of period end unless otherwise noted.

SOUTHWEST BANCORP, INC. UNAUDITED QUARTERLY SUPPLEMENTAL ANALYTICAL DATA (Dollars in thousands)																																Table 8
	2016															2015
		Sep. 30					Jun. 30				Mar. 31					Dec. 31					Sep. 30					Jun. 30					Mar. 31
PERFORMANCE RATIOS
Return on average assets (annualized)			0.70	%				0.91	%				0.32	%				0.78	%				0.81	%				0.85	%				0.92	%
Return on average common equity (annualized)			5.97					7.67					2.56					6.14					5.94					6.11					6.78
Return on average tangible common equity
(annualized)*			6.33					8.13					2.71					6.46					5.97					6.14					6.82
Net interest margin (annualized)			3.42					3.48					3.54					3.48					3.34					3.31					3.25
Total dividends declared to net income			35.14					28.35					84.66					26.22					27.53					27.45					25.19
Effective tax rate			34.45					34.70					35.19					35.96					35.84					34.51					37.49
Efficiency ratio			66.09					65.70					67.48					72.17					68.16					71.83					71.69
NONPERFORMING ASSETS
Nonaccrual loans	$		24,109			$		22,259			$		22,161			$		19,858			$		15,076			$		8,887			$		9,151
90 days past due and accruing			415					66					106					500					1					-					-
Total nonperforming loans			24,524					22,325					22,267					20,358					15,077					8,887					9,151
Other real estate			2,106					2,122					2,274					2,274					2,274					2,393					2,255
Total nonperforming assets	$		26,630			$		24,447			$		24,541			$		22,632			$		17,351			$		11,280			$		11,406
Potential problem loans	$		45,476			$		64,364			$		68,460			$		39,155			$		29,807			$		34,974			$		38,970
ASSET QUALITY RATIOS
Nonperforming assets to portfolio loans and
other real estate			1.42	%				1.35	%				1.38	%				1.28	%				1.12	%				0.78	%				0.80	%
Nonperforming loans to portfolio loans			1.31					1.23					1.25					1.15					0.98					0.62					0.64
Allowance for loan losses to portfolio loans			1.52					1.48					1.53					1.47					1.73					1.82					1.91
Allowance for loan losses to
nonperforming loans			116.02					120.39					122.01					128.23					176.38					295.03					297.78
Net loan charge-offs to average portfolio
loans (annualized)			0.03					0.07					0.75					(0.02	)				(0.09	)				(0.03	)				(0.20	)
CAPITAL RATIOS
Average total shareholders' equity to
average assets			11.75	%				11.93	%				12.42	%				12.77	%				13.59	%				13.87	%				13.59	%
Leverage ratio			13.07					13.18					13.45					14.41					15.84					16.12					15.75
Common equity tier 1 capital			11.95					12.22					12.13					13.21					14.57					15.30					15.51
Tier 1 capital to risk-weighted assets			13.95					14.28					14.14					15.53					16.95					17.84					18.10
Total capital to risk-weighted assets			15.21					15.53					15.39					16.79					18.21					19.09					19.36
Tangible common equity to tangible assets***			10.92					11.16					11.49					11.95					13.40					13.40					13.48
REGULATORY CAPITAL DATA
Common equity tier 1 capital	$		268,045			$		266,612			$		270,564			$		282,737			$		275,350			$		272,048			$		269,007
Tier I capital			313,045					311,612					315,326					332,468					320,350					317,048					314,007
Total capital			341,196					338,968					343,287					359,300					344,095					339,412					335,734
Total risk adjusted assets			2,243,895					2,182,051					2,230,326					2,140,344					1,889,892					1,777,618					1,734,401
Average total assets			2,395,991					2,363,834					2,344,259					2,307,421					2,022,972					1,966,577					1,993,446
____________________
*This is a Non-GAAP based financial measure.
***Calculation of Tangible Common Equity to Tangible Assets (Non-GAAP Financial Measure)
Total shareholders' equity	$		283,820			$		282,360			$		285,661			$		296,098			$		277,344			$		273,681			$		271,444
Less goodwill and core deposit intangible			15,983					16,051					16,201					16,361					1,556					1,619					1,681
Tangible common equity	$		267,837			$		266,309			$		269,460			$		279,737			$		275,788			$		272,062			$		269,763
Total assets	$		2,468,042			$		2,402,262			$		2,360,819			$		2,357,022			$		2,059,899			$		2,031,581			$		2,003,079
Less goodwill and core deposit intangible			15,983					16,051					16,201					16,361					1,556					1,619					1,681
Tangible assets	$		2,452,059			$		2,386,211			$		2,344,618			$		2,340,661			$		2,058,343			$		2,029,962			$		2,001,398
Total shareholders' equity to total assets			11.50	%				11.75	%				12.10	%				12.56	%				13.46	%				13.47	%				13.55	%
Tangible common equity to tangible assets			10.92	%				11.16	%				11.49	%				11.95	%				13.40	%				13.40	%				13.48	%
Balance sheet amounts and ratios are as of period end unless otherwise noted.

For additional information:
Mark W. Funke
President & CEO
Joe T. Shockley, Jr.
EVP & CFO
(405) 372-2230