Zions Bancorporation Chairman and CEO Harris Simmons commented, “We’re pleased with the continued improvement in our financial performance, reflected in the 21% increase in earnings per share over the same period last year. The net interest margin strengthened to 3.03% from 2.93% a year ago, and operating costs increased a modest 1%. Average noninterest-bearing demand deposits decreased 1.7% relative to the prior quarter of this year, but were flat to last quarter’s ending balance, suggesting continued stabilization of this important source of low-cost funding. Tangible common equity has grown 28% over the past year, and 8% over the past quarter.”
Mr. Simmons continued, “While classified loans increased 66% quarter over quarter, reflecting somewhat weaker fundamental performance in multi-family residential loans, we expect credit losses to remain well controlled as a result of strong equity and sponsorship in these deals. Realized total credit losses remained very low during the quarter at an annualized rate of 0.02% of loans.”
Mr. Simmons concluded, “Finally, we were pleased to announce during the quarter an agreement with FirstBank, headquartered in Lakewood, Colorado, to purchase four of their branches in California’s Coachella Valley with approximately $730 million in deposits and $420 million in loans. Upon receiving regulatory approval, these offices will become part of California Bank & Trust and will strengthen our competitive position in that market.”