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Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): September 23, 1997
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Southwest Bancorp, Inc.
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(Exact name of registrant as specified in its charter)
Oklahoma 0-23064 73-1136584
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(State or other jurisdiction (Commission file (IRS Employer
of incorporation number) Identification Number
608 South MaiN Street, Stillwater, Oklahoma 74074
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (405) 372-2300
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Item 5. Other Events.
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For information regarding this item, see the Press Release filed as Exhibit 99.1
hereto.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
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(a) Financial Statements. Not applicable.
(b) Pro Forma Financial Information. Not applicable.
(c) Exhibit 99.1 - Press Release dated September 23, 1997.
Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Southwest Bancorp, Inc.
By: /s/ Kerby Crowell
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Kerby Crowell, Executive Vice President
& CFO
Dated: September 23, 1997
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EXHIBIT 99.1
CONTACT: ROBERT L. MCCORMICK, JR., PRESIDENT & C.E.O.
KERBY CROWELL, EXECUTIVE VICE PRESIDENT & C.F.O.
TELEPHONE: (405) 372-2230
RELEASE DATE: SEPTEMBER 23, 1997
SOUTHWEST BANCORP, INC.
ANNOUNCES SIGNIFICANT LOAN LOSS AND PROVISION FOR LOAN LOSSES
Notice: Forward-looking information. This press release contains forward-looking
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financial information, including statements of expected future earnings,
provisions for loan losses, problem loan ratios, gains on an anticipated sale of
assets, and other forward-looking information. This information is based upon
matters which, by their nature, are subject to uncertainties. Because of these
uncertainties, the actual future results may differ materially from those
indicated.
Southwest Bancorp, Inc. (NASDAQ: OKSB, OKSBP OKSBO), the Oklahoma-based parent
company of the Stillwater National Bank and Trust Company (the "Bank"),
announced today that it would record a loan loss provision in the third quarter
that is significantly larger than historical provisions. The provision for loan
losses for the quarter is expected to be $5.1 million, compared with a provision
of $801,000 for the second quarter of 1997 and $775,000 for the third quarter of
1996. The provision for loan losses for the first nine months of 1997 is
expected to total $8.9 million compared with a provision of $2.4 million for the
same period of 1996. The year-to-date 1997 provision also reflects an unusually
large provision recorded in the first quarter of the year.
As a result of this provision, management expects that the Company will record a
net loss for the quarter of approximately $500,000 and that net loss
attributable to common shares will approximate $900,000 or $0.24 per share. For
the first nine months of 1997, management expects that the Company will record
net income of $1.9 million, and net income available for common shares of
$700,000, or $0.18 per share. For 1996, third quarter net income was $1.6
million, third quarter net income available to common shares was $1.2 million,
or $0.32 per share, net income for the first nine months was $5.5 million, and
net income available to common shares for the first nine months was $4.3 million
or $1.15 per share. Actual results for periods ending on September 30, 1997 may
vary from these estimates which are based upon a number of assumptions. The
estimates of loss and income for the third quarter, and the first nine months of
1997 do not include the anticipated gain on sale of the Bank's credit card
portfolio discussed below.
The Company has previously announced that negotiations were underway for the
sale of the Bank's $18.5 million credit card portfolio. The estimated pretax
gain on the sale of the credit card portfolio is expected to approximate $3.6
million. At this date, negotiations continue, and the Company believes that
signing of the agreement for sale of the portfolio is imminent. The agreement,
however, has not been signed. Management believes that a sale of the credit card
portfolio is likely to be recorded in 1997, but is unable to provide assurance
that it will be recorded in the third quarter. It is also possible, but believed
by the Company to be less likely, that no sale, or a sale with less net gain,
will occur.
The higher provision to be recorded in the third quarter is the amount deemed
necessary by management to restore the allowance for loan losses to an
appropriate level after charging-off substantially the entire balance of a group
of related loans. These loans are not connected with the loans that resulted in
the larger than normal provision for loan losses in the first quarter of this
year. The related loans charged-off in the third quarter had outstanding
balances immediately prior to charge-off of $4.8 million. These loans had been
identified as problem loans since July 1994, and were the subject of specific
allocations of the allowance for loan losses in view of the recognized problems,
as shown below.
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<TABLE>
<CAPTION>
At the quarter ended
31-Dec-95 31-Mar-96 30-Jun-96 30-Sep-96 31-Dec-96 31-Mar-97 30-Jun-97 30-Sep-97
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(dollars rounded to thousands)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Potential problem loans not
classified as nonperforming $1,255 $1,488 $1,726 $1,571 $1,509 $1,488 $ 139 $ -
Nonperforming loans:
Nonaccrual - 2,434 2,687 3,623 3,421 3,261 4,923 -
Past due 90 days or more - - - - - - - -
Renegotiated loans 2,996 552 543 - - - - -
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Total nonperforming loans 2,996 2,986 3,230 3,623 3,421 3,261 4,923 -
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Total problem loans 4,251 4,474 4,956 5,194 4,930 4,749 5,062 -
Performing loans 807 556 746 5 - - - -
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Total related loans 5,058 5,030 5,702 5,199 4,930 4,749 5,062 -
Specific allocations of the allowance
for loan losses 1,150 1,628 1,674 1,612 1,606 1,968 2,609 -
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Total related loans net of
specific allocations $3,908 $3,402 $4,028 $3,587 $3,324 $2,781 $2,453 $ -
===========================================================================================
</TABLE>
The Bank had been monitoring the performance of the borrowers of these loans,
and had been receiving timely audited and unaudited financial statements and
other reports that indicated that the loans were not deteriorating. However, in
the third quarter, management of the Bank learned that the borrowers had taken
certain actions that raised serious doubts as to the collectibility of these
loans. Management immediately began an investigation of the loans, which is
continuing. In spite of the charge-offs recorded in the quarter, management of
the Bank will vigorously pursue repayment of these loans and related costs to
the Bank from the borrowers, related persons, and others who may be liable to
the Bank, through all available legal avenues. Management of the Bank has not
been able to determine the amount, if any, of repayments that are likely to be
received based upon its investigation to date.
The Company's ratios relating to problem loans are expected to improve
significantly following the expected additional provision for loan losses
related to this charge-off and other charge-offs now anticipated for the
quarter, as shown below:
<TABLE>
<CAPTION>
Actual Actual Actual Actual Estimated
30-Sep-96 31-Dec-96 31-Mar-97 30-Jun-97 30-Sep-97
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(dollars rounded to thousands)
<S> <C> <C> <C> <C> <C>
Nonperforming loans to total loans 0.99% 1.03% 1.04% 1.47% 0.57%
Allowance for loan losses to total loans 1.14% 1.11% 1.25% 1.22% 1.12%
Allowance for loan losses to total
nonperforming loans 115.52% 107.37% 120.15% 82.86% 197.64%
Total loans $614,183 $644,646 $676,499 $711,894 $718,500
</TABLE>
Southwest Bancorp, Inc. is a publicly-owned company headquartered in Oklahoma.
Its subsidiary, the Stillwater National Bank and Trust Company, operates six
offices located in Stillwater, Tulsa, Oklahoma City and Chickasha, Oklahoma.
