Zions Bancorporation Reports 2012 Third Quarter Results
Seventh Consecutive Quarter of Profitability with Earnings of $0.34 Per Share
- Zions Bancorporation, the holding company for Zions Bank, reported third quarter net earnings applicable to common shareholders of $62.3 million or $0.34 per diluted common share, compared to $55.2 million or $0.30 per diluted share for the second quarter.
- Adjusted for the noncash effects of (1) the discount amortization on conversion of subordinated debt and additional accretion (net of expense) on acquired FDIC-supported loans, and (2) the remaining discount amortization for the $700 million redemption of TARP preferred stock, net earnings were $85.2 million or $0.46 per diluted share for the third quarter, compared to $72.9 million or $0.40 per diluted share for the second quarter.
- Loans and leases, excluding FDIC-supported loans, increased $351 million, or an annualized 3.2%, to $36.6 billion at Sept. 30, 2012.
- The increases were widespread geographically and were predominantly in commercial and industrial, 1-4 family residential, and term commercial real estate loans.
- Average total deposits increased $535 million, or an annualized 5.0%, to $43.5 billion in the third quarter.
- Zions Bancorporation’s capital ratios remain well in excess of “well-capitalized” levels.
- The tangible common equity ratio equaled 7.17% at Sept. 30, 2012, compared to 6.91% at June 30, 2012.
- On Sept. 26, 2012, Zions Bancorporation redeemed its final $700 million of TARP shares. The shares were redeemed at the full face value (no discount).
- Zions took careful steps to avoid shareholder dilution during the crisis, and as a result Zions was slower to exit TARP compared to most of its peers; however, the extra attention to preventing shareholder dilution paid off with 40% less common share dilution compared to that of other large banks.
- Credit quality continued to improve in the third quarter. All major indicators improved, including net charge-offs, nonperforming assets, delinquent loans, and classified loans (loans with a well-defined weakness).
- Net charge-offs decreased 11% to $38 million compared to $43 million in the second quarter of 2012. Gross charge-offs declined 20% compared to the second quarter and have declined 54% compared to a year ago.
- Nonperforming lending-related assets declined 11% to $838 million at Sept. 30, 2012.
- Nonaccrual loans declined 9% to $719 million at Sept. 30, 2012.
- Classified loans, excluding FDIC-supported loans, decreased approximately 4% to $1.8 billion.
- Approximately 76% of classified loans were current as to principal and interest for the third quarter, compared to 73% for the second quarter of 2012.
- The ratio of nonperforming lending-related assets to net loans and leases and other real estate owned (OREO) decreased to 2.23% at Sept. 30, 2012, compared to 2.53% at June 30, 2012.
- The provision (credit) for loan losses was $(1.9) million for the third quarter, compared to $10.9 million for the second quarter of 2012.
- As a percentage of net loans and leases, the allowance was 2.77% at Sept. 30, 2012.
- Zions’ allowance to net charge-offs ratio continues to rank among the strongest of U.S. regional banks.
- As of Sept. 30, 2012, Zions Bancorporation was carrying $1.0 billion in allowances for loan losses on its balance sheet.
About Zions Bank
Zions Bank, a subsidiary of Zions Bancorporation (NASDAQ: ZION), is Utah’s oldest financial institution and operates 127 full-service financial centers throughout Utah and Idaho. In addition to offering a wide range of traditional banking services, Zions Bank is also a leader in small business lending and has consistently ranked as the No. 1 lender of U.S. Small Business Administration 7(a) loans in Utah for the past 20 years and Idaho’s Boise District for the past 12 years. Founded in 1873, Zions Bank has been serving the communities of the Intermountain West for more than 140 years. Additional information is available at www.zionsbank.com.