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BANCFIRST CORP /OK/

BANF
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Business Summary

BancFirst Corporation (the "Company") operates as a financial holding company, primarily conducting its activities through its wholly-owned subsidiary, BancFirst, an Oklahoma state-chartered bank. The Company also operates through Pegasus Bank and Worthington Bank, both Texas state-chartered banks, and, until its merger in February 2026, American Bank of Oklahoma (ABOK), an Oklahoma state-chartered bank. The Company's strategy focuses on providing a full range of commercial banking services to retail customers and small to medium-sized businesses in both non-metropolitan trade centers and metropolitan statistical areas of Oklahoma. The Company also has a presence in the Dallas and Fort Worth Metroplex areas of Texas. As of June 30, 2025, the Company's market share of deposits within Oklahoma was 7.58% , an increase from 6.84% as of June 30, 2024. The Company operates as a "super community bank," emphasizing decentralized management for local responsiveness while leveraging a larger lending capacity and broader product line than smaller competitors.

The Company generates revenue primarily from net interest income, which is the difference between interest earned on loans and investments and interest paid on deposits and borrowings. It also generates noninterest income from various financial services. Primary customer segments include retail customers and small to medium-sized businesses engaged in light manufacturing, local wholesale and retail trade, commercial and residential real estate development and construction, services, agriculture, and the energy industry. The Company's lending and investing activities are funded almost entirely by core deposits.

The Company has six principal business units: BancFirst metropolitan banks, BancFirst community banks, Pegasus, Worthington, other financial services, and executive operations and support. BancFirst, Pegasus, Worthington, and ABOK provide commercial, real estate, energy, agricultural, and consumer lending; depository and funds transfer services; collections; safe deposit boxes; cash management services; and trust services. BancFirst Insurance Services, Inc., a wholly-owned subsidiary, offers business and personal insurance, employee benefits, surety bonds, and claims and risk management.

For the fiscal year ended December 31, 2025, the Company reported net income of $240.6 million , or $7.11 per diluted share. Net interest income increased to $490.5 million , up from $446.9 million in 2024. The net interest margin for 2025 was 3.74% , a slight increase from 3.73% in 2024. The provision for credit losses was $5.7 million in 2025, a decrease from $9.0 million in 2024. Noninterest income totaled $200.1 million , compared to $184.6 million in 2024. Noninterest expense was $379.8 million in 2025, up from $347.2 million in 2024. Total assets at year-end 2025 were $14.8 billion , and deposits totaled $12.7 billion . The Company's total stockholders' equity was $1.9 billion at December 31, 2025.

Year-over-year, net interest income increased by $43.6 million in 2025, driven by higher loan volume and growth in other earning assets. Noninterest income increased by $15.6 million , or 8.4% , partially due to a $4.5 million gain on the sale of Visa B-1 stock, a $3.5 million increase in sweep fees, a $1.3 million increase in trust revenue, a $1.4 million increase in treasury income, a $1.5 million increase in insurance commissions, a $1.5 million increase in service charges on deposits, and a $1.0 million increase in gain on sale of other assets. Noninterest expense increased by $32.7 million , or 9.4% , primarily due to a $14.0 million increase in salaries and employee benefits and a $7.4 million increase in net expense from other real estate owned, which included a $4.1 million increase in write-downs of other real estate. Data processing expense also increased by $1.1 million .

During 2025, the Company's assets increased by $1.3 billion from December 31, 2024. Loans grew by $511.5 million , reaching $8.5 billion at December 31, 2025. Deposits increased by $951.8 million to $12.7 billion . Off-balance-sheet sweep accounts decreased by $262.6 million to $4.9 billion . The Company acquired American Bank of Oklahoma on November 17, 2025, adding $243.1 million in loans and $329.5 million in deposits. This acquisition resulted in recording a core deposit intangible of approximately $11.6 million and goodwill of approximately $476,000 . Nonaccrual loans remained relatively stable at 0.72% of total loans, totaling $61.1 million at December 31, 2025, compared to $58.0 million or 0.72% at December 31, 2024. The allowance for credit losses to total loans was 1.22% at December 31, 2025, slightly down from 1.24% at December 31, 2024. Net charge-offs were $8.5 million for the year, compared to $6.3 million for 2024.

Business Outlook

Management expects regular dividend payments to continue in 2026, based on the anticipated performance of the Company, considering earnings, financial condition, capital needs, and applicable governmental policies and regulations.

The Company's acquisition of American Bank of Oklahoma (ABOK) on November 17, 2025, for approximately $33 million in aggregate consideration, is a key growth area. ABOK, a community bank headquartered in Collinsville, Oklahoma, had approximately $414 million in total assets, $244 million in loans, and $341 million in deposits at acquisition. This acquisition expands the Company's banking communities in Oklahoma. ABOK operated as a subsidiary until its merger into BancFirst on February 13, 2026.

The Company is actively investing in affordable housing projects that qualify for Low-Income Housing Tax Credits (LIHTC). Total LIHTC investments were $94.9 million at December 31, 2025, up from $58.6 million at December 31, 2024. Unfunded commitments to these investments as of December 31, 2025, totaled $63.5 million , with additional contributions committed through the year 2040. The Company also invests in New Market Tax Credit (NMTC) investments, which totaled $8.9 million at December 31, 2025, and Historic Tax Credit (HTC) investments, totaling $8.6 million at December 31, 2025, with unfunded commitments of $2.6 million . These investments generate returns primarily through federal tax credits and tax deductions from operating losses.

The Company's model simulations project that a 100 and 200 basis point increase in interest rates would result in a positive variance in net interest income of 4.93% and 10.06% , respectively, relative to the base case over the next twelve months. Conversely, a decrease in interest rates of 100 basis points would result in a negative variance in net interest income of 7.24% relative to the base case over the next twelve months. The Company aims to reduce volatility in its net interest margin and net interest income through periods of changing interest rates by managing interest rate sensitivity and liquidity.

The Company's planned capital allocation includes a Stock Repurchase Program (SRP), under which up to 479,784 shares could be repurchased at December 31, 2025. The SRP is intended to increase earnings per share and return on equity, purchase treasury stock for stock-based compensation plans, and provide liquidity for optionees and stockholders. No shares were repurchased under the SRP for the year ended December 31, 2025, or 2024. The Company also has unfunded commitments to LIHTC investments of $63.5 million and HTC investments of $2.6 million as of December 31, 2025.

Risk Factors

The Company is exposed to various risks inherent in the financial services industry. Interest rate fluctuations could reduce profitability, as the Company's income is primarily derived from the spread between interest earned on assets and interest paid on liabilities. Declining crude oil and natural gas prices could adversely affect the energy loan portfolio and the economies of Oklahoma and Texas, potentially leading to increased losses. A substantial portion of the loan portfolio is secured by real estate, making the Company vulnerable to deterioration in real estate markets, which could result in increased charge-offs and a need for higher provisions for credit losses. Environmental liability risk is associated with lending activities, as the Company may be liable for remediation costs if hazardous substances are found on foreclosed properties. The failure of a significant number of customers to repay loans due to economic conditions or other factors could adversely affect profitability and financial condition. Changes in economic conditions, particularly in Oklahoma, pose significant challenges, as BancFirst operates exclusively within the state. Competition from other financial institutions, including those with greater resources, could reduce margins and market share. Failure to keep pace with rapid technological changes, including the adoption of artificial intelligence, could put the Company at a competitive disadvantage. The highly regulated environment means changes in federal and state laws and regulations, including those related to consumer protection and incentive compensation, could substantially impact operations and financial results. Negative developments in the broader banking industry, such as bank failures and increased competition for deposits, could adversely affect customer confidence and net interest margin. Acquisition-related risks include potential integration difficulties, unforeseen operating challenges, and exposure to unknown liabilities of acquired entities. Liquidity risk is present due to reliance on external funding sources, and unexpected declines in funding or limits on subsidiary dividends could compromise liquidity. Operational risks include the potential ineffectiveness of accounting estimates and risk-management processes, particularly concerning the allowance for credit losses and fair value measurements, which rely on analytical and forecasting models that may be inaccurate. Technological advances in payment processing and consumer protection laws, such as the Durbin Amendment, may negatively impact interchange revenue and non-sufficient funds (NSF) fees. The Company's non-banking businesses also expose it to different risks. Information systems are vulnerable to cybersecurity threats and breaches, which could lead to data loss, service disruptions, regulatory scrutiny, and reputational harm. The trading volume in the Company's common stock is less than that of larger financial services companies, potentially leading to price volatility. The payment of future dividends is not assured and is subject to regulatory considerations. The significant ownership by directors and executive officers allows them to influence stockholder decisions. Provisions in the Company's amended certificate of incorporation and federal banking laws could make it difficult for a third party to acquire the Company. An investment in the Company's common stock is not an insured deposit. Reliance on external vendors for day-to-day operations introduces additional operational and information security risks. Changes in accounting standards could impact financial statements and reported earnings. Failure to maintain effective internal controls could lead to inaccurate financial reporting or fraud. The Company may need to raise additional capital in the future, which may not be available on acceptable terms. The unexpected loss of key management personnel could adversely affect operations.

Management Priorities

Management's message to shareholders emphasizes the Company's strong financial performance in 2025, with net income increasing to $240.6 million and diluted EPS rising to $7.11 . They highlight the growth in net interest income to $490.5 million , driven by higher loan volume and growth in other earning assets, and a slight increase in net interest margin to 3.74% . Management notes the decrease in the provision for credit losses to $5.7 million due to lower loss rates and the impact on vintage loss analysis. Strategic priorities include continued organic loan growth, as evidenced by the $511.5 million increase in loans, and strategic acquisitions, such as American Bank of Oklahoma, which added $243.1 million in loans and $329.5 million in deposits. They also emphasize maintaining strong asset quality, with nonaccrual loans remaining at 0.72% of total loans and the allowance for credit losses to total loans at 1.22% . Management believes that, based upon the anticipated performance of the Company, regular dividend payments will continue in 2026.

View Source Annual Report on SEC.gov ↗

References

  1. [1] Item 1, Business — Market Areas and Competition
  2. [2] Item 1, Business — Market Areas and Competition
  3. [3] Item 7, MD&A — Summary
  4. [4] Item 7, MD&A — Summary
  5. [5] Item 7, MD&A — Summary
  6. [6] Item 7, MD&A — Summary
  7. [7] Item 7, MD&A — Summary
  8. [8] Item 7, MD&A — Summary
  9. [9] Item 7, MD&A — Summary
  10. [10] Item 7, MD&A — Summary
  11. [11] Item 7, MD&A — Summary
  12. [12] Item 7, MD&A — Summary
  13. [13] Item 7, MD&A — Summary
  14. [14] Item 7, MD&A — Summary
  15. [15] Item 7, MD&A — Summary
  16. [16] Item 7, MD&A — Summary
  17. [17] Item 7, MD&A — Summary
  18. [18] Item 7, MD&A — Net Interest Income
  19. [19] Item 7, MD&A — Noninterest Income
  20. [20] Item 7, MD&A — Noninterest Income
  21. [21] Item 7, MD&A — Noninterest Income
  22. [22] Item 7, MD&A — Noninterest Income
  23. [23] Item 7, MD&A — Noninterest Income
  24. [24] Item 7, MD&A — Noninterest Income
  25. [25] Item 7, MD&A — Noninterest Income
  26. [26] Item 7, MD&A — Noninterest Income
  27. [27] Item 7, MD&A — Noninterest Income
  28. [28] Item 7, MD&A — Noninterest Expense
  29. [29] Item 7, MD&A — Noninterest Expense
  30. [30] Item 7, MD&A — Noninterest Expense
  31. [31] Item 7, MD&A — Noninterest Expense
  32. [32] Item 7, MD&A — Noninterest Expense
  33. [33] Item 7, MD&A — Noninterest Expense
  34. [34] Item 7, MD&A — Summary
  35. [35] Item 7, MD&A — Summary
  36. [36] Item 7, MD&A — Summary
  37. [37] Item 7, MD&A — Summary
  38. [38] Item 7, MD&A — Summary
  39. [39] Item 7, MD&A — Summary
  40. [40] Item 7, MD&A — Summary
  41. [41] Item 7, MD&A — Loans
  42. [42] Item 7, MD&A — Deposits
  43. [43] Item 7, MD&A — Intangible Assets, Goodwill and Other Assets
  44. [44] Item 7, MD&A — Intangible Assets, Goodwill and Other Assets
  45. [45] Item 7, MD&A — Summary
  46. [46] Item 7, MD&A — Summary
  47. [47] Item 7, MD&A — Summary
  48. [48] Item 7, MD&A — Summary
  49. [49] Item 7, MD&A — Summary
  50. [50] Item 7, MD&A — Summary
  51. [51] Item 7, MD&A — Summary
  52. [52] Item 7, MD&A — Summary
  53. [53] Item 8, Note 2 — Recent Developments, Including Mergers and Acquisitions
  54. [54] Item 8, Note 2 — Recent Developments, Including Mergers and Acquisitions
  55. [55] Item 8, Note 2 — Recent Developments, Including Mergers and Acquisitions
  56. [56] Item 8, Note 2 — Recent Developments, Including Mergers and Acquisitions
  57. [57] Item 8, Note 6 — Premises and Equipment, Net and Other Assets
  58. [58] Item 8, Note 6 — Premises and Equipment, Net and Other Assets
  59. [59] Item 8, Note 6 — Premises and Equipment, Net and Other Assets
  60. [60] Item 8, Note 6 — Premises and Equipment, Net and Other Assets
  61. [61] Item 8, Note 6 — Premises and Equipment, Net and Other Assets
  62. [62] Item 8, Note 6 — Premises and Equipment, Net and Other Assets
  63. [63] Item 7A, Quantitative and Qualitative Disclosures about Market Risk
  64. [64] Item 7A, Quantitative and Qualitative Disclosures about Market Risk
  65. [65] Item 7A, Quantitative and Qualitative Disclosures about Market Risk
  66. [66] Item 7A, Quantitative and Qualitative Disclosures about Market Risk
  67. [67] Item 7A, Quantitative and Qualitative Disclosures about Market Risk
  68. [68] Item 7A, Quantitative and Qualitative Disclosures about Market Risk
  69. [69] Item 8, Note 15 — Stockholders’ Equity
  70. [70] Item 7, MD&A — Liquidity Risk and Off-Balance Sheet Arrangements
  71. [71] Item 7, MD&A — Liquidity Risk and Off-Balance Sheet Arrangements

Analysis on 5/22/2026