' Excludes residential mortgage loans held for sale. 2’ Specific allocation for Year 2000 risks were $2.0 million in 1999, $3.6 million in 1998 and $4.8 million in 1997. Specific allocation for the loan concentration risks are included in the appropriate category: Energy, Agriculture and Hotel/Motel. All significant criticized loans are reviewed quarterly. Specific reserves for impairment are determined through evaluation of estimated future cash flow and collateral value in‘accordance with generally accepted accounting principles and regulatory standards. At December 31, 2001 specific impairment reserves totaled $2.5 million on total impaired loans of $40 million. The general reserve for loan losses is determined primarily through an internally developed migration analysis model. The purpose of this model is to determine the probability that each loan in the portfolio has an inherent loss based on historic trends. Management uses an eight-quarter aggregate accumulation of net loan losses as the basis for this model. Greater emphasis is placed on loan losses in the more recent periods. This model is used to assign a general allowance for loan Josses to all commercial loans and leases, excluding loans that have a specific impairment allowance, residential mortgage loans and consumer loans. A nonspecific allowance for loan losses is maintained for risks beyond those factors specific to a particular loan or those identified by the migration analysis. These factors include trends in the general economic conditions in BOK Financial’s primary lending areas, duration of the business cycle, specific conditions in industries where BOK Financial has a concentration of loans and overall growth in the loan portfolio. Additional factors considered are bank regulatory examination results, error potential in the migration analysis model or the underlying data, and other relevant factors. A range of potential losses is determined for each factor identified. At December 31, 2001 the range of potential losses for the more significant factors were: General economic conditions — $3.2 million to $4.0 million Concentration of large loans ~ $1.0 million to $1.9 million Loan portfolio growth — $700 thousand to $1.4 million. Allocation of the loan loss reserve to the major loan categories is presented in Table 16. The increase in the nonspecific allowance was due primarily to the effect of general economic conditions and overall growth in the loan portfolio. A provision for loan losses is charged against earnings in amounts necessary to maintain an adequate loan loss reserve. These provisions totaled $37.6 million for 2001, $17.2 million for 2000 and $10.4 million for 1999. The increase reflected the growth in net loans charged-off for each of those years, growth in nonperforming and potential problem loans. Evaluation of the loan loss reserve requires a significant level of assumptions by management including estimation of future cash flows, collateral values, relevance of historic loss trends to the loan portfolio and assessment of the effect of current economic conditions on borrowers’ ability to repay. The required loan loss reserve could be materially affected by changes in these assumptions. The loan loss reserve is adequate to absorb losses inherent in the loan portfolio based upon current conditions and information available to management. However, actual losses may differ significantly due to changing conditions or information that is currently not available. million during 2001. This amount included $11.4 million for one borrower whose acquisition strategy was adversely affected by market conditions. Total nonaccrual loans decreased by $12.4 million of cash payments received, $9.7 million of losses charged against the reserve for loan losses and $3.8 million of transfers to real estate and other repossessed assets. Information regarding nonperforming assets, which totaled $51 million at December 31, 2001 and $44 million at December 31, 2000 is presented in Table 17. Nonperforming assets included nonaccrual and renegotiated loans and excluded loans 90 days or more past due but still accruing interest. Nonaccrual loans increased by $3.9 million during 2001. Newly identified nonaccruing loans totaled $31.3 Table 16 Loan Loss Reserve Allocation _ December 31, 2001 2000 1999 1998 1997 of % of % of % of % of Reserve? Loans’ Reserve’ _ Loans’ _ Reserve’ ___Loans'__Reserve’__ Loans! Reserve? ~ Loans’ Loan category: Commercial $ 61,164 59.95% $55,187 59.39% $47,261 58.10% $37,570 56.09% $35,009 55.81% Commercial real estate 15,923 21.89 12,393 23.23 11,216 23.86 7,949 21.44 3,236 17.71 Residential mortgage 3,774 11.47 2,019 11.67 2,137 11.58 1,807 14.12 1,783 15.70 Consumer 6,890 6.69 6,407 5.71 6,721 6.46 6,689 8.35 5,763 10:78 Nonspecific allowance 14,154 - 6,649 - 8,899 - 11,907 ~ 8,253 = 100.00% $65,922  100.00% $54,044 100.00% Total $101,905 100.00% $82,655 _100.00% $76,234 Nonperforming Assets 22