| Zions Bancorporation, N.A. One South Main Salt Lake City, UT 84133 January 24, 2022 |  | ||||
| www.zionsbancorporation.com | |||||
Fourth Quarter 2021 Financial Results: FOR IMMEDIATE RELEASE
Investor and Media Contact: James Abbott (801) 844-7637
| Zions Bancorporation, N.A. reports: 4Q21 Net Earnings of $207 million, diluted EPS of $1.34 | ||
| compared with 4Q20 Net Earnings of $275 million, diluted EPS of $1.66, and 3Q21 Net Earnings of $234 million, diluted EPS of $1.45 | ||
| 2021 Annual Net Earnings of $1.1 billion, diluted EPS of $6.79, compared with 2020 Annual Net Earnings of $505 million, diluted EPS of $3.02 | ||
FOURTH QUARTER RESULTS
| $1.34 | $207 million | 2.58% | 10.2% | |||||||||||||||||
Net earnings per diluted common share | Net Earnings | Net interest margin (“NIM”) | Common Equity Tier 1 ratio | |||||||||||||||||
| FOURTH QUARTER HIGHLIGHTS¹ | ||||||||
| Net Interest Income and NIM | • | Net interest income was $553 million, compared with $550 million | ||||||
| • | NIM was 2.58%, compared with 2.95%, and was impacted by significant deposit growth and an accompanying change in the composition of interest-earning assets | |||||||
| Operating Performance | • | Pre-provision net revenue ("PPNR") was $304 million, up 2%, and adjusted PPNR² was $288 million, up 3% | ||||||
| • | Noninterest expense was $449 million, up 6%, and adjusted noninterest expense² was $446 million, up 5%, and included a $10 million charitable contribution during the current quarter | |||||||
| • | The efficiency ratio² was 60.8%, compared with 60.2% | |||||||
| Loans and Credit Quality | • | Loans and leases were $50.9 billion, down $2.6 billion, or 5%; excluding PPP, loans and leases were $49.0 billion, up $1.1 billion, or 2% | ||||||
| • | The provision for credit losses was a positive $25 million, compared with a negative $67 million | |||||||
| • | The allowance for credit losses was 1.13% of loans (ex-PPP), compared with 1.74% of loans (ex-PPP) | |||||||
| • | Nonperforming assets3 were $269 million, or 0.6%, of loans (ex-PPP), compared with $371 million, or 0.8%, of loans (ex-PPP) | |||||||
| Capital | • | The CET1 capital ratio was 10.2%, compared with 10.8% | ||||||
| • | Common stock repurchases during the quarter of $325 million, 5.0 million shares, or 3.2% of shares outstanding as of September 30, 2021 | |||||||
| Notable items | • | Net gain related to SBIC investments of $19 million | ||||||
| • | Gain on sale of bank-owned facilities of $12 million in advance of occupying our new technology campus in mid-2022 | |||||||
| • | Deposits were $82.8 billion, up $13.1 billion, or 19%, resulting in a loan-to-deposit ratio of 61% | |||||||
| • | During the quarter, $1.1 billion of PPP loans were forgiven by the SBA, which contributed $30 million of interest income through accelerated recognition of net unamortized deferred fees | |||||||
| CEO COMMENTARY | ||
Harris H. Simmons, Chairman and CEO of Zions Bancorporation, commented, “We were pleased with our fourth quarter results, which included $1.4 billion of non-PPP loan growth relative to the third quarter – an 11.7% annualized growth rate after a period of attrition in loan volumes in earlier months of the pandemic. Credit quality remained very strong, as demonstrated by a 0.01% annualized net charge-off rate, both for the fourth quarter and the full year. Customer-related noninterest income increased 9.4% over the prior year’s fourth quarter. “Finally, continued strong growth in average deposits, which increased 19.3% over the prior year quarter – with average noninterest-bearing demand deposits comprising 51% of total deposits versus 47% a year ago – allowed us to increase our securities portfolio by 43% from the year-ago period, while leaving considerable upside for margin expansion as interest rates rise.” | ||
OPERATING PERFORMANCE2 | ||
1 Comparisons noted in the bullet points are calculated for the current quarter versus the same prior-year period, unless otherwise specified.
2 For information on non-GAAP financial measures, see pages 17-19.
3 Does not include banking premises held for sale.
ZIONS BANCORPORATION, N.A.
Press Release – Page 2
January 24, 2022
Comparisons noted in the sections below are calculated for the current quarter versus the same prior-year period, unless otherwise specified. Growth rates of 100% or more are considered not meaningful (“NM”) as they generally reflect a low initial starting point.
RESULTS OF OPERATIONS
| Net Interest Income and Margin | |||||||||||||||||||||||||||||||||||||||||
| 4Q21 - 3Q21 | 4Q21 - 4Q20 | ||||||||||||||||||||||||||||||||||||||||
| (In millions) | 4Q21 | 3Q21 | 4Q20 | $ | % | $ | % | ||||||||||||||||||||||||||||||||||
| Interest and fees on loans | $ | 471 | $ | 484 | $ | 499 | $ | (13) | (3) | % | $ | (28) | (6) | % | |||||||||||||||||||||||||||
| Interest on money market investments | 7 | 7 | 3 | — | — | 4 | NM | ||||||||||||||||||||||||||||||||||
| Interest on securities | 88 | 78 | 69 | 10 | 13 | 19 | 28 | ||||||||||||||||||||||||||||||||||
| Total interest income | 566 | 569 | 571 | (3) | (1) | (5) | (1) | ||||||||||||||||||||||||||||||||||
| Interest on deposits | 7 | 7 | 13 | — | — | (6) | (46) | ||||||||||||||||||||||||||||||||||
| Interest on short- and long-term borrowings | 6 | 7 | 8 | (1) | (14) | (2) | (25) | ||||||||||||||||||||||||||||||||||
| Total interest expense | 13 | 14 | 21 | (1) | (7) | (8) | (38) | ||||||||||||||||||||||||||||||||||
| Net interest income | $ | 553 | $ | 555 | $ | 550 | $ | (2) | — | $ | 3 | 1 | |||||||||||||||||||||||||||||
| bps | bps | ||||||||||||||||||||||||||||||||||||||||
Yield on interest-earning assets1 | 2.64 | % | 2.75 | % | 3.06 | % | (11) | (42) | |||||||||||||||||||||||||||||||||
Rate paid on total deposits and interest-bearing liabilities1 | 0.06 | % | 0.07 | % | 0.12 | % | (1) | (6) | |||||||||||||||||||||||||||||||||
Cost of total deposits1 | 0.03 | % | 0.03 | % | 0.08 | % | — | (5) | |||||||||||||||||||||||||||||||||
Net interest margin1 | 2.58 | % | 2.68 | % | 2.95 | % | (10) | (37) | |||||||||||||||||||||||||||||||||
1 Rates are calculated using amounts in thousands and a tax rate of 21% for the periods presented.
Net interest income increased $3 million to $553 million in the fourth quarter of 2021, driven largely by a significant increase in average earning assets. Growth in these assets had a dilutive effect on the net interest margin, given an increased concentration in lower-yielding assets and the low interest rate environment.
Average interest-earning assets increased $11.4 billion, or 15%, driven by growth in money market investments, securities, and commercial loans (ex-PPP). These increases were partially offset by declines in PPP and consumer loans. Average money market investments, including short-term deposits held at the Federal Reserve, increased to 15.4% of average interest-earning assets, compared with 7.2%. Average securities increased to 25.9% of average interest-earning assets, compared with 20.9%, as we have actively deployed excess liquidity into short-to-medium duration securities.
The net interest margin was 2.58%, compared with 2.95%. The yield on average interest-earning assets was 2.64% in the fourth quarter of 2021, a decrease of 42 basis points. The yield on total loans remained relatively stable at 3.73%, compared with 3.71%. Excluding PPP loans, the yield on loans decreased 18 basis points. The yield on securities decreased 20 basis points, primarily due to lower yields on re-investment of principal payments and other purchases throughout the year.
The annualized cost of total deposits for the fourth quarter of 2021 was 0.03%, compared with 0.08%. The rate paid on total deposits and interest-bearing liabilities was 0.06%, a decrease from 0.12% during the fourth quarter of 2020, which was primarily due to low deposit rates and strong noninterest bearing deposit growth. Average noninterest bearing deposits as a percentage of total deposits were 51%, compared with 47% for the same prior year period.
During the fourth quarter of 2021, more than 10,000 PPP loans, totaling $1.1 billion, were forgiven by the SBA. Total interest income from PPP loans was $44 million, of which $30 million was related to accelerated recognition of net unamortized deferred fees on these loans due to forgiveness. At December 31, 2021, the remaining unamortized net origination fees on these loans totaled $45 million.
- more -
ZIONS BANCORPORATION, N.A.
Press Release – Page 3
January 24, 2022
| Noninterest Income | |||||||||||||||||||||||||||||||||||||||||
| 4Q21 - 3Q21 | 4Q21 - 4Q20 | ||||||||||||||||||||||||||||||||||||||||
| (In millions) | 4Q21 | 3Q21 | 4Q20 | $ | % | $ | % | ||||||||||||||||||||||||||||||||||
| Commercial account fees | $ | 34 | $ | 34 | $ | 32 | $ | — | — | % | $ | 2 | 6 | % | |||||||||||||||||||||||||||
| Card fees | 25 | 25 | 22 | — | — | 3 | 14 | ||||||||||||||||||||||||||||||||||
| Retail and business banking fees | 19 | 20 | 18 | (1) | (5) | 1 | 6 | ||||||||||||||||||||||||||||||||||
| Loan-related fees and income | 22 | 27 | 25 | (5) | (19) | (3) | (12) | ||||||||||||||||||||||||||||||||||
| Capital markets and foreign exchange fees | 24 | 17 | 19 | 7 | 41 | 5 | 26 | ||||||||||||||||||||||||||||||||||
| Wealth management fees | 13 | 13 | 10 | — | — | 3 | 30 | ||||||||||||||||||||||||||||||||||
| Other customer-related fees | 15 | 15 | 13 | — | — | 2 | 15 | ||||||||||||||||||||||||||||||||||
| Customer-related fees | 152 | 151 | 139 | 1 | 1 | 13 | 9 | ||||||||||||||||||||||||||||||||||
| Fair value and nonhedge derivative income (loss) | (1) | 2 | 8 | (3) | NM | (9) | NM | ||||||||||||||||||||||||||||||||||
| Dividends and other income | 19 | 9 | 7 | 10 | NM | 12 | NM | ||||||||||||||||||||||||||||||||||
| Securities gains (losses), net | 20 | (23) | 12 | 43 | NM | 8 | 67 | ||||||||||||||||||||||||||||||||||
| Total noninterest income | $ | 190 | $ | 139 | $ | 166 | $ | 51 | 37 | $ | 24 | 14 | |||||||||||||||||||||||||||||
Total customer-related fees increased $13 million, or 9%, to $152 million, driven by increased capital markets and foreign exchange activity, card fees, and wealth management fees, partially offset by a decrease in loan-related fees and income.
Dividends and other income increased $12 million, primarily due to the gain on sale of certain bank-owned facilities during the quarter. These sales resulted from the consolidation of a substantial portion of our technology and operations facilities in advance of occupying our new Corporate Technology Center, which is expected to be completed in mid-2022. The new technology campus will allow us to achieve efficiencies by eliminating smaller facilities and reducing related occupancy costs.
Net securities gains and losses increased $8 million, primarily due to net gains related to our SBIC investment portfolio. During the fourth quarter of 2021, we recognized a $31 million realized gain resulting from the sale of one of our SBIC investments, which was partially offset by a $12 million negative mark-to-market adjustment to our investment in Recursion Pharmaceuticals, Inc., reducing our remaining $35 million unrealized gain from the third quarter of 2021.
We recognized a $1 million loss related to a credit valuation adjustment (“CVA”) on client-related interest rate swaps, compared with an $8 million CVA gain in the prior year period. The CVA may fluctuate from period to period based on the credit quality of our clients and changes in interest rates, which impacts the value of, and our credit exposure to, the client-related interest rate swaps.
| Noninterest Expense | |||||||||||||||||||||||||||||||||||||||||
| 4Q21 - 3Q21 | 4Q21 - 4Q20 | ||||||||||||||||||||||||||||||||||||||||
| (In millions) | 4Q21 | 3Q21 | 4Q20 | $ | % | $ | % | ||||||||||||||||||||||||||||||||||
| Salaries and employee benefits | $ | 282 | $ | 285 | $ | 277 | $ | (3) | (1) | % | $ | 5 | 2 | % | |||||||||||||||||||||||||||
| Occupancy, net | 32 | 33 | 33 | (1) | (3) | (1) | (3) | ||||||||||||||||||||||||||||||||||
| Furniture, equipment and software, net | 33 | 31 | 30 | 2 | 6 | 3 | 10 | ||||||||||||||||||||||||||||||||||
| Other real estate expense, net | — | — | 1 | — | — | (1) | NM | ||||||||||||||||||||||||||||||||||
| Credit-related expense | 7 | 7 | 6 | — | — | 1 | 17 | ||||||||||||||||||||||||||||||||||
| Professional and legal services | 15 | 16 | 19 | (1) | (6) | (4) | (21) | ||||||||||||||||||||||||||||||||||
| Advertising | 6 | 4 | 6 | 2 | 50 | — | — | ||||||||||||||||||||||||||||||||||
| FDIC premiums | 7 | 5 | 6 | 2 | 40 | 1 | 17 | ||||||||||||||||||||||||||||||||||
| Other | 67 | 48 | 46 | 19 | 40 | 21 | 46 | ||||||||||||||||||||||||||||||||||
| Total noninterest expense | $ | 449 | $ | 429 | $ | 424 | $ | 20 | 5 | $ | 25 | 6 | |||||||||||||||||||||||||||||
Adjusted noninterest expense 1 | $ | 446 | $ | 432 | $ | 423 | $ | 14 | 3 | $ | 23 | 5 | |||||||||||||||||||||||||||||
1 For information on non-GAAP financial measures, see pages 17-19.
- more -
ZIONS BANCORPORATION, N.A.
Press Release – Page 4
January 24, 2022
Noninterest expense increased $25 million, or 6%, relative to the prior year quarter, and was largely attributable to a $21 million increase in other noninterest expense. This increase was primarily due to a $10 million donation to our charitable foundation, as well as increases related to a success fee accrual adjustment for our SBIC investments, software licenses and maintenance, and other business development costs.
Salaries and benefits expense increased $5 million, or 2%, and was partially offset by a $4 million, or 21% decrease in professional and legal services, largely due to higher technology spend and third-party assistance related to PPP loan forgiveness in the prior year period.
Adjusted noninterest expense increased $23 million, or 5%, to $446 million, and includes the previously discussed $10 million charitable contribution, compared with $423 million for the prior year period. The efficiency ratio was 60.8%, compared with 60.2%. Excluding the $10 million charitable contribution, the efficiency ratio for the fourth quarter of 2021 would have been 59.4%. For information on non-GAAP financial measures, including differences between noninterest expense and adjusted noninterest expense, see pages 17-19.
BALANCE SHEET ANALYSIS
| Loans and Leases | |||||||||||||||||||||||||||||||||||||||||
| 4Q21 - 3Q21 | 4Q21 - 4Q20 | ||||||||||||||||||||||||||||||||||||||||
| (In millions) | 4Q21 | 3Q21 | 4Q20 | $ | % | $ | % | ||||||||||||||||||||||||||||||||||
| Loans held for sale | $ | 83 | $ | 67 | $ | 81 | $ | 16 | 24 | % | $ | 2 | 2 | % | |||||||||||||||||||||||||||
| Loans and leases: | |||||||||||||||||||||||||||||||||||||||||
Commercial – excluding PPP loans | $ | 26,585 | $ | 25,369 | $ | 24,900 | $ | 1,216 | 5 | $ | 1,685 | 7 | |||||||||||||||||||||||||||||
Commercial – PPP loans | 1,855 | 3,080 | 5,572 | (1,225) | (40) | (3,717) | (67) | ||||||||||||||||||||||||||||||||||
| Commercial real estate | 12,198 | 12,153 | 12,104 | 45 | — | 94 | 1 | ||||||||||||||||||||||||||||||||||
| Consumer | 10,213 | 10,076 | 10,900 | 137 | 1 | (687) | (6) | ||||||||||||||||||||||||||||||||||
| Loans and leases, net of unearned income and fees | 50,851 | 50,678 | 53,476 | 173 | — | (2,625) | (5) | ||||||||||||||||||||||||||||||||||
| Less allowance for loan losses | 513 | 491 | 777 | 22 | 4 | (264) | (34) | ||||||||||||||||||||||||||||||||||
| Loans and leases held for investment, net of allowance | $ | 50,338 | $ | 50,187 | $ | 52,699 | $ | 151 | — | $ | (2,361) | (4) | |||||||||||||||||||||||||||||
| Unfunded lending commitments and letters of credit | $ | 26,661 | $ | 26,138 | $ | 24,949 | $ | 523 | 2 | $ | 1,712 | 7 | |||||||||||||||||||||||||||||
Loans and leases, net of unearned income and fees, decreased $2.6 billion, or 5%, to $50.9 billion at December 31, 2021, primarily due to the forgiveness of PPP loans. Excluding PPP loans, total loans and leases increased $1.1 billion, or 2%, to $49.0 billion. Municipal loans, owner occupied loans, and commercial and industrial loans increased $0.7 billion, $0.5 billion, and $0.4 billion, respectively. Consumer 1-4 family residential mortgage loans decreased $0.9 billion, primarily due to continued refinancing activity, while home equity lines of credit increased $0.3 billion.
Unfunded lending commitments and letters of credit increased $1.7 billion, or 7%, to $26.7 billion at December 31, 2021, primarily due to growth in our home equity credit line and commercial and industrial loan portfolios as well as a decrease in commitment utilization.
- more -
ZIONS BANCORPORATION, N.A.
Press Release – Page 5
January 24, 2022
| Credit Quality | |||||||||||||||||||||||||||||||||||||||||
| 4Q21 - 3Q21 | 4Q21 - 4Q20 | ||||||||||||||||||||||||||||||||||||||||
| (In millions) | 4Q21 | 3Q21 | 4Q20 | $ | % | $ | % | ||||||||||||||||||||||||||||||||||
| Provision for credit losses | $ | 25 | $ | (46) | $ | (67) | $ | 71 | NM | $ | 92 | NM | |||||||||||||||||||||||||||||
| Allowance for credit losses | 553 | 529 | 835 | 24 | 5 | % | (282) | (34) | % | ||||||||||||||||||||||||||||||||
| Net loan and lease charge-offs (recoveries) | 1 | (1) | 15 | 2 | NM | (14) | (93) | ||||||||||||||||||||||||||||||||||
Nonperforming assets2 | 272 | 324 | 371 | (52) | (16) | (99) | (27) | ||||||||||||||||||||||||||||||||||
| Classified loans | 1,236 | 1,397 | 1,641 | (161) | (12) | (405) | (25) | ||||||||||||||||||||||||||||||||||
| 4Q21 | 3Q21 | 4Q20 | bps | bps | |||||||||||||||||||||||||||||||||||||
Ratio of ACL to loans1 and leases outstanding, at period end | 1.09 | % | 1.04 | % | 1.56 | % | 5 | (47) | |||||||||||||||||||||||||||||||||
Ratio of ACL to loans1 and leases outstanding (ex-PPP), at period end | 1.13 | % | 1.11 | % | 1.74 | % | 2 | (61) | |||||||||||||||||||||||||||||||||
| Annualized ratio of net loan and lease charge-offs to average loans | 0.01 | % | (0.01) | % | 0.11 | % | 2 | (10) | |||||||||||||||||||||||||||||||||
| Ratio of classified loans to total loans and leases (ex-PPP) | 2.52 | % | 2.93 | % | 3.43 | % | (41) | (91) | |||||||||||||||||||||||||||||||||
Ratio of nonperforming assets1 and accruing loans 90 days or more past due to loans and leases and other real estate owned | 0.55 | % | 0.64 | % | 0.71 | % | (9) | (16) | |||||||||||||||||||||||||||||||||
1 Does not include loans held for sale.
2 Does not include banking premises held for sale.
Net loan and lease charge-offs were $1 million, compared with $15 million in the prior year quarter, reflecting strong credit performance. During the fourth quarter of 2021, we recorded a positive $25 million provision for credit losses, compared with a negative $67 million provision for the prior year period. The allowance for credit losses (“ACL”) was $553 million at December 31, 2021, compared with $835 million at December 31, 2020. The decrease in the ACL was due largely to improvements in economic forecasts and credit quality, compared with the economic stress caused by the COVID-19 pandemic in the prior year period, and was partially offset by the expected impact of the resurgence of COVID-19 cases resulting from the Omicron variant. The ratio of ACL to total loans and leases (ex-PPP) was 1.13% at December 31, 2021, compared with 1.74% at December 31, 2020.
| Deposits and Borrowed Funds | |||||||||||||||||||||||||||||||||||||||||
| 4Q21 - 3Q21 | 4Q21 - 4Q20 | ||||||||||||||||||||||||||||||||||||||||
| (In millions) | 4Q21 | 3Q21 | 4Q20 | $ | % | $ | % | ||||||||||||||||||||||||||||||||||
| Noninterest-bearing demand | $ | 41,053 | $ | 39,150 | $ | 32,494 | $ | 1,903 | 5 | % | $ | 8,559 | 26 | % | |||||||||||||||||||||||||||
| Interest-bearing: | |||||||||||||||||||||||||||||||||||||||||
| Savings and money market | 40,114 | 37,046 | 34,571 | 3,068 | 8 | 5,543 | 16 | ||||||||||||||||||||||||||||||||||
| Time | 1,622 | 1,688 | 2,588 | (66) | (4) | (966) | (37) | ||||||||||||||||||||||||||||||||||
| Total deposits | $ | 82,789 | $ | 77,884 | $ | 69,653 | $ | 4,905 | 6 | $ | 13,136 | 19 | |||||||||||||||||||||||||||||
| Borrowed funds: | |||||||||||||||||||||||||||||||||||||||||
| Federal funds purchased and other short-term borrowings | $ | 903 | $ | 579 | $ | 1,572 | $ | 324 | 56 | $ | (669) | (43) | |||||||||||||||||||||||||||||
| Long-term debt | 1,012 | 1,020 | 1,336 | (8) | (1) | (324) | (24) | ||||||||||||||||||||||||||||||||||
| Total borrowed funds | $ | 1,915 | $ | 1,599 | $ | 2,908 | $ | 316 | 20 | $ | (993) | (34) | |||||||||||||||||||||||||||||
Total deposits increased $13.1 billion, or 19%, to $82.8 billion, primarily due to a $8.6 billion increase in noninterest-bearing deposits. Average total deposits increased to $81.4 billion, compared with $68.3 billion for the fourth quarter of 2020. Average noninterest-bearing deposits increased 29% to $41.4 billion, from $32.0 billion, and were 51% and 47% of average total deposits for the respective time periods.
- more -
ZIONS BANCORPORATION, N.A.
Press Release – Page 6
January 24, 2022
Total borrowed funds decreased $1.0 billion, or 34%, to $1.9 billion. Average borrowed funds decreased to $1.7 billion, compared with $2.7 billion for the prior year quarter. The decrease in long-term debt was primarily due to the maturity of $281 million of 3-year, 3.50% senior notes during the third quarter of 2021. The decrease in overall borrowed funds continues to reflect less reliance on federal funds purchased and other short-term borrowings due to strong deposit growth.
| Shareholders’ Equity | |||||||||||||||||||||||||||||||||||||||||
| 4Q21 - 3Q21 | 4Q21 - 4Q20 | ||||||||||||||||||||||||||||||||||||||||
| (In millions, except share data) | 4Q21 | 3Q21 | 4Q20 | $ | % | $ | % | ||||||||||||||||||||||||||||||||||
| Shareholders’ equity: | |||||||||||||||||||||||||||||||||||||||||
| Preferred stock | $ | 440 | $ | 440 | $ | 566 | $ | — | — | % | $ | (126) | (22) | % | |||||||||||||||||||||||||||
| Common stock and additional paid-in capital | 1,928 | 2,245 | 2,686 | (317) | (14) | (758) | (28) | ||||||||||||||||||||||||||||||||||
| Retained earnings | 5,175 | 5,025 | 4,309 | 150 | 3 | 866 | 20 | ||||||||||||||||||||||||||||||||||
| Accumulated other comprehensive income (loss) | (80) | 64 | 325 | (144) | NM | (405) | NM | ||||||||||||||||||||||||||||||||||
| Total shareholders’ equity | $ | 7,463 | $ | 7,774 | $ | 7,886 | $ | (311) | (4) | $ | (423) | (5) | |||||||||||||||||||||||||||||
| Capital distributions: | |||||||||||||||||||||||||||||||||||||||||
| Common dividends paid | $ | 58 | $ | 62 | $ | 56 | $ | (4) | (6) | $ | 2 | 4 | |||||||||||||||||||||||||||||
| Bank common stock repurchased | 325 | 325 | — | — | — | 325 | NM | ||||||||||||||||||||||||||||||||||
| Total capital distributed to common shareholders | $ | 383 | $ | 387 | $ | 56 | $ | (4) | (1) | $ | 327 | NM | |||||||||||||||||||||||||||||
| shares | % | shares | % | ||||||||||||||||||||||||||||||||||||||
| Weighted average diluted common shares outstanding (in thousands) | 153,635 | 160,480 | 163,900 | (6,845) | (4) | % | (10,265) | (6) | % | ||||||||||||||||||||||||||||||||
| Common shares outstanding, at period end (in thousands) | 151,625 | 156,530 | 164,090 | (4,905) | (3) | (12,465) | (8) | ||||||||||||||||||||||||||||||||||
The common stock dividend was $0.38 per share, compared with $0.34 during the prior year quarter. Weighted average diluted shares outstanding decreased 10.3 million from the fourth quarter of 2020, primarily due to share repurchases. During the fourth quarter of 2021, we repurchased 5.0 million common shares outstanding for $325 million, which was equivalent to 3.2% of common stock outstanding as of September 30, 2021. During the last four quarters, we repurchased 13.5 million common shares outstanding for $800 million, which was equivalent to 8.2% of common stock outstanding as of the prior year end.
Preferred stock decreased $126 million due to the redemption of the outstanding shares of our 5.75% Series H Non-Cumulative Perpetual Preferred Stock at par value during the second quarter of 2021. Accumulated other comprehensive income decreased $405 million to a loss of $80 million at December 31, 2021, primarily due to decreases in the fair value of available-for-sale securities as a result of changes in interest rates.
Tangible book value per common share increased to $39.62, compared with $38.42. Basel III common equity tier 1 (“CET1”) capital was $6.1 billion, compared with $6.0 billion. The estimated Basel III CET1 capital ratio was 10.2%, compared with 10.8%.
Our Tier 1 leverage ratio declined to 7.2% from 8.3%, and has become more relevant in our capital adequacy assessments. Recent deposit-driven balance sheet growth has resulted in a modest reduction in our risk-weighted regulatory capital ratios, but a larger reduction in the Tier 1 leverage ratio, as the denominator for this ratio is not adjusted for risk.
- more -
ZIONS BANCORPORATION, N.A.
Press Release – Page 7
January 24, 2022
Supplemental Presentation and Conference Call
Zions has posted a supplemental presentation to its website, which will be used to discuss these fourth quarter results at 5:30 p.m. ET on January 24, 2022. Media representatives, analysts, investors, and the public are invited to join this discussion by calling (253) 237-1247 (domestic and international) and entering the passcode 9682126, or via on-demand webcast. A link to the webcast will be available on the Zions Bancorporation website at zionsbancorporation.com. The webcast of the conference call will also be archived and available for 30 days.
About Zions Bancorporation, N.A.
Zions Bancorporation, N.A. is one of the nation's premier financial services companies with annual net revenue of $2.9 billion in 2021 and more than $90 billion of total assets. Zions operates under local management teams and distinct brands in 11 western states: Arizona, California, Colorado, Idaho, Nevada, New Mexico, Oregon, Texas, Utah, Washington, and Wyoming. The Bank is a consistent recipient of national and state-wide customer survey awards in small and middle-market banking, as well as a leader in public finance advisory services and Small Business Administration lending. In addition, Zions is included in the S&P 500 and NASDAQ Financial 100 indices. Investor information and links to local banking brands can be accessed at zionsbancorporation.com.
Forward-Looking Information
This earnings release includes “forward-looking statements” as that term is defined in the Private Securities Litigation Reform Act of 1995. These statements, often accompanied by words such as “may,” “might,” “could,” “anticipate,” “expect,” and similar terms, are based on management’s current expectations and assumptions regarding future events or determinations, all of which are subject to known and unknown risks and uncertainties.
Forward-looking statements are not guarantees, nor should they be relied upon as representing management’s views as of any subsequent date. Factors that could cause our actual results, performance or achievements, industry trends, and results or regulatory outcomes to differ materially from those expressed or implied in the forward-looking statements are discussed in our 2020 Form 10-K and subsequent filings with the Securities and Exchange Commission (SEC), and are available on our website (zionsbancorporation.com) and from the SEC (sec.gov).
Except to the extent required by law, we specifically disclaim any obligation to update any factors or to publicly announce the revisions to any forward-looking statements to reflect future events or developments.
- more -
ZIONS BANCORPORATION, N.A.
Press Release – Page 8
January 24, 2022
FINANCIAL HIGHLIGHTS
(Unaudited)
| Three Months Ended | |||||||||||||||||||||||||||||
| (In millions, except share, per share, and ratio data) | December 31, 2021 | September 30, 2021 | June 30, 2021 | March 31, 2021 | December 31, 2020 | ||||||||||||||||||||||||
BALANCE SHEET 1 | |||||||||||||||||||||||||||||
| Loans held for investment, net of allowance | $ | 50,338 | $ | 50,187 | $ | 50,863 | $ | 52,826 | $ | 52,699 | |||||||||||||||||||
| Total assets | 93,200 | 88,306 | 87,208 | 85,121 | 81,479 | ||||||||||||||||||||||||
| Deposits | 82,789 | 77,884 | 76,105 | 73,853 | 69,653 | ||||||||||||||||||||||||
| Total shareholders’ equity | 7,463 | 7,774 | 8,033 | 7,933 | 7,886 | ||||||||||||||||||||||||
| STATEMENT OF INCOME | |||||||||||||||||||||||||||||
| Net earnings applicable to common shareholders | $ | 207 | $ | 234 | $ | 345 | $ | 314 | $ | 275 | |||||||||||||||||||
| Net interest income | 553 | 555 | 555 | 545 | 550 | ||||||||||||||||||||||||
Taxable-equivalent net interest income 2 | 563 | 562 | 562 | 553 | 557 | ||||||||||||||||||||||||
| Total noninterest income | 190 | 139 | 205 | 169 | 166 | ||||||||||||||||||||||||
| Total noninterest expense | 449 | 429 | 428 | 435 | 424 | ||||||||||||||||||||||||
Adjusted pre-provision net revenue 2 | 288 | 290 | 290 | 253 | 280 | ||||||||||||||||||||||||
| Provision for credit losses | 25 | (46) | (123) | (132) | (67) | ||||||||||||||||||||||||
| SHARE AND PER COMMON SHARE AMOUNTS | |||||||||||||||||||||||||||||
| Net earnings per diluted common share | $ | 1.34 | $ | 1.45 | $ | 2.08 | $ | 1.90 | $ | 1.66 | |||||||||||||||||||
| Dividends | 0.38 | 0.38 | 0.34 | 0.34 | 0.34 | ||||||||||||||||||||||||
Book value per common share 1 | 46.32 | 46.85 | 46.80 | 44.98 | 44.61 | ||||||||||||||||||||||||
Tangible book value per common share 1, 2 | 39.62 | 40.37 | 40.54 | 38.77 | 38.42 | ||||||||||||||||||||||||
| Weighted average share price | 63.69 | 54.78 | 55.86 | 51.34 | 36.86 | ||||||||||||||||||||||||
| Weighted average diluted common shares outstanding (in thousands) | 153,635 | 160,480 | 163,054 | 163,887 | 163,900 | ||||||||||||||||||||||||
Common shares outstanding (in thousands) 1 | 151,625 | 156,530 | 162,248 | 163,800 | 164,090 | ||||||||||||||||||||||||
| SELECTED RATIOS AND OTHER DATA | |||||||||||||||||||||||||||||
| Return on average assets | 0.92 | % | 1.08 | % | 1.65 | % | 1.57 | % | 1.41 | % | |||||||||||||||||||
| Return on average common equity | 11.5 | % | 12.3 | % | 18.6 | % | 17.4 | % | 15.3 | % | |||||||||||||||||||
Return on average tangible common equity 2 | 13.4 | % | 14.2 | % | 21.6 | % | 20.2 | % | 17.8 | % | |||||||||||||||||||
| Net interest margin | 2.58 | % | 2.68 | % | 2.79 | % | 2.86 | % | 2.95 | % | |||||||||||||||||||
| Cost of total deposits, annualized | 0.03 | % | 0.03 | % | 0.04 | % | 0.05 | % | 0.08 | % | |||||||||||||||||||
Efficiency ratio 2 | 60.8 | % | 59.8 | % | 59.1 | % | 63.5 | % | 60.2 | % | |||||||||||||||||||
| Effective tax rate | 20.8 | % | 22.8 | % | 22.2 | % | 21.7 | % | 20.9 | % | |||||||||||||||||||
| Ratio of nonperforming assets to loans and leases and other real estate owned | 0.53 | % | 0.64 | % | 0.60 | % | 0.61 | % | 0.69 | % | |||||||||||||||||||
| Annualized ratio of net loan and lease charge-offs to average loans | 0.01 | % | (0.01) | % | (0.02) | % | 0.06 | % | 0.11 | % | |||||||||||||||||||
Ratio of total allowance for credit losses to loans and leases outstanding 1 | 1.09 | % | 1.04 | % | 1.12 | % | 1.30 | % | 1.56 | % | |||||||||||||||||||
| Full-time equivalent employees | 9,685 | 9,641 | 9,727 | 9,682 | 9,678 | ||||||||||||||||||||||||
CAPITAL RATIOS AND DATA 1 | |||||||||||||||||||||||||||||
Common equity tier 1 capital 3 | $ | 6,068 | $ | 6,236 | $ | 6,383 | $ | 6,206 | $ | 6,013 | |||||||||||||||||||
Risk-weighted assets 3 | 59,600 | 57,459 | 56,339 | 55,402 | 55,866 | ||||||||||||||||||||||||
| Tangible common equity ratio | 6.5 | % | 7.2 | % | 7.6 | % | 7.6 | % | 7.8 | % | |||||||||||||||||||
Common equity tier 1 capital ratio 3 | 10.2 | % | 10.9 | % | 11.3 | % | 11.2 | % | 10.8 | % | |||||||||||||||||||
Tier 1 leverage ratio 3 | 7.2 | % | 7.6 | % | 8.0 | % | 8.3 | % | 8.3 | % | |||||||||||||||||||
Tier 1 risk-based capital ratio 3 | 10.9 | % | 11.6 | % | 12.1 | % | 12.2 | % | 11.8 | % | |||||||||||||||||||
Total risk-based capital ratio 3 | 12.8 | % | 13.6 | % | 14.2 | % | 14.5 | % | 14.1 | % | |||||||||||||||||||
1 At period end.
2 For information on non-GAAP financial measures, see pages 17-19.
3 Current period ratios and amounts represent estimates.
- more -
ZIONS BANCORPORATION, N.A.
Press Release – Page 9
January 24, 2022
CONSOLIDATED BALANCE SHEETS
| (In millions, shares in thousands) | December 31, 2021 | September 30, 2021 | June 30, 2021 | March 31, 2021 | December 31, 2020 | ||||||||||||||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | ||||||||||||||||||||||||||
| ASSETS | |||||||||||||||||||||||||||||
| Cash and due from banks | $ | 595 | $ | 597 | $ | 525 | $ | 576 | $ | 543 | |||||||||||||||||||
| Money market investments: | |||||||||||||||||||||||||||||
| Interest-bearing deposits | 10,283 | 9,442 | 10,086 | 8,427 | 1,074 | ||||||||||||||||||||||||
| Federal funds sold and security resell agreements | 2,133 | 1,858 | 1,714 | 1,315 | 5,765 | ||||||||||||||||||||||||
| Investment securities: | |||||||||||||||||||||||||||||
Held-to-maturity1, at amortized cost | 441 | 459 | 620 | 583 | 636 | ||||||||||||||||||||||||
| Available-for-sale, at fair value | 24,048 | 20,461 | 18,170 | 16,644 | 15,731 | ||||||||||||||||||||||||
| Trading account, at fair value | 372 | 305 | 181 | 189 | 266 | ||||||||||||||||||||||||
| Total securities, net of allowance | 24,861 | 21,225 | 18,971 | 17,416 | 16,633 | ||||||||||||||||||||||||
| Loans held for sale | 83 | 67 | 66 | 77 | 81 | ||||||||||||||||||||||||
| Loans and leases, net of unearned income and fees | 50,851 | 50,678 | 51,398 | 53,472 | 53,476 | ||||||||||||||||||||||||
| Less allowance for loan losses | 513 | 491 | 535 | 646 | 777 | ||||||||||||||||||||||||
| Loans held for investment, net of allowance | 50,338 | 50,187 | 50,863 | 52,826 | 52,699 | ||||||||||||||||||||||||
| Other noninterest-bearing investments | 851 | 868 | 895 | 815 | 817 | ||||||||||||||||||||||||
| Premises, equipment and software, net | 1,319 | 1,282 | 1,239 | 1,236 | 1,209 | ||||||||||||||||||||||||
| Goodwill and intangibles | 1,015 | 1,015 | 1,015 | 1,016 | 1,016 | ||||||||||||||||||||||||
| Other real estate owned | 8 | 21 | 23 | 3 | 4 | ||||||||||||||||||||||||
| Other assets | 1,714 | 1,744 | 1,811 | 1,414 | 1,638 | ||||||||||||||||||||||||
| Total assets | $ | 93,200 | $ | 88,306 | $ | 87,208 | $ | 85,121 | $ | 81,479 | |||||||||||||||||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||||||||||||||||||||||||
| Deposits: | |||||||||||||||||||||||||||||
| Noninterest-bearing demand | $ | 41,053 | $ | 39,150 | $ | 38,128 | $ | 35,882 | $ | 32,494 | |||||||||||||||||||
| Interest-bearing: | |||||||||||||||||||||||||||||
| Savings and money market | 40,114 | 37,046 | 36,037 | 35,762 | 34,571 | ||||||||||||||||||||||||
| Time | 1,622 | 1,688 | 1,940 | 2,209 | 2,588 | ||||||||||||||||||||||||
| Total deposits | 82,789 | 77,884 | 76,105 | 73,853 | 69,653 | ||||||||||||||||||||||||
| Federal funds purchased and other short-term borrowings | 903 | 579 | 741 | 1,032 | 1,572 | ||||||||||||||||||||||||
| Long-term debt | 1,012 | 1,020 | 1,308 | 1,299 | 1,336 | ||||||||||||||||||||||||
| Reserve for unfunded lending commitments | 40 | 38 | 39 | 49 | 58 | ||||||||||||||||||||||||
| Other liabilities | 993 | 1,011 | 982 | 955 | 974 | ||||||||||||||||||||||||
| Total liabilities | 85,737 | 80,532 | 79,175 | 77,188 | 73,593 | ||||||||||||||||||||||||
| Shareholders’ equity: | |||||||||||||||||||||||||||||
| Preferred stock, without par value; authorized 4,400 shares | 440 | 440 | 440 | 566 | 566 | ||||||||||||||||||||||||
Common stock2 ($0.001 par value; authorized 350,000 shares) and additional paid-in capital | 1,928 | 2,245 | 2,565 | 2,653 | 2,686 | ||||||||||||||||||||||||
| Retained earnings | 5,175 | 5,025 | 4,853 | 4,566 | 4,309 | ||||||||||||||||||||||||
| Accumulated other comprehensive income | (80) | 64 | 175 | 148 | 325 | ||||||||||||||||||||||||
| Total shareholders’ equity | 7,463 | 7,774 | 8,033 | 7,933 | 7,886 | ||||||||||||||||||||||||
| Total liabilities and shareholders’ equity | $ | 93,200 | $ | 88,306 | $ | 87,208 | $ | 85,121 | $ | 81,479 | |||||||||||||||||||
1 Held-to-maturity (fair value) | $ | 443 | $ | 461 | $ | 622 | $ | 584 | $ | 640 | |||||||||||||||||||
2 Common shares (issued and outstanding) | 151,625 | 156,530 | 162,248 | 163,800 | 164,090 | ||||||||||||||||||||||||
- more -
ZIONS BANCORPORATION, N.A.
Press Release – Page 10
January 24, 2022
CONSOLIDATED STATEMENTS OF INCOME
| (Unaudited) | Three Months Ended | ||||||||||||||||||||||||||||
| (In millions, except share and per share amounts) | December 31, 2021 | September 30, 2021 | June 30, 2021 | March 31, 2021 | December 31, 2020 | ||||||||||||||||||||||||
| Interest income: | |||||||||||||||||||||||||||||
| Interest and fees on loans | $ | 471 | $ | 484 | $ | 492 | $ | 488 | $ | 499 | |||||||||||||||||||
| Interest on money market investments | 7 | 7 | 4 | 3 | 3 | ||||||||||||||||||||||||
| Interest on securities | 88 | 78 | 74 | 71 | 69 | ||||||||||||||||||||||||
| Total interest income | 566 | 569 | 570 | 562 | 571 | ||||||||||||||||||||||||
| Interest expense: | |||||||||||||||||||||||||||||
| Interest on deposits | 7 | 7 | 7 | 9 | 13 | ||||||||||||||||||||||||
| Interest on short- and long-term borrowings | 6 | 7 | 8 | 8 | 8 | ||||||||||||||||||||||||
| Total interest expense | 13 | 14 | 15 | 17 | 21 | ||||||||||||||||||||||||
| Net interest income | 553 | 555 | 555 | 545 | 550 | ||||||||||||||||||||||||
| Provision for credit losses: | |||||||||||||||||||||||||||||
| Provision for loan losses | 23 | (45) | (113) | (123) | (61) | ||||||||||||||||||||||||
| Provision for unfunded lending commitments | 2 | (1) | (10) | (9) | (6) | ||||||||||||||||||||||||
| Total provision for credit losses | 25 | (46) | (123) | (132) | (67) | ||||||||||||||||||||||||
| Net interest income after provision for credit losses | 528 | 601 | 678 | 677 | 617 | ||||||||||||||||||||||||
| Noninterest income: | |||||||||||||||||||||||||||||
| Commercial account fees | 34 | 34 | 34 | 32 | 32 | ||||||||||||||||||||||||
| Card fees | 25 | 25 | 24 | 21 | 22 | ||||||||||||||||||||||||
| Retail and business banking fees | 19 | 20 | 18 | 17 | 18 | ||||||||||||||||||||||||
| Loan-related fees and income | 22 | 27 | 21 | 25 | 25 | ||||||||||||||||||||||||
| Capital markets and foreign exchange fees | 24 | 17 | 17 | 15 | 19 | ||||||||||||||||||||||||
| Wealth management fees | 13 | 13 | 12 | 12 | 10 | ||||||||||||||||||||||||
| Other customer-related fees | 15 | 15 | 13 | 11 | 13 | ||||||||||||||||||||||||
| Customer-related fees | 152 | 151 | 139 | 133 | 139 | ||||||||||||||||||||||||
| Fair value and nonhedge derivative income (loss) | (1) | 2 | (5) | 18 | 8 | ||||||||||||||||||||||||
| Dividends and other income | 19 | 9 | 8 | 7 | 7 | ||||||||||||||||||||||||
| Securities gains (losses), net | 20 | (23) | 63 | 11 | 12 | ||||||||||||||||||||||||
| Total noninterest income | 190 | 139 | 205 | 169 | 166 | ||||||||||||||||||||||||
| Noninterest expense: | |||||||||||||||||||||||||||||
| Salaries and employee benefits | 282 | 285 | 272 | 288 | 277 | ||||||||||||||||||||||||
| Occupancy, net | 32 | 33 | 33 | 33 | 33 | ||||||||||||||||||||||||
| Furniture, equipment and software, net | 33 | 31 | 32 | 32 | 30 | ||||||||||||||||||||||||
| Other real estate expense, net | — | — | — | — | 1 | ||||||||||||||||||||||||
| Credit-related expense | 7 | 7 | 6 | 6 | 6 | ||||||||||||||||||||||||
| Professional and legal services | 15 | 16 | 17 | 20 | 19 | ||||||||||||||||||||||||
| Advertising | 6 | 4 | 4 | 5 | 6 | ||||||||||||||||||||||||
| FDIC premiums | 7 | 5 | 6 | 7 | 6 | ||||||||||||||||||||||||
| Other | 67 | 48 | 58 | 44 | 46 | ||||||||||||||||||||||||
| Total noninterest expense | 449 | 429 | 428 | 435 | 424 | ||||||||||||||||||||||||
| Income before income taxes | 269 | 311 | 455 | 411 | 359 | ||||||||||||||||||||||||
| Income taxes | 56 | 71 | 101 | 89 | 75 | ||||||||||||||||||||||||
| Net income | 213 | 240 | 354 | 322 | 284 | ||||||||||||||||||||||||
| Preferred stock dividends | (6) | (6) | (9) | (8) | (9) | ||||||||||||||||||||||||
| Net earnings applicable to common shareholders | $ | 207 | $ | 234 | $ | 345 | $ | 314 | $ | 275 | |||||||||||||||||||
| Weighted average common shares outstanding during the period: | |||||||||||||||||||||||||||||
| Basic shares (in thousands) | 153,248 | 160,221 | 162,742 | 163,551 | 163,658 | ||||||||||||||||||||||||
| Diluted shares (in thousands) | 153,635 | 160,480 | 163,054 | 163,887 | 163,900 | ||||||||||||||||||||||||
| Net earnings per common share: | |||||||||||||||||||||||||||||
| Basic | $ | 1.34 | $ | 1.45 | $ | 2.08 | $ | 1.90 | $ | 1.66 | |||||||||||||||||||
| Diluted | 1.34 | 1.45 | 2.08 | 1.90 | 1.66 | ||||||||||||||||||||||||
- more -
ZIONS BANCORPORATION, N.A.
Press Release – Page 11
January 24, 2022
CONSOLIDATED STATEMENTS OF INCOME
| Year Ended December 31, | |||||||||||||||||
| (In millions, except share and per share amounts) | 2021 | 2020 | 2019 | ||||||||||||||
| (Unaudited) | |||||||||||||||||
| Interest income: | |||||||||||||||||
| Interest and fees on loans | $ | 1,935 | $ | 2,050 | $ | 2,289 | |||||||||||
| Interest on money market investments | 21 | 14 | 32 | ||||||||||||||
| Interest on securities | 311 | 304 | 362 | ||||||||||||||
| Total interest income | 2,267 | 2,368 | 2,683 | ||||||||||||||
| Interest expense: | |||||||||||||||||
| Interest on deposits | 30 | 105 | 254 | ||||||||||||||
| Interest on short- and long-term borrowings | 29 | 47 | 157 | ||||||||||||||
| Total interest expense | 59 | 152 | 411 | ||||||||||||||
| Net interest income | 2,208 | 2,216 | 2,272 | ||||||||||||||
| Provision for credit losses: | |||||||||||||||||
| Provision for loan losses | (258) | 385 | 37 | ||||||||||||||
| Provision for unfunded lending commitments | (18) | 29 | 2 | ||||||||||||||
| Total provision for credit losses | (276) | 414 | 39 | ||||||||||||||
| Net interest income after provision for loan losses | 2,484 | 1,802 | 2,233 | ||||||||||||||
| Noninterest income: | |||||||||||||||||
| Commercial account fees | 134 | 125 | 121 | ||||||||||||||
| Card fees | 95 | 82 | 92 | ||||||||||||||
| Retail and business banking fees | 74 | 68 | 78 | ||||||||||||||
| Loan-related fees and income | 95 | 109 | 75 | ||||||||||||||
| Capital markets and foreign exchange fees | 73 | 77 | 78 | ||||||||||||||
| Wealth management fees | 50 | 44 | 40 | ||||||||||||||
| Other customer-related fees | 54 | 44 | 41 | ||||||||||||||
| Customer-related fees | 575 | 549 | 525 | ||||||||||||||
| Fair value and nonhedge derivative income (loss) | 14 | (6) | (9) | ||||||||||||||
| Dividends and other investment income | 43 | 24 | 43 | ||||||||||||||
| Securities gains, net | 71 | 7 | 3 | ||||||||||||||
| Total noninterest income | 703 | 574 | 562 | ||||||||||||||
| Noninterest expense: | |||||||||||||||||
| Salaries and employee benefits | 1,127 | 1,087 | 1,141 | ||||||||||||||
| Occupancy, net | 131 | 130 | 133 | ||||||||||||||
| Furniture, equipment and software, net | 128 | 127 | 135 | ||||||||||||||
| Other real estate expense, net | — | 1 | (3) | ||||||||||||||
| Credit-related expense | 26 | 22 | 20 | ||||||||||||||
| Professional and legal services | 68 | 52 | 47 | ||||||||||||||
| Advertising | 19 | 19 | 19 | ||||||||||||||
| FDIC premiums | 25 | 25 | 25 | ||||||||||||||
| Other | 217 | 241 | 225 | ||||||||||||||
| Total noninterest expense | 1,741 | 1,704 | 1,742 | ||||||||||||||
| Income before income taxes | 1,446 | 672 | 1,053 | ||||||||||||||
| Income taxes | 317 | 133 | 237 | ||||||||||||||
| Net income | 1,129 | 539 | 816 | ||||||||||||||
| Preferred stock dividends | (29) | (34) | (34) | ||||||||||||||
| Net earnings applicable to common shareholders | $ | 1,100 | $ | 505 | $ | 782 | |||||||||||
| Weighted average common shares outstanding during the year: | |||||||||||||||||
| Basic shares (in thousands) | 159,913 | 163,737 | 175,984 | ||||||||||||||
| Diluted shares (in thousands) | 160,234 | 165,613 | 186,504 | ||||||||||||||
| Net earnings per common share: | |||||||||||||||||
| Basic | $ | 6.80 | $ | 3.06 | $ | 4.41 | |||||||||||
| Diluted | 6.79 | 3.02 | 4.16 | ||||||||||||||
- more -
ZIONS BANCORPORATION, N.A.
Press Release – Page 12
January 24, 2022
Loan Balances Held for Investment by Portfolio Type
(Unaudited)
| (In millions) | December 31, 2021 | September 30, 2021 | June 30, 2021 | March 31, 2021 | December 31, 2020 | ||||||||||||||||||||||||
| Commercial: | |||||||||||||||||||||||||||||
| Commercial and industrial | $ | 13,867 | $ | 13,230 | $ | 12,947 | $ | 12,843 | $ | 13,444 | |||||||||||||||||||
| PPP | 1,855 | 3,080 | 4,461 | 6,465 | 5,572 | ||||||||||||||||||||||||
| Leasing | 327 | 293 | 307 | 310 | 320 | ||||||||||||||||||||||||
| Owner occupied | 8,733 | 8,446 | 8,231 | 8,112 | 8,185 | ||||||||||||||||||||||||
| Municipal | 3,658 | 3,400 | 3,215 | 3,234 | 2,951 | ||||||||||||||||||||||||
| Total commercial | 28,440 | 28,449 | 29,161 | 30,964 | 30,472 | ||||||||||||||||||||||||
| Commercial real estate: | |||||||||||||||||||||||||||||
| Construction and land development | 2,757 | 2,843 | 2,576 | 2,443 | 2,345 | ||||||||||||||||||||||||
| Term | 9,441 | 9,310 | 9,532 | 9,617 | 9,759 | ||||||||||||||||||||||||
| Total commercial real estate | 12,198 | 12,153 | 12,108 | 12,060 | 12,104 | ||||||||||||||||||||||||
| Consumer: | |||||||||||||||||||||||||||||
| Home equity credit line | 3,016 | 2,834 | 2,727 | 2,695 | 2,745 | ||||||||||||||||||||||||
| 1-4 family residential | 6,050 | 6,140 | 6,269 | 6,630 | 6,969 | ||||||||||||||||||||||||
| Construction and other consumer real estate | 638 | 584 | 593 | 589 | 630 | ||||||||||||||||||||||||
| Bankcard and other revolving plans | 396 | 395 | 415 | 409 | 432 | ||||||||||||||||||||||||
| Other | 113 | 123 | 125 | 125 | 124 | ||||||||||||||||||||||||
| Total consumer | 10,213 | 10,076 | 10,129 | 10,448 | 10,900 | ||||||||||||||||||||||||
| Loans and leases, net of unearned income and fees | $ | 50,851 | $ | 50,678 | $ | 51,398 | $ | 53,472 | $ | 53,476 | |||||||||||||||||||
Nonperforming Assets
(Unaudited)
| (In millions) | December 31, 2021 | September 30, 2021 | June 30, 2021 | March 31, 2021 | December 31, 2020 | ||||||||||||||||||||||||
Nonaccrual loans1 | $ | 271 | $ | 323 | $ | 307 | $ | 324 | $ | 367 | |||||||||||||||||||
Other real estate owned2 | 1 | 1 | 1 | 3 | 4 | ||||||||||||||||||||||||
| Total nonperforming assets | $ | 272 | $ | 324 | $ | 308 | $ | 327 | $ | 371 | |||||||||||||||||||
Ratio of nonperforming assets to loans1 and leases and other real estate owned2 | 0.53 | % | 0.64 | % | 0.60 | % | 0.61 | % | 0.69 | % | |||||||||||||||||||
| Accruing loans past due 90 days or more | $ | 8 | $ | 4 | $ | 6 | $ | 9 | $ | 12 | |||||||||||||||||||
Ratio of accruing loans past due 90 days or more to loans1 and leases | 0.02 | % | 0.01 | % | 0.01 | % | 0.02 | % | 0.02 | % | |||||||||||||||||||
| Nonaccrual loans and accruing loans past due 90 days or more | $ | 279 | $ | 327 | $ | 313 | $ | 333 | $ | 379 | |||||||||||||||||||
Ratio of nonaccrual loans and accruing loans past due 90 days or more to loans1 and leases | 0.55 | % | 0.64 | % | 0.61 | % | 0.62 | % | 0.71 | % | |||||||||||||||||||
Accruing loans past due 30-89 days3 | $ | 70 | $ | 114 | $ | 29 | $ | 100 | $ | 112 | |||||||||||||||||||
| Restructured loans included in nonaccrual loans | 105 | 121 | 128 | 134 | 113 | ||||||||||||||||||||||||
| Restructured loans on accrual | 221 | 231 | 330 | 280 | 198 | ||||||||||||||||||||||||
| Classified loans | 1,236 | 1,397 | 1,557 | 1,660 | 1,641 | ||||||||||||||||||||||||
1 Includes loans held for sale.
2 Does not include banking premises held for sale.
3 Includes $35 million of PPP loans at December 31, 2021, which we expect will be paid in full by either the borrower or the SBA.
- more -
ZIONS BANCORPORATION, N.A.
Press Release – Page 13
January 24, 2022
Allowance for Credit Losses
(Unaudited)
| Three Months Ended | |||||||||||||||||||||||||||||
| (In millions) | December 31, 2021 | September 30, 2021 | June 30, 2021 | March 31, 2021 | December 31, 2020 | ||||||||||||||||||||||||
| Allowance for Loan Losses | |||||||||||||||||||||||||||||
| Balance at beginning of period | $ | 491 | $ | 535 | $ | 646 | $ | 777 | $ | 853 | |||||||||||||||||||
| Provision for loan losses | 23 | (45) | (113) | (123) | (61) | ||||||||||||||||||||||||
| Loan and lease charge-offs | 11 | 8 | 8 | 21 | 21 | ||||||||||||||||||||||||
| Less: Recoveries | 10 | 9 | 10 | 13 | 6 | ||||||||||||||||||||||||
| Net loan and lease charge-offs | 1 | (1) | (2) | 8 | 15 | ||||||||||||||||||||||||
| Balance at end of period | $ | 513 | $ | 491 | $ | 535 | $ | 646 | $ | 777 | |||||||||||||||||||
Ratio of allowance for loan losses to loans1 and leases, at period end | 1.01 | % | 0.97 | % | 1.04 | % | 1.21 | % | 1.45 | % | |||||||||||||||||||
Ratio of allowance for loan losses to nonaccrual loans1 at period end | 189 | % | 152 | % | 175 | % | 199 | % | 212 | % | |||||||||||||||||||
| Annualized ratio of net loan and lease charge-offs to average loans | 0.01 | % | (0.01) | % | (0.02) | % | 0.06 | % | 0.11 | % | |||||||||||||||||||
| Annualized ratio of net loan and lease charge-offs to average loans (excluding PPP loans) | 0.01 | % | (0.01) | % | (0.02) | % | 0.07 | % | 0.13 | % | |||||||||||||||||||
| Reserve for Unfunded Lending Commitments | |||||||||||||||||||||||||||||
| Balance at beginning of period | $ | 38 | $ | 39 | $ | 49 | $ | 58 | $ | 64 | |||||||||||||||||||
| Provision for unfunded lending commitments | 2 | (1) | (10) | (9) | (6) | ||||||||||||||||||||||||
| Balance at end of period | $ | 40 | $ | 38 | $ | 39 | $ | 49 | $ | 58 | |||||||||||||||||||
| Allowance for Credit Losses | |||||||||||||||||||||||||||||
| Allowance for loan losses | $ | 513 | $ | 491 | $ | 535 | $ | 646 | $ | 777 | |||||||||||||||||||
| Reserve for unfunded lending commitments | 40 | 38 | 39 | 49 | 58 | ||||||||||||||||||||||||
| Total allowance for credit losses | $ | 553 | $ | 529 | $ | 574 | $ | 695 | $ | 835 | |||||||||||||||||||
Ratio of total allowance for credit losses to loans1 and leases outstanding, at period end | 1.09 | % | 1.04 | % | 1.12 | % | 1.30 | % | 1.56 | % | |||||||||||||||||||
Ratio of total allowance for credit losses to loans1 and leases outstanding (excluding PPP loans), at period end | 1.13 | % | 1.11 | % | 1.22 | % | 1.48 | % | 1.74 | % | |||||||||||||||||||
1 Does not include loans held for sale.
- more -
ZIONS BANCORPORATION, N.A.
Press Release – Page 14
January 24, 2022
Nonaccrual Loans by Portfolio Type
(Unaudited)
| (In millions) | December 31, 2021 | September 30, 2021 | June 30, 2021 | March 31, 2021 | December 31, 2020 | ||||||||||||||||||||||||
| Loans held for sale | $ | — | $ | — | $ | 1 | $ | — | $ | — | |||||||||||||||||||
| Commercial: | |||||||||||||||||||||||||||||
| Commercial and industrial | $ | 124 | $ | 157 | $ | 111 | $ | 119 | $ | 140 | |||||||||||||||||||
| PPP | 3 | — | 1 | — | — | ||||||||||||||||||||||||
| Leasing | — | — | — | — | — | ||||||||||||||||||||||||
| Owner occupied | 57 | 67 | 69 | 74 | 76 | ||||||||||||||||||||||||
| Municipal | — | — | — | — | — | ||||||||||||||||||||||||
| Total commercial | 184 | 224 | 181 | 193 | 216 | ||||||||||||||||||||||||
| Commercial real estate: | |||||||||||||||||||||||||||||
| Construction and land development | — | — | — | — | — | ||||||||||||||||||||||||
| Term | 20 | 25 | 28 | 31 | 31 | ||||||||||||||||||||||||
| Total commercial real estate | 20 | 25 | 28 | 31 | 31 | ||||||||||||||||||||||||
| Consumer: | |||||||||||||||||||||||||||||
| Home equity credit line | 14 | 15 | 18 | 19 | 16 | ||||||||||||||||||||||||
| 1-4 family residential | 52 | 58 | 78 | 80 | 103 | ||||||||||||||||||||||||
| Construction and other consumer real estate | — | — | — | — | — | ||||||||||||||||||||||||
| Bankcard and other revolving plans | 1 | 1 | 1 | 1 | 1 | ||||||||||||||||||||||||
| Other | — | — | — | — | — | ||||||||||||||||||||||||
| Total consumer | 67 | 74 | 97 | 100 | 120 | ||||||||||||||||||||||||
| Total nonaccrual loans | $ | 271 | $ | 323 | $ | 307 | $ | 324 | $ | 367 | |||||||||||||||||||
Net Charge-Offs by Portfolio Type
(Unaudited)
| (In millions) | December 31, 2021 | September 30, 2021 | June 30, 2021 | March 31, 2021 | December 31, 2020 | ||||||||||||||||||||||||
| Commercial: | |||||||||||||||||||||||||||||
| Commercial and industrial | $ | 3 | $ | (2) | $ | (2) | $ | 8 | $ | 15 | |||||||||||||||||||
| PPP | — | — | — | — | — | ||||||||||||||||||||||||
| Leasing | — | — | — | — | — | ||||||||||||||||||||||||
| Owner occupied | — | (1) | — | — | — | ||||||||||||||||||||||||
| Municipal | — | — | — | — | — | ||||||||||||||||||||||||
| Total commercial | 3 | (3) | (2) | 8 | 15 | ||||||||||||||||||||||||
| Commercial real estate: | |||||||||||||||||||||||||||||
| Construction and land development | (3) | — | — | — | — | ||||||||||||||||||||||||
| Term | — | — | — | — | — | ||||||||||||||||||||||||
| Total commercial real estate | (3) | — | — | — | — | ||||||||||||||||||||||||
| Consumer: | |||||||||||||||||||||||||||||
| Home equity credit line | — | 1 | (1) | (1) | — | ||||||||||||||||||||||||
| 1-4 family residential | — | 1 | — | (1) | (1) | ||||||||||||||||||||||||
| Construction and other consumer real estate | — | — | — | — | — | ||||||||||||||||||||||||
| Bankcard and other revolving plans | — | — | 1 | 1 | — | ||||||||||||||||||||||||
| Other | 1 | — | — | 1 | 1 | ||||||||||||||||||||||||
| Total consumer loans | 1 | 2 | — | — | — | ||||||||||||||||||||||||
| Total net charge-offs (recoveries) | $ | 1 | $ | (1) | $ | (2) | $ | 8 | $ | 15 | |||||||||||||||||||
- more -
ZIONS BANCORPORATION, N.A.
Press Release – Page 15
January 24, 2022
CONSOLIDATED AVERAGE BALANCE SHEETS, YIELDS AND RATES
| (Unaudited) | Three Months Ended | ||||||||||||||||||||||||||||||||||
| December 31, 2021 | September 30, 2021 | December 31, 2020 | |||||||||||||||||||||||||||||||||
| (In millions) | Average balance | Average yield/rate 1 | Average balance | Average yield/rate 1 | Average balance | Average yield/rate 1 | |||||||||||||||||||||||||||||
| ASSETS | |||||||||||||||||||||||||||||||||||
| Money market investments: | |||||||||||||||||||||||||||||||||||
| Interest-bearing deposits | $ | 11,155 | 0.15 | % | $ | 10,977 | 0.15 | % | $ | 906 | 0.26 | % | |||||||||||||||||||||||
| Federal funds sold and security resell agreements | 2,189 | 0.49 | % | 1,739 | 0.50 | % | 4,544 | 0.20 | % | ||||||||||||||||||||||||||
| Total money market investments | 13,344 | 0.21 | % | 12,716 | 0.20 | % | 5,450 | 0.21 | % | ||||||||||||||||||||||||||
| Securities: | |||||||||||||||||||||||||||||||||||
| Held-to-maturity | 451 | 3.18 | % | 557 | 2.87 | % | 577 | 3.49 | % | ||||||||||||||||||||||||||
| Available-for-sale | 21,661 | 1.52 | % | 18,814 | 1.56 | % | 14,926 | 1.70 | % | ||||||||||||||||||||||||||
| Trading account | 342 | 4.76 | % | 199 | 4.41 | % | 198 | 4.55 | % | ||||||||||||||||||||||||||
| Total securities | 22,454 | 1.61 | % | 19,570 | 1.63 | % | 15,701 | 1.81 | % | ||||||||||||||||||||||||||
| Loans held for sale | 79 | 1.39 | % | 52 | 3.03 | % | 62 | 2.32 | % | ||||||||||||||||||||||||||
Loans and leases:2 | |||||||||||||||||||||||||||||||||||
| Commercial - excluding PPP loans | 25,899 | 3.75 | % | 24,854 | 3.76 | % | 24,583 | 3.91 | % | ||||||||||||||||||||||||||
| Commercial - PPP loans | 2,439 | 7.16 | % | 3,795 | 6.66 | % | 6,310 | 3.50 | % | ||||||||||||||||||||||||||
| Commercial real estate | 12,228 | 3.39 | % | 12,144 | 3.42 | % | 12,013 | 3.55 | % | ||||||||||||||||||||||||||
| Consumer | 10,125 | 3.29 | % | 10,058 | 3.38 | % | 11,068 | 3.58 | % | ||||||||||||||||||||||||||
| Total loans and leases | 50,691 | 3.73 | % | 50,851 | 3.82 | % | 53,974 | 3.71 | % | ||||||||||||||||||||||||||
| Total interest-earning assets | 86,568 | 2.64 | % | 83,189 | 2.75 | % | 75,187 | 3.06 | % | ||||||||||||||||||||||||||
| Cash and due from banks | 629 | 597 | 601 | ||||||||||||||||||||||||||||||||
| Allowance for credit losses on loans and debt securities | (495) | (536) | (854) | ||||||||||||||||||||||||||||||||
| Goodwill and intangibles | 1,015 | 1,015 | 1,016 | ||||||||||||||||||||||||||||||||
| Other assets | 4,168 | 4,291 | 4,110 | ||||||||||||||||||||||||||||||||
| Total assets | $ | 91,885 | $ | 88,556 | $ | 80,060 | |||||||||||||||||||||||||||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||||||||||||||||||||||||||||||
| Interest-bearing deposits: | |||||||||||||||||||||||||||||||||||
| Savings and money market | $ | 38,349 | 0.05 | % | $ | 37,262 | 0.05 | % | $ | 33,305 | 0.09 | % | |||||||||||||||||||||||
| Time | 1,662 | 0.29 | % | 1,829 | 0.32 | % | 2,925 | 0.76 | % | ||||||||||||||||||||||||||
| Total interest-bearing deposits | 40,011 | 0.06 | % | 39,091 | 0.07 | % | 36,230 | 0.14 | % | ||||||||||||||||||||||||||
| Borrowed funds: | |||||||||||||||||||||||||||||||||||
| Federal funds purchased and other short-term borrowings | 641 | 0.07 | % | 630 | 0.08 | % | 1,336 | 0.08 | % | ||||||||||||||||||||||||||
| Long-term debt | 1,017 | 2.54 | % | 1,204 | 2.34 | % | 1,342 | 2.25 | % | ||||||||||||||||||||||||||
| Total borrowed funds | 1,658 | 1.59 | % | 1,834 | 1.56 | % | 2,678 | 1.17 | % | ||||||||||||||||||||||||||
| Total interest-bearing funds | 41,669 | 0.12 | % | 40,925 | 0.13 | % | 38,908 | 0.21 | % | ||||||||||||||||||||||||||
| Noninterest-bearing demand deposits | 41,397 | 38,320 | 32,036 | ||||||||||||||||||||||||||||||||
| Other liabilities | 1,233 | 1,302 | 1,384 | ||||||||||||||||||||||||||||||||
| Total liabilities | 84,299 | 80,547 | 72,328 | ||||||||||||||||||||||||||||||||
| Shareholders’ equity: | |||||||||||||||||||||||||||||||||||
| Preferred equity | 440 | 440 | 566 | ||||||||||||||||||||||||||||||||
| Common equity | 7,146 | 7,569 | 7,166 | ||||||||||||||||||||||||||||||||
| Total shareholders’ equity | 7,586 | 8,009 | 7,732 | ||||||||||||||||||||||||||||||||
| Total liabilities and shareholders’ equity | $ | 91,885 | $ | 88,556 | $ | 80,060 | |||||||||||||||||||||||||||||
| Spread on average interest-bearing funds | 2.52 | % | 2.62 | % | 2.85 | % | |||||||||||||||||||||||||||||
| Impact of net noninterest-bearing sources of funds | 0.06 | % | 0.06 | % | 0.10 | % | |||||||||||||||||||||||||||||
| Net interest margin | 2.58 | % | 2.68 | % | 2.95 | % | |||||||||||||||||||||||||||||
| Memo: total loans and leases, excluding PPP loans | 48,252 | 3.56 | % | 47,056 | 3.59 | % | 47,664 | 3.74 | % | ||||||||||||||||||||||||||
| Memo: total cost of deposits | 0.03 | % | 0.03 | % | 0.08 | % | |||||||||||||||||||||||||||||
| Memo: total deposits and interest-bearing liabilities | 83,066 | 0.06 | % | 79,245 | 0.07 | % | 70,944 | 0.12 | % | ||||||||||||||||||||||||||
1 Rates are calculated using amounts in thousands and a tax rate of 21% for the periods presented.
2 Net of unamortized purchase premiums, discounts, and deferred loan fees and costs.
- more -
ZIONS BANCORPORATION, N.A.
Press Release – Page 16
January 24, 2022
CONSOLIDATED AVERAGE BALANCE SHEETS, YIELDS AND RATES
| (Unaudited) | Twelve Months Ended | ||||||||||||||||||||||||||||||||||
| December 31, 2021 | December 31, 2020 | December 31, 2019 | |||||||||||||||||||||||||||||||||
| (In millions) | Average balance | Average yield/rate 1 | Average balance | Average yield/rate 1 | Average balance | Average yield/rate 1 | |||||||||||||||||||||||||||||
| ASSETS | |||||||||||||||||||||||||||||||||||
| Money market investments: | |||||||||||||||||||||||||||||||||||
| Interest-bearing deposits | $ | 8,917 | 0.14 | % | $ | 965 | 0.49 | % | $ | 717 | 2.23 | % | |||||||||||||||||||||||
| Federal funds sold and security resell agreements | 2,129 | 0.40 | % | 2,089 | 0.44 | % | 629 | 2.61 | % | ||||||||||||||||||||||||||
| Total money market investments | 11,046 | 0.19 | % | 3,054 | 0.46 | % | 1,346 | 2.41 | % | ||||||||||||||||||||||||||
| Securities: | |||||||||||||||||||||||||||||||||||
| Held-to-maturity | 562 | 2.97 | % | 618 | 3.54 | % | 706 | 3.69 | % | ||||||||||||||||||||||||||
| Available-for-sale | 18,365 | 1.59 | % | 14,208 | 2.00 | % | 14,389 | 2.36 | % | ||||||||||||||||||||||||||
| Trading account | 246 | 4.43 | % | 167 | 4.36 | % | 147 | 4.45 | % | ||||||||||||||||||||||||||
| Total securities | 19,173 | 1.67 | % | 14,993 | 2.09 | % | 15,242 | 2.45 | % | ||||||||||||||||||||||||||
| Loans held for sale | 65 | 2.35 | % | 96 | 3.89 | % | 89 | 2.90 | % | ||||||||||||||||||||||||||
Loans and leases:2 | |||||||||||||||||||||||||||||||||||
| Commercial - excluding PPP loans | 25,014 | 3.80 | % | 25,193 | 4.11 | % | 24,990 | 4.86 | % | ||||||||||||||||||||||||||
| Commercial - PPP loans | 4,566 | 5.16 | % | 4,534 | 3.22 | % | — | — | % | ||||||||||||||||||||||||||
| Commercial real estate | 12,136 | 3.44 | % | 11,854 | 3.87 | % | 11,675 | 5.11 | % | ||||||||||||||||||||||||||
| Consumer | 10,267 | 3.44 | % | 11,435 | 3.71 | % | 11,600 | 4.22 | % | ||||||||||||||||||||||||||
| Total loans and leases | 51,983 | 3.76 | % | 53,016 | 3.89 | % | 48,265 | 4.77 | % | ||||||||||||||||||||||||||
| Total interest-earning assets | 82,267 | 2.79 | % | 71,159 | 3.37 | % | 64,942 | 4.17 | % | ||||||||||||||||||||||||||
| Cash and due from banks | 605 | 619 | 610 | ||||||||||||||||||||||||||||||||
| Allowance for credit losses on loans and debt securities | (612) | (733) | (501) | ||||||||||||||||||||||||||||||||
| Goodwill and intangibles | 1,015 | 1,015 | 1,014 | ||||||||||||||||||||||||||||||||
| Other assets | 4,122 | 3,997 | 3,506 | ||||||||||||||||||||||||||||||||
| Total assets | $ | 87,397 | $ | 76,057 | $ | 69,571 | |||||||||||||||||||||||||||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||||||||||||||||||||||||||||||
| Interest-bearing deposits: | |||||||||||||||||||||||||||||||||||
| Savings and money market | $ | 36,717 | 0.06 | % | $ | 31,100 | 0.19 | % | $ | 26,852 | 0.60 | % | |||||||||||||||||||||||
| Time | 2,020 | 0.41 | % | 3,706 | 1.22 | % | 4,868 | 1.94 | % | ||||||||||||||||||||||||||
| Total interest-bearing deposits | 38,737 | 0.08 | % | 34,806 | 0.30 | % | 31,720 | 0.80 | % | ||||||||||||||||||||||||||
| Borrowed funds: | |||||||||||||||||||||||||||||||||||
| Federal funds purchased and other short-term borrowings | 802 | 0.07 | % | 1,888 | 0.52 | % | 4,719 | 2.36 | % | ||||||||||||||||||||||||||
| Long-term debt | 1,211 | 2.36 | % | 1,544 | 2.45 | % | 1,236 | 3.69 | % | ||||||||||||||||||||||||||
| Total borrowed funds | 2,013 | 1.45 | % | 3,432 | 1.39 | % | 5,955 | 2.64 | % | ||||||||||||||||||||||||||
| Total interest-bearing funds | 40,750 | 0.14 | % | 38,238 | 0.40 | % | 37,675 | 1.09 | % | ||||||||||||||||||||||||||
| Noninterest-bearing demand deposits | 37,520 | 28,883 | 23,361 | ||||||||||||||||||||||||||||||||
| Other liabilities | 1,259 | 1,320 | 1,004 | ||||||||||||||||||||||||||||||||
| Total liabilities | 79,529 | 68,441 | 62,040 | ||||||||||||||||||||||||||||||||
| Shareholders’ equity: | |||||||||||||||||||||||||||||||||||
| Preferred equity | 497 | 566 | 566 | ||||||||||||||||||||||||||||||||
| Common equity | 7,371 | 7,050 | 6,965 | ||||||||||||||||||||||||||||||||
| Total shareholders’ equity | 7,868 | 7,616 | 7,531 | ||||||||||||||||||||||||||||||||
| Total liabilities and shareholders’ equity | $ | 87,397 | $ | 76,057 | $ | 69,571 | |||||||||||||||||||||||||||||
| Spread on average interest-bearing funds | 2.65 | % | 2.97 | % | 3.08 | % | |||||||||||||||||||||||||||||
| Impact of net noninterest-bearing sources of funds | 0.07 | % | 0.18 | % | 0.46 | % | |||||||||||||||||||||||||||||
| Net interest margin | 2.72 | % | 3.15 | % | 3.54 | % | |||||||||||||||||||||||||||||
| Memo: total loans and leases, excluding PPP loans | 47,417 | 3.63 | % | 48,482 | 3.96 | % | 48,265 | 4.77 | % | ||||||||||||||||||||||||||
| Memo: total cost of deposits | 0.04 | % | 0.17 | % | 0.46 | % | |||||||||||||||||||||||||||||
| Memo: total deposits and interest-bearing liabilities | 78,270 | 0.07 | % | 67,121 | 0.22 | % | 61,036 | 0.67 | % | ||||||||||||||||||||||||||
1 Rates are calculated using amounts in thousands and a tax rate of 21% for the periods presented.
2 Net of unamortized purchase premiums, discounts, and deferred loan fees and costs.
- more -
ZIONS BANCORPORATION, N.A.
Press Release – Page 17
January 24, 2022
GAAP to Non-GAAP Reconciliations
(Unaudited)
This press release presents non-GAAP financial measures, in addition to GAAP financial measures, to provide investors with additional information. The adjustments to reconcile from the applicable GAAP financial measures to the non-GAAP financial measures are presented in the following schedules. We consider these adjustments to be relevant to ongoing operating results and to provide a meaningful base for period-to-period and company-to-company comparisons. We use these non-GAAP financial measures to assess our performance, financial position, and for presentations of our performance to investors. We believe that presenting these non-GAAP financial measures permits investors to assess our performance on the same basis as that applied by our management and the financial services industry.
Non-GAAP financial measures have inherent limitations and are not necessarily comparable to similar capital measures that may be presented by other financial services companies. Although non-GAAP financial measures are frequently used by stakeholders to evaluate a company, they have limitations as an analytical tool and should not be considered in isolation or as a substitute for analysis of results reported under GAAP.
Tangible Common Equity and Related Measures
Tangible common equity and related measures are non-GAAP measures that exclude the impact of intangible assets and their related amortization. We believe these non-GAAP measures provide useful information about our use of shareholders’ equity and provide a basis for evaluating the performance of a business more consistently, whether acquired or developed internally.
| Three Months Ended | ||||||||||||||||||||||||||||||||
| (Dollar amounts in millions) | December 31, 2021 | September 30, 2021 | June 30, 2021 | March 31, 2021 | December 31, 2020 | |||||||||||||||||||||||||||
| Return on Average Tangible Common Equity | ||||||||||||||||||||||||||||||||
| Net earnings applicable to common shareholders, net of tax | (a) | $ | 207 | $ | 234 | $ | 345 | $ | 314 | $ | 275 | |||||||||||||||||||||
| Average common equity (GAAP) | $ | 7,146 | $ | 7,569 | $ | 7,436 | $ | 7,333 | $ | 7,166 | ||||||||||||||||||||||
| Average goodwill and intangibles | (1,015) | (1,015) | (1,015) | (1,016) | (1,016) | |||||||||||||||||||||||||||
| Average tangible common equity (non-GAAP) | (b) | $ | 6,131 | $ | 6,554 | $ | 6,421 | $ | 6,317 | $ | 6,150 | |||||||||||||||||||||
| Number of days in quarter | (c) | 92 | 92 | 91 | 90 | 92 | ||||||||||||||||||||||||||
| Number of days in year | (d) | 365 | 365 | 365 | 365 | 366 | ||||||||||||||||||||||||||
| Return on average tangible common equity (non-GAAP) | (a/b/c)*d | 13.4 | % | 14.2 | % | 21.6 | % | 20.2 | % | 17.8 | % | |||||||||||||||||||||
| (In millions, except shares and per share amounts) | December 31, 2021 | September 30, 2021 | June 30, 2021 | March 31, 2021 | December 31, 2020 | |||||||||||||||||||||||||||
| Tangible Book Value per Common Share | ||||||||||||||||||||||||||||||||
| Total shareholders’ equity (GAAP) | $ | 7,463 | $ | 7,774 | $ | 8,033 | $ | 7,933 | $ | 7,886 | ||||||||||||||||||||||
| Preferred stock | (440) | (440) | (440) | (566) | (566) | |||||||||||||||||||||||||||
| Goodwill and intangibles | (1,015) | (1,015) | (1,015) | (1,016) | (1,016) | |||||||||||||||||||||||||||
| Tangible common equity (non-GAAP) | (a) | $ | 6,008 | $ | 6,319 | $ | 6,578 | $ | 6,351 | $ | 6,304 | |||||||||||||||||||||
| Common shares outstanding (in thousands) | (b) | 151,625 | 156,530 | 162,248 | 163,800 | 164,090 | ||||||||||||||||||||||||||
| Tangible book value per common share (non-GAAP) | (a/b) | $ | 39.62 | $ | 40.37 | $ | 40.54 | $ | 38.77 | $ | 38.42 | |||||||||||||||||||||
- more -
ZIONS BANCORPORATION, N.A.
Press Release – Page 18
January 24, 2022
Efficiency Ratio and Adjusted Pre-Provision Net Revenue
The efficiency ratio is a measure of operating expense relative to revenue. We believe the efficiency ratio provides useful information regarding the cost of generating revenue. The methodology of determining the efficiency ratio may differ among companies. We make adjustments to exclude certain items that are not generally expected to recur frequently, as identified in the subsequent schedule, which we believe allow for more consistent comparability among periods. Adjusted noninterest expense provides a measure as to how well we are managing our expenses; adjusted pre-provision net revenue (“PPNR”) enables management and others to assess our ability to generate capital to cover credit losses through a credit cycle. Taxable-equivalent net interest income allows us to assess the comparability of revenue arising from both taxable and tax-exempt sources.
| Three Months Ended | ||||||||||||||||||||||||||||||||
| (In millions) | December 31, 2021 | September 30, 2021 | June 30, 2021 | March 31, 2021 | December 31, 2020 | |||||||||||||||||||||||||||
| Efficiency Ratio | ||||||||||||||||||||||||||||||||
| Noninterest expense (GAAP) | (a) | $ | 449 | $ | 429 | $ | 428 | $ | 435 | $ | 424 | |||||||||||||||||||||
| Adjustments: | ||||||||||||||||||||||||||||||||
| Severance costs | — | 1 | — | — | 1 | |||||||||||||||||||||||||||
| Other real estate expense, net | — | — | — | — | 1 | |||||||||||||||||||||||||||
| Amortization of core deposit and other intangibles | 1 | — | — | — | — | |||||||||||||||||||||||||||
| Restructuring costs | — | — | — | — | (1) | |||||||||||||||||||||||||||
| Pension termination-related expense | — | — | — | (5) | — | |||||||||||||||||||||||||||
SBIC investment success fee accrual 1 | 2 | (4) | 9 | — | — | |||||||||||||||||||||||||||
| Total adjustments | (b) | 3 | (3) | 9 | (5) | 1 | ||||||||||||||||||||||||||
| Adjusted noninterest expense (non-GAAP) | (a-b)=(c) | $ | 446 | $ | 432 | $ | 419 | $ | 440 | $ | 423 | |||||||||||||||||||||
| Net interest income (GAAP) | (d) | $ | 553 | $ | 555 | $ | 555 | $ | 545 | $ | 550 | |||||||||||||||||||||
| Fully taxable-equivalent adjustments | (e) | 10 | 7 | 7 | 8 | 7 | ||||||||||||||||||||||||||
| Taxable-equivalent net interest income (non-GAAP) | (d+e)=(f) | 563 | 562 | 562 | 553 | 557 | ||||||||||||||||||||||||||
| Noninterest income (GAAP) | (g) | 190 | 139 | 205 | 169 | 166 | ||||||||||||||||||||||||||
| Combined income (non-GAAP) | (f+g)=(h) | 753 | 701 | 767 | 722 | 723 | ||||||||||||||||||||||||||
| Adjustments: | ||||||||||||||||||||||||||||||||
| Fair value and nonhedge derivative income (loss) | (1) | 2 | (5) | 18 | 8 | |||||||||||||||||||||||||||
| Securities gains (losses), net | 20 | (23) | 63 | 11 | 12 | |||||||||||||||||||||||||||
| Total adjustments | (i) | 19 | (21) | 58 | 29 | 20 | ||||||||||||||||||||||||||
Adjusted taxable-equivalent revenue (non-GAAP) | (h-i)=(j) | $ | 734 | $ | 722 | $ | 709 | $ | 693 | $ | 703 | |||||||||||||||||||||
| Pre-provision net revenue (PPNR) (non-GAAP) | (h)-(a) | $ | 304 | $ | 272 | $ | 339 | $ | 287 | $ | 299 | |||||||||||||||||||||
| Adjusted PPNR (non-GAAP) | (j)-(c) | 288 | 290 | 290 | 253 | 280 | ||||||||||||||||||||||||||
| Efficiency ratio (non-GAAP) | (c/j) | 60.8 | % | 59.8 | % | 59.1 | % | 63.5 | % | 60.2 | % | |||||||||||||||||||||
1 The success fee accrual is associated with the unrealized gain/(loss) from our SBIC investment in Recursion Pharmaceuticals, Inc., and is adjusted based on the mark-to-market value of the investment. The unrealized gain/(loss) is excluded from the efficiency ratio through securities gains (losses), net.
- more -
ZIONS BANCORPORATION, N.A.
Press Release – Page 19
January 24, 2022
| Twelve Months Ended | ||||||||||||||||||||
| (In millions) | December 31, 2021 | December 31, 2020 | ||||||||||||||||||
| Efficiency Ratio | ||||||||||||||||||||
| Noninterest expense (GAAP) | (a) | $ | 1,741 | $ | 1,704 | |||||||||||||||
| Adjustments: | ||||||||||||||||||||
| Severance costs | 1 | 1 | ||||||||||||||||||
| Other real estate expense | — | 1 | ||||||||||||||||||
| Amortization of core deposit and other intangibles | 1 | — | ||||||||||||||||||
| Restructuring costs | — | 1 | ||||||||||||||||||
| Pension termination-related expense | (5) | 28 | ||||||||||||||||||
SBIC investment success fee accrual 1 | 7 | — | ||||||||||||||||||
| Total adjustments | (b) | 4 | 31 | |||||||||||||||||
| Adjusted noninterest expense (non-GAAP) | (a-b)=(c) | $ | 1,737 | $ | 1,673 | |||||||||||||||
| Net interest income (GAAP) | (d) | $ | 2,208 | $ | 2,216 | |||||||||||||||
| Fully taxable-equivalent adjustments | (e) | 32 | 28 | |||||||||||||||||
| Taxable-equivalent net interest income (non-GAAP) | (d+e)=(f) | 2,240 | 2,244 | |||||||||||||||||
| Noninterest income (GAAP) | (g) | 703 | 574 | |||||||||||||||||
| Combined income (non-GAAP) | (f+g)=(h) | 2,943 | 2,818 | |||||||||||||||||
| Adjustments: | ||||||||||||||||||||
| Fair value and nonhedge derivative loss | 14 | (6) | ||||||||||||||||||
| Securities gains, net | 71 | 7 | ||||||||||||||||||
| Total adjustments | (i) | 85 | 1 | |||||||||||||||||
| Adjusted taxable-equivalent revenue (non-GAAP) | (h-i)=(j) | $ | 2,858 | $ | 2,817 | |||||||||||||||
| Pre-provision net revenue (PPNR) | (h)-(a) | $ | 1,202 | $ | 1,114 | |||||||||||||||
| Adjusted PPNR (non-GAAP) | (j)-(c) | 1,121 | 1,144 | |||||||||||||||||
| Efficiency ratio (non-GAAP) | (c/j) | 60.8 | % | 59.4 | % | |||||||||||||||
1 The success fee accrual is associated with the unrealized gain/(loss) from our SBIC investments and is adjusted based on the mark-to-market value of the investments. The gains/(losses) related to these investments are excluded from the efficiency ratio through securities gains (losses), net.
# # #