Exhibit 99.1
***FOR IMMEDIATE RELEASE***
For: ZIONS BANCORPORATION |
| Contact: Clark Hinckley |
One South Main, Suite 1134 |
| Tel: (801) 524-4787 |
Salt Lake City, Utah |
| July 21, 2004 |
Harris H. Simmons |
|
|
Chairman/Chief Executive Officer |
|
|
ZIONS BANCORPORATION REPORTS SECOND
QUARTER 2004 EARNINGS OF $1.09 PER DILUTED SHARE
SALT LAKE CITY, July 21, 2004 – Zions Bancorporation (“Zions” or “the Company”) (Nasdaq: ZION) today reported second-quarter net income of $98.8 million, or $1.09 per diluted share. Net income and earnings per share increased 6.94% and 6.86% over the $92.4 million, or $1.02 per diluted share for the second quarter of 2003. The return on average common equity was 15.18% in the second quarter of 2004, up from 15.07% for the same period in 2003.
“We are pleased to again report solid quarterly earnings,” stated Harris H. Simmons, chairman and chief executive officer. “Earnings were driven by accelerating loan growth, strong deposit growth, and improving credit quality, partially offset by margin compression. We successfully completed the conversion of National Bank of Arizona onto our operating platforms and, while we incurred some additional expenses in conjunction with the conversion, both customers and shareholders will now begin to benefit from this consolidation.”
- more -
Year-to-date net income for 2004 increased 10.2% to $198.5 million, or $2.19 per diluted share, compared to $180.1 million, or $1.99 per diluted share for the comparable period of 2003. The return on average common equity for the first six months of 2004 was 15.36%, compared to 14.94% for the same period in 2003.
Loan and Deposit Growth
On-balance-sheet net loans and leases at June 30, 2004 were $21.5 billion, an increase of 4.2% (17.0% annualized) from the March 31, 2004 balance of $20.6 billion, and 10.6% from $19.4 billion at June 30, 2003. Loan growth in Arizona and Nevada remained strong for the quarter, adding approximately $400 million in on-balance sheet loans. In addition, loan growth at Zions First National Bank strengthened during the quarter, also adding approximately $400 million to the portfolio.
Total deposits at the end of the second quarter increased 9.0% over the balances reported one year ago to $22.5 billion, and increased at an annualized rate of 18.3% from the balances reported at March 31, 2004. Core deposits increased 9.7% year-over-year, and 18.0%, annualized, for the quarter. The mix of deposits continued to improve with sizeable increases in demand, savings and money market deposits.
Net Interest Income
Taxable-equivalent net interest income of $289.6 million increased 3.5% for the quarter compared to $279.8 million for the second quarter of 2003. The increase reflects the previously discussed loan and deposit growth, partially offset by the effects of a declining net interest margin. For the second quarter of 2004, the net interest margin was 4.20%, compared to 4.32% for the first quarter of 2004 and 4.50% for the second quarter of 2003. The margin was negatively impacted by changes in the balance sheet mix, operations of the newly acquired Van der Moolen UK Ltd. and higher borrowing costs, primarily caused by long-term funding initiatives.
2
Noninterest Income
For the second quarter of 2004, noninterest income increased 6.4% to $107.3 million compared with $100.8 million for the second quarter of 2003, and 1.2% compared to $106.1 million for the first quarter of 2004. Loan sales and servicing income decreased $2.3 million compared to the second quarter of 2003 due primarily to higher levels of prepayments and reduced residential mortgage originations. However, loan sales and servicing income for the second quarter of 2004 increased $2.0 million over the first quarter as loan origination and sales activity improved. Market making, trading and nonhedge derivative income declined $1.7 million compared with the same period in 2003 but was essentially unchanged from the first quarter of 2004. The year-over-year decrease was caused by a $2.5 million decline in trading income, partially offset by an increase in nonhedge derivative income. Fixed income security gains for the second quarter of 2004 increased $2.0 million compared to the second quarter of 2003 as a result of the decision to sell certain debt securities. Noninterest income for the second quarter includes $5.3 million in net losses on venture capital and other equity investments, while for the same period in 2003 net losses were $6.5 million. Adjusted for minority interest and income taxes, these losses reduced net income by $2.2 million and $4.3 million in the second quarters of 2004 and 2003, respectively. “Other” noninterest income for the second quarter of 2004 includes the receipt of a $1.6 million cash litigation settlement.
Noninterest Expense
Noninterest expense for the second quarter of 2004 was $230.0 million, an increase of 6.3% from $216.4 million for the second quarter of 2003, and 3.4% from the $222.3 million in the first quarter of 2004. Salaries and employee benefits increased from the same period in 2003 but decreased from those of the first quarter of 2004. Legal and professional services increased compared with both the second quarter 2003 and first quarter 2004, primarily as a result of the major systems conversions that were completed during the quarter at National Bank of Arizona as part of “Project Unify.”
The efficiency ratio for the second quarter of 2004 was 57.94%, compared to 56.96% for the second quarter of 2003 and 56.48% for the first quarter of 2004.
3
Asset Quality
The ratio of nonperforming assets to net loans and leases and other real estate owned improved to 0.50% at June 30, 2004, compared to 0.53% at March 31, 2004 and 0.61% at June 30, 2003.
For the second quarter of 2004, net loan and lease losses were $10.0 million or 0.19%, annualized, of average loans. This compares with $8.0 million or 0.16%, annualized, for the first quarter of 2004 and $17.2 million or 0.36%, annualized, for the second quarter of 2003. At $271.6 million on June 30, 2004, the allowance for loan losses was 1.26% of total loans and 291.5% of nonperforming loans. In addition, the allowance for unfunded lending commitments increased to $11.1 million at June 30, 2004 from $10.5 million at March 31, 2004.
The provision for loan losses for the second quarter of 2004 was $10.3 million compared to $11.2 million that was provided during the first quarter of 2004 and $18.2 million for the second quarter of 2003. Including the provision for unfunded lending commitments included in other noninterest expense, the total provision for credit losses was $10.9 million for the second quarter of 2004 compared to $9.5 million for the first quarter.
Capital Management
During the second quarter of 2004, Zions repurchased 438,048 shares of its common stock at an average price of $57.09 per share. For the six months ended June 30, 2004, the Company repurchased 943,103 shares at an average per share price of $58.19. On June 14, 2004, the Board of Directors approved a program authorizing the repurchase of up to $50 million of the Company’s common stock. As of June 30, 2004, the entire $50 million was available for share repurchases.
Weighted average common and common-equivalent shares outstanding for the second quarter of 2004 were 90,658,259 compared to 90,905,218 for the first quarter of 2004 and 90,586,065 for the second quarter of 2003. The decrease in shares from the first quarter of 2004 reflects the effects of the stock
4
repurchases for the quarter, which were partially offset by shares issued through stock option exercises.
The Company’s tangible common equity ratio was 6.37% at June 30, 2004, compared to 6.56% at March 31, 2004 and 6.20% at June 30, 2003. The decline in the ratio at June 30, 2004 was principally due to a $56.5 million unrealized decrease in accumulated other comprehensive income, which resulted primarily from the Company’s hedging programs related to interest rate risk management.
Subsequent Event
On July 8, 2004, the second of two previously announced planned sales of branches by Vectra Bank Colorado was closed. The sale resulted in removing approximately $102 million of loans, $114 million of deposits and $8 million of goodwill and core deposit intangibles that were included in Vectra’s June 30, 2004 balance sheet. This transaction resulted in no significant income statement gain or loss.
Conference Call
Zions will host a conference call to discuss these second quarter results at 5:30 p.m. EDT this afternoon (July 21, 2004). Media representatives, analysts and the public are invited to listen to this discussion by calling 1-800-901-5241, or via on-demand webcast. A link to the webcast will be available on the Zions Bancorporation Web site at www.zionsbancorporation.com. A replay of the call will be available from approximately 7:30 p.m. EDT on Wednesday, July 21 through midnight EDT on Wednesday, July 28, by dialing 1-888-286-8010 and entering the passcode (68487573). The webcast of the conference call will also be archived and available until July 28.
About Zions Bancorporation
Zions Bancorporation is one of the nation’s premier financial services companies, consisting of a collection of great banks in select high growth markets. Under local management teams and community identities, Zions operates approximately 400 full-service banking offices in Arizona, California,
5
Colorado, Idaho, Nevada, New Mexico, Utah and Washington. In addition, Zions is a national leader in SBA lending, public finance advisory services, agricultural finance and electronic bond trading. The Company is included in the S&P 500 Index. Investor information and links to subsidiary banks can be accessed at www.zionsbancorporation.com.
Forward-Looking Information
Statements in this news release that are based on other than historical data are forward-looking, within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements provide current expectations or forecasts of future events. These forward-looking statements are not guarantees of future performance, nor should they be relied upon as representing management’s views as of any subsequent date. Forward-looking statements involve significant risks and uncertainties and actual results may differ materially from those presented, either expressed or implied, in this news release. Factors that might cause such differences include, but are not limited to: changes in general economic and financial market conditions, either nationally or locally in areas in which the Company conducts its operations; changes in interest rates; continuing consolidation in the financial services industry; new litigation or changes in existing litigation; increased competitive pressures among financial institutions; legislation or regulatory changes which adversely affect the Company’s operations or business; and changes in accounting policies or procedures as may be required by the Financial Accounting Standards Board or other regulatory agencies. The Company specifically disclaims any obligation to update any factors or to publicly announce the result of revisions to any of the forward-looking statements included herein to reflect future events or developments.
6
ZIONS BANCORPORATION AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS
(Unaudited)
(In thousands, except per share and ratio data) |
| Three Months Ended |
| Six Months Ended |
| ||||||||||||
|
| 2004 |
| 2003 |
| % Change |
| 2004 |
| 2003 |
| % Change |
| ||||
EARNINGS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Taxable-equivalent net interest income |
| $ | 289,630 |
| $ | 279,794 |
| 3.52 | % | $ | 577,244 |
| $ | 551,774 |
| 4.62 | % |
Net interest income |
| 284,245 |
| 273,953 |
| 3.76 | % | 566,428 |
| 540,161 |
| 4.86 | % | ||||
Noninterest income |
| 107,279 |
| 100,805 |
| 6.42 | % | 213,329 |
| 197,166 |
| 8.20 | % | ||||
Provision for loan losses |
| 10,301 |
| 18,150 |
| (43.25 | )% | 21,545 |
| 35,700 |
| (39.65 | )% | ||||
Noninterest expense |
| 229,976 |
| 216,403 |
| 6.27 | % | 452,314 |
| 430,389 |
| 5.09 | % | ||||
Income before income taxes and minority interest |
| 151,247 |
| 140,205 |
| 7.88 | % | 305,898 |
| 271,238 |
| 12.78 | % | ||||
Income taxes |
| 54,631 |
| 48,956 |
| 11.59 | % | 109,345 |
| 95,350 |
| 14.68 | % | ||||
Minority interest |
| (2,226 | ) | (1,159 | ) | 92.06 | % | (1,958 | ) | (3,896 | ) | (49.74 | )% | ||||
Income from continuing operations |
| 98,842 |
| 92,408 |
| 6.96 | % | 198,511 |
| 179,784 |
| 10.42 | % | ||||
Income on discontinued operations |
| — |
| 17 |
| (100.00 | )% | — |
| 345 |
| (100.00 | )% | ||||
Net income |
| 98,842 |
| 92,425 |
| 6.94 | % | 198,511 |
| 180,129 |
| 10.20 | % | ||||
|
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|
|
|
|
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|
|
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| ||||
PER COMMON SHARE |
|
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|
|
|
|
|
|
|
|
|
|
| ||||
Net income (diluted) |
| 1.09 |
| 1.02 |
| 6.86 | % | 2.19 |
| 1.99 |
| 10.05 | % | ||||
Income from continuing operations (diluted) |
| 1.09 |
| 1.02 |
| 6.86 | % | 2.19 |
| 1.98 |
| 10.61 | % | ||||
Income on discontinued operations (diluted) |
| — |
| — |
|
|
| — |
| 0.01 |
| (100.00 | )% | ||||
Dividends |
| 0.32 |
| 0.21 |
| 52.38 | % | 0.62 |
| 0.42 |
| 47.62 | % | ||||
Book value |
|
|
|
|
|
|
| 29.37 |
| 27.63 |
| 6.30 | % | ||||
|
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| ||||
SELECTED RATIOS |
|
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| ||||
Return on average assets |
| 1.28 | % | 1.32 | % |
|
| 1.31 | % | 1.31 | % |
|
| ||||
Return on average common equity |
| 15.18 | % | 15.07 | % |
|
| 15.36 | % | 14.94 | % |
|
| ||||
Efficiency ratio |
| 57.94 | % | 56.96 | % |
|
| 57.21 | % | 57.53 | % |
|
| ||||
Net interest margin |
| 4.20 | % | 4.50 | % |
|
| 4.26 | % | 4.52 | % |
|
| ||||
7
ZIONS BANCORPORATION AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS (Continued)
(Unaudited)
(In thousands, except share and ratio data) |
| Three Months Ended |
| Six Months Ended |
| ||||||||||||
|
| 2004 |
| 2003 |
| % Change |
| 2004 |
| 2003 |
| % Change |
| ||||
AVERAGE BALANCES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Total assets |
| $ | 31,040,639 |
| $ | 28,021,084 |
| 10.78 | % | $ | 30,431,786 |
| $ | 27,669,319 |
| 9.98 | % |
Securities |
| 5,224,576 |
| 4,360,357 |
| 19.82 | % | 5,156,227 |
| 4,137,334 |
| 24.63 | % | ||||
Net loans and leases |
| 20,969,643 |
| 19,207,484 |
| 9.17 | % | 20,543,659 |
| 19,086,852 |
| 7.63 | % | ||||
Goodwill |
| 650,160 |
| 730,067 |
| (10.95 | )% | 651,919 |
| 730,084 |
| (10.71 | )% | ||||
Core deposit and other intangibles |
| 67,031 |
| 79,314 |
| (15.49 | )% | 68,492 |
| 80,516 |
| (14.93 | )% | ||||
Total deposits |
| 21,640,762 |
| 19,874,701 |
| 8.89 | % | 21,262,342 |
| 19,896,599 |
| 6.86 | % | ||||
Core deposits (1) |
| 20,409,823 |
| 18,594,105 |
| 9.77 | % | 20,045,071 |
| 18,595,446 |
| 7.80 | % | ||||
Minority interest |
| 21,750 |
| 22,991 |
| (5.40 | )% | 21,781 |
| 22,986 |
| (5.24 | )% | ||||
Shareholders’ equity |
| 2,618,259 |
| 2,459,145 |
| 6.47 | % | 2,598,569 |
| 2,430,796 |
| 6.90 | % | ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Weighted average common and common-equivalent shares outstanding |
| 90,658,259 |
| 90,586,065 |
| 0.08 | % | 90,803,003 |
| 90,607,173 |
| 0.22 | % | ||||
|
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|
| ||||
AT PERIOD END |
|
|
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|
|
|
|
|
| ||||
Total assets |
|
|
|
|
|
|
| $ | 30,894,325 |
| $ | 27,805,628 |
| 11.11 | % | ||
Securities |
|
|
|
|
|
|
| 5,028,173 |
| 4,228,260 |
| 18.92 | % | ||||
Net loans and leases |
|
|
|
|
|
|
| 21,497,058 |
| 19,439,822 |
| 10.58 | % | ||||
Sold loans being serviced (2) |
|
|
|
|
|
|
| 2,643,927 |
| 2,367,751 |
| 11.66 | % | ||||
Allowance for loan losses |
|
|
|
|
|
|
| 271,554 |
| 281,486 |
| (3.53 | )% | ||||
Goodwill |
|
|
|
|
|
|
| 650,557 |
| 730,069 |
| (10.89 | )% | ||||
Core deposit and other intangibles |
|
|
|
|
|
|
| 62,221 |
| 75,817 |
| (17.93 | )% | ||||
Total deposits |
|
|
|
|
|
|
| 22,470,488 |
| 20,625,170 |
| 8.95 | % | ||||
Core deposits (1) |
|
|
|
|
|
|
| 21,198,263 |
| 19,322,067 |
| 9.71 | % | ||||
Minority interest |
|
|
|
|
|
|
| 21,721 |
| 22,995 |
| (5.54 | )% | ||||
Shareholders’ equity |
|
|
|
|
|
|
| 2,636,451 |
| 2,479,421 |
| 6.33 | % | ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Common shares outstanding |
|
|
|
|
|
|
| 89,752,384 |
| 89,724,846 |
| 0.03 | % | ||||
|
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|
|
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|
|
|
|
|
|
|
| ||||
Average equity to average assets |
| 8.43 | % | 8.78 | % |
|
| 8.54 | % | 8.79 | % |
|
| ||||
Common dividend payout |
| 29.12 | % | 20.47 | % |
|
| 28.69 | % | 21.07 | % |
|
| ||||
Tangible common equity ratio |
|
|
|
|
|
|
| 6.37 | % | 6.20 | % |
|
| ||||
Nonperforming assets |
|
|
|
|
|
|
| 106,750 |
| 119,371 |
| (10.57 | )% | ||||
Loans past due 90 days or more |
|
|
|
|
|
|
| 18,109 |
| 35,055 |
| (48.34 | )% | ||||
Nonperforming assets to net loans and leases and other real estate owned at period end |
|
|
|
|
|
|
| 0.50 | % | 0.61 | % |
|
| ||||
(1) Amount consists of total deposits excluding time deposits $100,000 and over.
(2) Amount represents the outstanding balance of loans sold and being serviced by the Company, excluding conforming first mortgage residential real estate loans.
8
ZIONS BANCORPORATION AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS (Continued)
(Unaudited)
|
| Three Months Ended |
| |||||||||||||
(In thousands, except per share and ratio data) |
| June 30, |
| March 31, |
| December 31, |
| September 30, |
| June 30, |
| |||||
|
| 2004 |
| 2003 |
| |||||||||||
EARNINGS |
|
|
|
|
|
|
|
|
|
|
| |||||
Taxable-equivalent net interest income |
| $ | 289,630 |
| $ | 287,614 |
| $ | 283,866 |
| $ | 282,776 |
| $ | 279,794 |
|
Net interest income |
| 284,245 |
| 282,183 |
| 278,254 |
| 277,079 |
| 273,953 |
| |||||
Noninterest income |
| 107,279 |
| 106,050 |
| 102,753 |
| 190,176 |
| 100,805 |
| |||||
Provision for loan losses |
| 10,301 |
| 11,244 |
| 15,980 |
| 18,260 |
| 18,150 |
| |||||
Noninterest expense |
| 229,976 |
| 222,338 |
| 217,967 |
| 245,506 |
| 216,403 |
| |||||
Impairment loss on goodwill |
| — |
| — |
| — |
| 75,628 |
| — |
| |||||
Income before income taxes and minority interest |
| 151,247 |
| 154,651 |
| 147,060 |
| 127,861 |
| 140,205 |
| |||||
Income taxes |
| 54,631 |
| 54,714 |
| 51,890 |
| 66,511 |
| 48,956 |
| |||||
Minority interest |
| (2,226 | ) | 268 |
| (440 | ) | (2,849 | ) | (1,159 | ) | |||||
Income from continuing operations |
| 98,842 |
| 99,669 |
| 95,610 |
| 64,199 |
| 92,408 |
| |||||
Income (loss) on discontinued operations |
| — |
| — |
| — |
| (2,115 | ) | 17 |
| |||||
Net income |
| 98,842 |
| 99,669 |
| 95,610 |
| 62,084 |
| 92,425 |
| |||||
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| |||||
PER COMMON SHARE |
|
|
|
|
|
|
|
|
|
|
| |||||
Net income (diluted) |
| 1.09 |
| 1.10 |
| 1.05 |
| 0.68 |
| 1.02 |
| |||||
Income from continuing operations (diluted) |
| 1.09 |
| 1.10 |
| 1.05 |
| 0.71 |
| 1.02 |
| |||||
Income (loss) on discontinued operations (diluted) |
| — |
| — |
| — |
| (0.03 | ) | — |
| |||||
Dividends |
| 0.32 |
| 0.30 |
| 0.30 |
| 0.30 |
| 0.21 |
| |||||
Book value |
| 29.37 |
| 29.23 |
| 28.27 |
| 27.66 |
| 27.63 |
| |||||
|
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| |||||
SELECTED RATIOS |
|
|
|
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|
|
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|
|
| |||||
Return on average assets |
| 1.28 | % | 1.34 | % | 1.32 | % | 0.86 | % | 1.32 | % | |||||
Return on average common equity |
| 15.18 | % | 15.54 | % | 15.05 | % | 9.89 | % | 15.07 | % | |||||
Efficiency ratio |
| 57.94 | % | 56.48 | % | 56.38 | % | 52.08 | % | 56.96 | % | |||||
Net interest margin |
| 4.20 | % | 4.32 | % | 4.39 | % | 4.39 | % | 4.50 | % | |||||
9
ZIONS BANCORPORATION AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS (Continued)
(Unaudited)
|
| Three Months Ended |
| |||||||||||||
(In thousands, except share and ratio data) |
| June 30, |
| March 31, |
| December 31, |
| September 30, |
| June 30, |
| |||||
|
| 2004 |
| 2003 |
| |||||||||||
AVERAGE BALANCES |
|
|
|
|
|
|
|
|
|
|
| |||||
Total assets |
| $ | 31,040,639 |
| $ | 29,822,933 |
| $ | 28,761,614 |
| $ | 28,696,504 |
| $ | 28,021,084 |
|
Securities |
| 5,224,576 |
| 5,087,878 |
| 4,858,930 |
| 4,644,337 |
| 4,360,357 |
| |||||
Net loans and leases |
| 20,969,643 |
| 20,117,675 |
| 19,539,294 |
| 19,577,780 |
| 19,207,484 |
| |||||
Goodwill |
| 650,160 |
| 653,678 |
| 654,151 |
| 729,149 |
| 730,067 |
| |||||
Core deposit and other intangibles |
| 67,031 |
| 69,953 |
| 72,499 |
| 76,457 |
| 79,314 |
| |||||
Total deposits |
| 21,640,762 |
| 20,883,922 |
| 20,782,912 |
| 20,425,204 |
| 19,874,701 |
| |||||
Core deposits (1) |
| 20,409,823 |
| 19,680,319 |
| 19,521,067 |
| 19,129,253 |
| 18,594,105 |
| |||||
Minority interest |
| 21,750 |
| 21,812 |
| 20,297 |
| 20,930 |
| 22,991 |
| |||||
Shareholders’ equity |
| 2,618,259 |
| 2,578,879 |
| 2,520,280 |
| 2,489,613 |
| 2,459,145 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Weighted average common and common-equivalent shares outstanding |
| 90,658,259 |
| 90,905,218 |
| 91,407,363 |
| 90,810,743 |
| 90,586,065 |
| |||||
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|
| |||||
AT PERIOD END |
|
|
|
|
|
|
|
|
|
|
| |||||
Total assets |
| $ | 30,894,325 |
| $ | 29,789,703 |
| $ | 28,558,238 |
| $ | 27,604,188 |
| $ | 27,805,628 |
|
Securities |
| 5,028,173 |
| 4,857,025 |
| 4,818,017 |
| 4,339,956 |
| 4,228,260 |
| |||||
Net loans and leases |
| 21,497,058 |
| 20,620,718 |
| 19,920,361 |
| 19,434,101 |
| 19,439,822 |
| |||||
Sold loans being serviced (2) |
| 2,643,927 |
| 2,707,128 |
| 2,782,175 |
| 2,894,638 |
| 2,367,751 |
| |||||
Allowance for loan losses |
| 271,554 |
| 271,226 |
| 268,506 |
| 281,311 |
| 281,486 |
| |||||
Goodwill |
| 650,557 |
| 649,354 |
| 654,152 |
| 654,161 |
| 730,069 |
| |||||
Core deposit and other intangibles |
| 62,221 |
| 65,245 |
| 68,747 |
| 72,265 |
| 75,817 |
| |||||
Total deposits |
| 22,470,488 |
| 21,485,880 |
| 20,896,695 |
| 20,874,124 |
| 20,625,170 |
| |||||
Core deposits (1) |
| 21,198,263 |
| 20,283,721 |
| 19,669,582 |
| 19,546,495 |
| 19,322,067 |
| |||||
Minority interest |
| 21,721 |
| 23,847 |
| 19,776 |
| 20,216 |
| 22,995 |
| |||||
Shareholders’ equity |
| 2,636,451 |
| 2,621,965 |
| 2,540,023 |
| 2,485,971 |
| 2,479,421 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Common shares outstanding |
| 89,752,384 |
| 89,693,704 |
| 89,840,638 |
| 89,864,022 |
| 89,724,846 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Average equity to average assets |
| 8.43 | % | 8.65 | % | 8.76 | % | 8.68 | % | 8.78 | % | |||||
Common dividend payout |
| 29.12 | % | 28.26 | % | 28.24 | % | 43.39 | % | 20.47 | % | |||||
Tangible common equity ratio |
| 6.37 | % | 6.56 | % | 6.53 | % | 6.55 | % | 6.20 | % | |||||
Nonperforming assets |
| 106,750 |
| 109,487 |
| 97,964 |
| 109,566 |
| 119,371 |
| |||||
Loans past due 90 days or more |
| 18,109 |
| 26,307 |
| 24,231 |
| 36,752 |
| 35,055 |
| |||||
Nonperforming assets to net loans and leases and other real estate owned at period end |
| 0.50 | % | 0.53 | % | 0.49 | % | 0.56 | % | 0.61 | % | |||||
(1) Amount consists of total deposits excluding time deposits $100,000 and over.
(2) Amount represents the outstanding balance of loans sold and being serviced by the Company, excluding conforming first mortgage residential real estate loans.
10
ZIONS BANCORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands, except share amounts) |
| June 30, |
| March 31, |
| December 31, |
| June 30, |
| ||||
|
| (Unaudited) |
| (Unaudited) |
|
|
| (Unaudited) |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
ASSETS |
|
|
|
|
|
|
|
|
| ||||
Cash and due from banks |
| $ | 1,124,832 |
| $ | 1,058,735 |
| $ | 1,119,351 |
| $ | 1,225,316 |
|
Money market investments: |
|
|
|
|
|
|
|
|
| ||||
Interest-bearing deposits |
| 3,767 |
| 1,388 |
| 884 |
| 2,369 |
| ||||
Federal funds sold |
| 57,115 |
| 62,817 |
| 54,850 |
| 61,482 |
| ||||
Security resell agreements |
| 770,139 |
| 770,109 |
| 512,960 |
| 512,532 |
| ||||
Investment securities: |
|
|
|
|
|
|
|
|
| ||||
Held to maturity, at cost (approximate market value $634,127, $607,119, $0 and $0) |
| 642,504 |
| 605,292 |
| — |
| — |
| ||||
Available for sale, at market |
| 3,784,086 |
| 3,867,883 |
| 4,437,793 |
| 3,843,532 |
| ||||
Trading account, at market (includes $369,883, $160,122, $211,943 and $234,162 transferred as collateral under repurchase agreements) |
| 601,583 |
| 383,850 |
| 380,224 |
| 384,728 |
| ||||
|
| 5,028,173 |
| 4,857,025 |
| 4,818,017 |
| 4,228,260 |
| ||||
Loans: |
|
|
|
|
|
|
|
|
| ||||
Loans held for sale |
| 140,982 |
| 185,126 |
| 176,886 |
| 236,298 |
| ||||
Loans, leases and other receivables |
| 21,457,499 |
| 20,528,993 |
| 19,839,755 |
| 19,297,984 |
| ||||
|
| 21,598,481 |
| 20,714,119 |
| 20,016,641 |
| 19,534,282 |
| ||||
Less: |
|
|
|
|
|
|
|
|
| ||||
Unearned income and fees, net of related costs |
| 101,423 |
| 93,401 |
| 96,280 |
| 94,460 |
| ||||
Allowance for loan losses |
| 271,554 |
| 271,226 |
| 268,506 |
| 281,486 |
| ||||
Net loans |
| 21,225,504 |
| 20,349,492 |
| 19,651,855 |
| 19,158,336 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Other noninterest bearing investments |
| 640,471 |
| 605,642 |
| 584,377 |
| 599,710 |
| ||||
Premises and equipment, net |
| 402,203 |
| 404,247 |
| 407,825 |
| 406,952 |
| ||||
Goodwill |
| 650,557 |
| 649,354 |
| 654,152 |
| 730,069 |
| ||||
Core deposit and other intangibles |
| 62,221 |
| 65,245 |
| 68,747 |
| 75,817 |
| ||||
Other real estate owned |
| 13,590 |
| 17,217 |
| 18,596 |
| 18,005 |
| ||||
Other assets |
| 915,753 |
| 948,432 |
| 666,624 |
| 786,780 |
| ||||
|
| $ | 30,894,325 |
| $ | 29,789,703 |
| $ | 28,558,238 |
| $ | 27,805,628 |
|
LIABILITIES AND SHAREHOLDERS’ EQUITY |
|
|
|
|
|
|
|
|
| ||||
Deposits: |
|
|
|
|
|
|
|
|
| ||||
Noninterest-bearing demand |
| $ | 6,585,035 |
| $ | 6,117,345 |
| $ | 5,882,929 |
| $ | 5,715,616 |
|
Interest-bearing: |
|
|
|
|
|
|
|
|
| ||||
Savings and money market |
| 12,838,974 |
| 12,443,178 |
| 12,044,499 |
| 11,810,192 |
| ||||
Time under $100,000 |
| 1,419,984 |
| 1,453,064 |
| 1,507,628 |
| 1,629,569 |
| ||||
Time $100,000 and over |
| 1,272,225 |
| 1,202,159 |
| 1,227,113 |
| 1,303,103 |
| ||||
Foreign |
| 354,270 |
| 270,134 |
| 234,526 |
| 166,690 |
| ||||
|
| 22,470,488 |
| 21,485,880 |
| 20,896,695 |
| 20,625,170 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Securities sold, not yet purchased |
| 517,176 |
| 355,978 |
| 263,379 |
| 280,650 |
| ||||
Federal funds purchased |
| 1,056,695 |
| 1,324,972 |
| 1,370,619 |
| 1,052,591 |
| ||||
Security repurchase agreements |
| 1,024,427 |
| 930,425 |
| 841,170 |
| 874,949 |
| ||||
Other liabilities |
| 607,676 |
| 701,321 |
| 442,020 |
| 539,360 |
| ||||
Commercial paper |
| 188,612 |
| 190,525 |
| 126,144 |
| 290,907 |
| ||||
Federal Home Loan Bank advances and other borrowings: |
|
|
|
|
|
|
|
|
| ||||
One year or less |
| 416,630 |
| 315,976 |
| 215,354 |
| 267,768 |
| ||||
Over one year |
| 230,128 |
| 230,772 |
| 231,440 |
| 235,768 |
| ||||
Long-term debt |
| 1,724,321 |
| 1,608,042 |
| 1,611,618 |
| 1,136,049 |
| ||||
Total liabilities |
| 28,236,153 |
| 27,143,891 |
| 25,998,439 |
| 25,303,212 |
| ||||
Minority interest |
| 21,721 |
| 23,847 |
| 19,776 |
| 22,995 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Shareholders’ equity: |
|
|
|
|
|
|
|
|
| ||||
Capital stock: |
|
|
|
|
|
|
|
|
| ||||
Preferred stock, without par value; authorized 3,000,000 shares; issued and outstanding, none |
| — |
| — |
| — |
| — |
| ||||
Common stock, without par value; authorized 350,000,000 shares; issued and outstanding 89,752,384, 89,693,704, 89,840,638 and 89,724,846 shares |
| 974,479 |
| 973,506 |
| 985,904 |
| 987,021 |
| ||||
Retained earnings |
| 1,680,240 |
| 1,610,176 |
| 1,538,677 |
| 1,434,915 |
| ||||
Accumulated other comprehensive income (loss) |
| (14,238 | ) | 42,226 |
| 19,041 |
| 60,416 |
| ||||
Shares held in trust for deferred compensation, at cost |
| (4,030 | ) | (3,943 | ) | (3,599 | ) | (2,931 | ) | ||||
Total shareholders’ equity |
| 2,636,451 |
| 2,621,965 |
| 2,540,023 |
| 2,479,421 |
| ||||
|
| $ | 30,894,325 |
| $ | 29,789,703 |
| $ | 28,558,238 |
| $ | 27,805,628 |
|
11
ZIONS BANCORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
|
| Three Months Ended |
| Six Months Ended |
| |||||||||||
(In thousands, except per share amounts) |
| June 30, |
| March 31, |
| June 30, |
| June 30, |
| June 30, |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Interest income: |
|
|
|
|
|
|
|
|
|
|
| |||||
Interest and fees on loans |
| $ | 299,678 |
| $ | 291,137 |
| $ | 297,866 |
| $ | 590,815 |
| $ | 595,215 |
|
Interest on loans held for sale |
| 1,383 |
| 1,280 |
| 2,225 |
| 2,663 |
| 4,730 |
| |||||
Lease financing |
| 4,230 |
| 4,209 |
| 4,479 |
| 8,439 |
| 9,013 |
| |||||
Interest on money market investments |
| 3,077 |
| 3,458 |
| 3,611 |
| 6,535 |
| 7,548 |
| |||||
Interest on securities: |
|
|
|
|
|
|
|
|
|
|
| |||||
Held to maturity – taxable |
| 1,731 |
| 228 |
| — |
| 1,959 |
| — |
| |||||
Held to maturity – nontaxable |
| 5,872 |
| 898 |
| — |
| 6,770 |
| — |
| |||||
Available for sale – taxable |
| 37,169 |
| 37,869 |
| 31,703 |
| 75,038 |
| 59,923 |
| |||||
Available for sale – nontaxable |
| 1,208 |
| 6,092 |
| 7,459 |
| 7,300 |
| 14,752 |
| |||||
Trading account |
| 8,131 |
| 6,212 |
| 6,194 |
| 14,343 |
| 11,755 |
| |||||
Total interest income |
| 362,479 |
| 351,383 |
| 353,537 |
| 713,862 |
| 702,936 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Interest expense: |
|
|
|
|
|
|
|
|
|
|
| |||||
Interest on savings and money market deposits |
| 27,470 |
| 25,470 |
| 28,531 |
| 52,940 |
| 61,160 |
| |||||
Interest on time and foreign deposits |
| 14,091 |
| 14,042 |
| 18,746 |
| 28,133 |
| 39,734 |
| |||||
Interest on borrowed funds |
| 36,673 |
| 29,688 |
| 32,307 |
| 66,361 |
| 61,881 |
| |||||
Total interest expense |
| 78,234 |
| 69,200 |
| 79,584 |
| 147,434 |
| 162,775 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Net interest income |
| 284,245 |
| 282,183 |
| 273,953 |
| 566,428 |
| 540,161 |
| |||||
Provision for loan losses |
| 10,301 |
| 11,244 |
| 18,150 |
| 21,545 |
| 35,700 |
| |||||
Net interest income after provision for loan losses |
| 273,944 |
| 270,939 |
| 255,803 |
| 544,883 |
| 504,461 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Noninterest income: |
|
|
|
|
|
|
|
|
|
|
| |||||
Service charges and fees on deposit accounts |
| 33,419 |
| 32,755 |
| 32,107 |
| 66,174 |
| 63,519 |
| |||||
Loan sales and servicing income |
| 20,459 |
| 18,412 |
| 22,731 |
| 38,871 |
| 42,162 |
| |||||
Other service charges, commissions and fees |
| 23,070 |
| 22,359 |
| 20,847 |
| 45,429 |
| 41,638 |
| |||||
Trust and investment management income |
| 4,797 |
| 4,075 |
| 5,331 |
| 8,872 |
| 10,459 |
| |||||
Income from securities conduit |
| 8,880 |
| 8,698 |
| 7,065 |
| 17,578 |
| 13,931 |
| |||||
Dividends and other investment income |
| 8,545 |
| 8,095 |
| 7,831 |
| 16,640 |
| 13,828 |
| |||||
Market making, trading and nonhedge derivative income |
| 6,072 |
| 6,124 |
| 7,821 |
| 12,196 |
| 17,693 |
| |||||
Equity securities losses, net |
| (5,302 | ) | (4,031 | ) | (6,460 | ) | (9,333 | ) | (12,364 | ) | |||||
Fixed income securities gains (losses), net |
| 2,220 |
| (83 | ) | 219 |
| 2,137 |
| 354 |
| |||||
Other |
| 5,119 |
| 9,646 |
| 3,313 |
| 14,765 |
| 5,946 |
| |||||
Total noninterest income |
| 107,279 |
| 106,050 |
| 100,805 |
| 213,329 |
| 197,166 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Noninterest expense: |
|
|
|
|
|
|
|
|
|
|
| |||||
Salaries and employee benefits |
| 129,354 |
| 130,278 |
| 122,702 |
| 259,632 |
| 246,288 |
| |||||
Occupancy, net |
| 18,658 |
| 17,813 |
| 16,664 |
| 36,471 |
| 33,511 |
| |||||
Furniture and equipment |
| 16,768 |
| 15,948 |
| 15,901 |
| 32,716 |
| 31,684 |
| |||||
Legal and professional services |
| 9,893 |
| 7,214 |
| 6,111 |
| 17,107 |
| 11,033 |
| |||||
Postage and supplies |
| 6,309 |
| 6,648 |
| 6,646 |
| 12,957 |
| 13,311 |
| |||||
Advertising |
| 5,186 |
| 4,842 |
| 4,941 |
| 10,028 |
| 8,921 |
| |||||
Impairment losses on long-lived assets |
| 528 |
| 184 |
| 892 |
| 712 |
| 914 |
| |||||
Restructuring charges |
| — |
| — |
| 1,106 |
| — |
| 1,106 |
| |||||
Amortization of core deposit and other intangibles |
| 3,501 |
| 3,503 |
| 3,552 |
| 7,004 |
| 7,103 |
| |||||
Provision for unfunded lending commitments |
| 622 |
| (1,739 | ) | — |
| (1,117 | ) | — |
| |||||
Other |
| 39,157 |
| 37,647 |
| 37,888 |
| 76,804 |
| 76,518 |
| |||||
Total noninterest expense |
| 229,976 |
| 222,338 |
| 216,403 |
| 452,314 |
| 430,389 |
| |||||
Income from continuing operations before income taxes and minority interest |
| 151,247 |
| 154,651 |
| 140,205 |
| 305,898 |
| 271,238 |
| |||||
Income taxes |
| 54,631 |
| 54,714 |
| 48,956 |
| 109,345 |
| 95,350 |
| |||||
Minority interest |
| (2,226 | ) | 268 |
| (1,159 | ) | (1,958 | ) | (3,896 | ) | |||||
Income from continuing operations |
| 98,842 |
| 99,669 |
| 92,408 |
| 198,511 |
| 179,784 |
| |||||
12
ZIONS BANCORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (Continued)
(Unaudited)
|
| Three Months Ended |
| Six Months Ended |
| |||||||||||
(In thousands, except per share amounts) |
| June 30, |
| March 31, |
| June 30, |
| June 30, |
| June 30, |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Discontinued operations: |
|
|
|
|
|
|
|
|
|
|
| |||||
Income from operations of discontinued subsidiaries |
| $ | — |
| $ | — |
| $ | 33 |
| $ | — |
| $ | 585 |
|
Income taxes |
| — |
| — |
| 16 |
| — |
| 240 |
| |||||
Income on discontinued operations |
| — |
| — |
| 17 |
| — |
| 345 |
| |||||
Net income |
| $ | 98,842 |
| $ | 99,669 |
| $ | 92,425 |
| $ | 198,511 |
| $ | 180,129 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Weighted average shares outstanding during the period: |
|
|
|
|
|
|
|
|
|
|
| |||||
Basic shares |
| 89,589 |
| 89,724 |
| 90,008 |
| 89,657 |
| 90,267 |
| |||||
Diluted shares |
| 90,658 |
| 90,905 |
| 90,586 |
| 90,803 |
| 90,607 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Net income per common share: |
|
|
|
|
|
|
|
|
|
|
| |||||
Basic: |
|
|
|
|
|
|
|
|
|
|
| |||||
Income from continuing operations |
| $ | 1.10 |
| $ | 1.11 |
| $ | 1.03 |
| $ | 2.21 |
| $ | 1.99 |
|
Income on discontinued operations |
| — |
| — |
| — |
| — |
| 0.01 |
| |||||
Net income |
| $ | 1.10 |
| $ | 1.11 |
| $ | 1.03 |
| $ | 2.21 |
| $ | 2.00 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Diluted: |
|
|
|
|
|
|
|
|
|
|
| |||||
Income from continuing operations |
| $ | 1.09 |
| $ | 1.10 |
| $ | 1.02 |
| $ | 2.19 |
| $ | 1.98 |
|
Income on discontinued operations |
| — |
| — |
| — |
| — |
| 0.01 |
| |||||
Net income |
| $ | 1.09 |
| $ | 1.10 |
| $ | 1.02 |
| $ | 2.19 |
| $ | 1.99 |
|
13
ZIONS BANCORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY AND COMPREHENSIVE INCOME
(Unaudited)
|
| Six Months Ended June 30, 2004 |
| ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
| Accumulated Other Comprehensive Income (Loss) |
|
|
|
|
| ||||||||||||||||||||||||||||
(In thousands) |
| Common |
| Retained |
| Net Unrealized |
| Net |
| Minimum |
| Subtotal |
| Shares |
| Total |
| ||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||
Balance, December 31, 2003 |
| $ | 985,904 |
| $ | 1,538,677 |
| $ | 24,015 |
| $ | 10,716 |
| $ | (15,690 | ) | $ | 19,041 |
| $ | (3,599 | ) | $ | 2,540,023 |
| ||||||||||||||
Comprehensive income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||
Net income for the period |
|
|
| 198,511 |
|
|
|
|
|
|
|
|
|
|
| 198,511 |
| ||||||||||||||||||||||
Other comprehensive income, net of tax: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||
Net realized and unrealized holding losses during the period, net of income tax benefit of $4,739 |
|
|
|
|
| (7,610 | ) |
|
|
|
| (7,610 | ) |
|
|
|
| ||||||||||||||||||||||
Reclassification for net realized gains recorded in operations, net of income tax expense of $723 |
|
|
|
|
| (1,167 | ) |
|
|
|
| (1,167 | ) |
|
|
|
| ||||||||||||||||||||||
Net unrealized losses on derivative instruments, net of reclassification to operations of $24,505 and income tax benefit of $15,447 |
|
|
|
|
|
|
| (24,502 | ) |
|
| (24,502 | ) |
|
|
|
| ||||||||||||||||||||||
Other comprehensive loss |
|
|
|
|
| (8,777 | ) | (24,502 | ) | — |
| (33,279 | ) |
|
| (33,279 | ) | ||||||||||||||||||||||
Total comprehensive income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 165,232 |
| ||||||||||||||||||||||
Stock redeemed and retired |
| (54,881 | ) |
|
|
|
|
|
|
|
|
|
|
|
| (54,881 | ) | ||||||||||||||||||||||
Stock options exercised, net of shares tendered and retired |
| 43,456 |
|
|
|
|
|
|
|
|
|
|
|
|
| 43,456 |
| ||||||||||||||||||||||
Cash dividends – common, $.62 per share |
|
|
| (56,948 | ) |
|
|
|
|
|
|
|
|
|
| (56,948 | ) | ||||||||||||||||||||||
Cost of shares held in trust for deferred compensation |
|
|
|
|
|
|
|
|
|
|
|
|
| (431 | ) | (431 | ) | ||||||||||||||||||||||
Balance, June 30, 2004 |
| $ | 974,479 |
| $ | 1,680,240 |
| $ | 15,238 |
| $ | (13,786 | ) | $ | (15,690 | ) | $ | (14,238 | ) | $ | (4,030 | ) | $ | 2,636,451 |
| ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||
|
| Six Months Ended June 30, 2003 |
| ||||||||||||||||||||||||||||||||||||
|
|
|
|
|
| Accumulated Other Comprehensive Income (Loss) |
|
|
|
|
|
| |||||||||||||||||||||||||||
(In thousands) |
| Common |
| Retained |
| Net Unrealized |
| Net |
| Minimum |
| Subtotal |
| Shares |
| Total |
|
| |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||
Balance, December 31, 2002 |
| $ | 1,034,888 |
| $ | 1,292,741 |
| $ | 44,151 |
| $ | 25,420 |
| $ | (23,357 | ) | $ | 46,214 |
| $ | — |
| $ | 2,373,843 |
| ||||||||||||||
Comprehensive income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||
Net income for the period |
|
|
| 180,129 |
|
|
|
|
|
|
|
|
|
|
| 180,129 |
| ||||||||||||||||||||||
Other comprehensive income, net of tax: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||||||
Net realized and unrealized holding gains during the period, net of income tax expense of $7,053 |
|
|
|
|
| 11,386 |
|
|
|
|
| 11,386 |
|
|
|
|
| ||||||||||||||||||||||
Reclassification for net realized gains recorded in operations, net of income tax expense of $2,960 |
|
|
|
|
| (4,779 | ) |
|
|
|
| (4,779 | ) |
|
|
|
| ||||||||||||||||||||||
Net unrealized gains on derivative instruments, net of reclassification to operations of $19,227 and income tax expense of $4,648 |
|
|
|
|
|
|
| 7,595 |
|
|
| 7,595 |
|
|
|
|
| ||||||||||||||||||||||
Other comprehensive income |
|
|
|
|
| 6,607 |
| 7,595 |
| — |
| 14,202 |
|
|
| 14,202 |
| ||||||||||||||||||||||
Total comprehensive income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 194,331 |
| ||||||||||||||||||||||
Stock redeemed and retired |
| (56,458 | ) |
|
|
|
|
|
|
|
|
|
|
|
| (56,458 | ) | ||||||||||||||||||||||
Stock options exercised, net of shares tendered and retired |
| 8,591 |
|
|
|
|
|
|
|
|
|
|
|
|
| 8,591 |
| ||||||||||||||||||||||
Cash dividends – common, $.42 per share |
|
|
| (37,955 | ) |
|
|
|
|
|
|
|
|
|
| (37,955 | ) | ||||||||||||||||||||||
Cost of shares held in trust for deferred compensation |
|
|
|
|
|
|
|
|
|
|
|
|
| (2,931 | ) | (2,931 | ) | ||||||||||||||||||||||
Balance, June 30, 2003 |
| $ | 987,021 |
| $ | 1,434,915 |
| $ | 50,758 |
| $ | 33,015 |
| $ | (23,357 | ) | $ | 60,416 |
| $ | (2,931 | ) | $ | 2,479,421 |
| ||||||||||||||
Total comprehensive income for the three months ended June 30, 2004 and 2003 was $42,378 and $114,283, respectively.
14
ZIONS BANCORPORATION AND SUBSIDIARIES
Sold Loans Being Serviced
(Unaudited)
|
| Three Months Ended |
| |||||||||||||
(In thousands) |
| June 30, |
| March 31, |
| December 31, |
| September 30, |
| June 30, |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Balance at beginning of period |
| $ | 2,707,128 |
| $ | 2,782,175 |
| $ | 2,894,638 |
| $ | 2,367,751 |
| $ | 2,401,930 |
|
New loans sold |
| 118,018 |
| 90,770 |
| 107,373 |
| 715,534 |
| 142,666 |
| |||||
Payments and other reductions |
| (181,219 | ) | (165,817 | ) | (219,836 | ) | (188,647 | ) | (176,845 | ) | |||||
Balance at end of period |
| $ | 2,643,927 |
| $ | 2,707,128 |
| $ | 2,782,175 |
| $ | 2,894,638 |
| $ | 2,367,751 |
|
Nonperforming Assets
(Unaudited)
(In thousands) |
| June 30, |
| March 31, |
| December 31, |
| September 30, |
| June 30, |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Nonaccrual loans |
| $ | 92,597 |
| $ | 91,698 |
| $ | 78,170 |
| $ | 80,110 |
| $ | 98,843 |
|
Restructured loans |
| 563 |
| 572 |
| 1,198 |
| 2,032 |
| 2,523 |
| |||||
Other real estate owned |
| 13,590 |
| 17,217 |
| 18,596 |
| 27,424 |
| 18,005 |
| |||||
Total |
| $ | 106,750 |
| $ | 109,487 |
| $ | 97,964 |
| $ | 109,566 |
| $ | 119,371 |
|
% of net loans and leases* and other real estate owned |
| 0.50 | % | 0.53 | % | 0.49 | % | 0.56 | % | 0.61 | % | |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Accruing loans past due 90 days or more |
| $ | 18,109 |
| $ | 26,307 |
| $ | 24,231 |
| $ | 36,752 |
| $ | 35,055 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
% of net loans and leases* |
| 0.08 | % | 0.13 | % | 0.12 | % | 0.19 | % | 0.18 | % | |||||
*Includes loans held for sale.
Allowance for Loan Losses
(Unaudited)
|
| Three Months Ended |
| |||||||||||||
(In thousands) |
| June 30, |
| March 31, |
| December 31, |
| September 30, |
| June 30, |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Balance at beginning of period |
| $ | 271,226 |
| $ | 268,506 |
| $ | 281,311 |
| $ | 281,486 |
| $ | 280,533 |
|
Allowance of branches sold |
| — |
| (518 | ) | — |
| — |
| — |
| |||||
Add: |
|
|
|
|
|
|
|
|
|
|
| |||||
Provision for losses |
| 10,301 |
| 11,244 |
| 15,980 |
| 18,260 |
| 18,150 |
| |||||
Deduct: |
|
|
|
|
|
|
|
|
|
|
| |||||
Loan and lease charge-offs |
| (14,530 | ) | (11,483 | ) | (22,436 | ) | (22,286 | ) | (21,242 | ) | |||||
Recoveries |
| 4,557 |
| 3,477 |
| 5,866 |
| 3,851 |
| 4,045 |
| |||||
Net loan and lease charge-offs |
| (9,973 | ) | (8,006 | ) | (16,570 | ) | (18,435 | ) | (17,197 | ) | |||||
Reclassification of allowance for unfunded lending commitments |
| — |
| — |
| (12,215 | ) | — |
| — |
| |||||
Balance at end of period |
| $ | 271,554 |
| $ | 271,226 |
| $ | 268,506 |
| $ | 281,311 |
| $ | 281,486 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Ratio of allowance for loan losses to net loans and leases outstanding at period end |
| 1.26 | % | 1.32 | % | 1.35 | % | 1.45 | % | 1.45 | % | |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Ratio of allowance for loan losses to nonperforming loans at period end |
| 291.49 | % | 293.95 | % | 338.31 | % | 342.47 | % | 277.69 | % | |||||
Allowance for Unfunded Lending Commitments
(Unaudited)
|
| Three Months Ended |
|
|
|
|
| |||||||
(In thousands) |
| June 30, |
| March 31, |
| December 31, |
|
|
|
|
| |||
|
|
|
|
|
|
|
|
|
|
|
| |||
Balance at beginning of period |
| $ | 10,476 |
| $ | 12,215 |
| $ | — |
|
|
|
|
|
Reclassification of allowance for loan losses |
| — |
| — |
| 12,215 |
|
|
|
|
| |||
Provision charged (credited) against earnings |
| 622 |
| (1,739 | ) | — |
|
|
|
|
| |||
Balance at end of period |
| $ | 11,098 |
| $ | 10,476 |
| $ | 12,215 |
|
|
|
|
|
15
ZIONS BANCORPORATION AND SUBSIDIARIES
LOAN BALANCES BY PORTFOLIO TYPE
(Unaudited)
(In millions) |
| June 30, |
| March 31, |
| December 31, |
| September 30, |
| June 30, |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Loans held for sale |
| $ | 141 |
| $ | 185 |
| $ | 177 |
| $ | 216 |
| $ | 236 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Commercial lending: |
|
|
|
|
|
|
|
|
|
|
| |||||
Commercial and industrial |
| 4,381 |
| 4,204 |
| 4,111 |
| 4,102 |
| 4,071 |
| |||||
Leasing |
| 381 |
| 363 |
| 377 |
| 378 |
| 391 |
| |||||
Owner occupied |
| 3,666 |
| 3,465 |
| 3,295 |
| 3,062 |
| 3,353 |
| |||||
Total commercial lending |
| 8,428 |
| 8,032 |
| 7,783 |
| 7,542 |
| 7,815 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Commercial real estate: |
|
|
|
|
|
|
|
|
|
|
| |||||
Construction |
| 3,062 |
| 2,916 |
| 2,867 |
| 2,907 |
| 2,983 |
| |||||
Term |
| 3,921 |
| 3,646 |
| 3,426 |
| 3,316 |
| 3,326 |
| |||||
Total commercial real estate |
| 6,983 |
| 6,562 |
| 6,293 |
| 6,223 |
| 6,309 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Consumer: |
|
|
|
|
|
|
|
|
|
|
| |||||
Home equity credit line |
| 965 |
| 892 |
| 838 |
| 780 |
| 762 |
| |||||
1-4 family residential |
| 4,170 |
| 4,057 |
| 3,874 |
| 3,675 |
| 3,275 |
| |||||
Bankcard and other revolving plans |
| 183 |
| 183 |
| 198 |
| 188 |
| 186 |
| |||||
Other |
| 647 |
| 697 |
| 749 |
| 797 |
| 867 |
| |||||
Total consumer |
| 5,965 |
| 5,829 |
| 5,659 |
| 5,440 |
| 5,090 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Foreign loans |
| 6 |
| 15 |
| 15 |
| 15 |
| 17 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Other receivables |
| 75 |
| 91 |
| 90 |
| 93 |
| 67 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Total loans |
| $ | 21,598 |
| $ | 20,714 |
| $ | 20,017 |
| $ | 19,529 |
| $ | 19,534 |
|
16
ZIONS BANCORPORATION AND SUBSIDIARIES
CONSOLIDATED AVERAGE BALANCE SHEETS, YIELDS AND RATES
(Unaudited)
(In thousands) |
| Three Months Ended |
| Three Months Ended |
| ||||||||||||
|
| Average |
| Amount of |
| Average |
| Average |
| Amount of |
| Average |
| ||||
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Money market investments |
| $ | 1,544,884 |
| $ | 3,077 |
| 0.80% |
| $ | 1,346,595 |
| $ | 3,611 |
| 1.08% |
|
Securities: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Held to maturity |
| 622,519 |
| 10,764 |
| 6.95% |
| — |
| — |
|
|
| ||||
Available for sale |
| 3,827,182 |
| 39,028 |
| 4.10% |
| 3,664,436 |
| 43,178 |
| 4.73% |
| ||||
Trading account |
| 774,875 |
| 8,131 |
| 4.22% |
| 695,921 |
| 6,194 |
| 3.57% |
| ||||
Total securities |
| 5,224,576 |
| 57,923 |
| 4.46% |
| 4,360,357 |
| 49,372 |
| 4.54% |
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Loans: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Loans held for sale |
| 174,680 |
| 1,383 |
| 3.18% |
| 216,987 |
| 2,225 |
| 4.11% |
| ||||
Net loans and leases (2) |
| 20,794,963 |
| 305,481 |
| 5.91% |
| 18,990,497 |
| 304,170 |
| 6.42% |
| ||||
Total loans and leases |
| 20,969,643 |
| 306,864 |
| 5.89% |
| 19,207,484 |
| 306,395 |
| 6.40% |
| ||||
Total interest-earning assets |
| 27,739,103 |
| 367,864 |
| 5.33% |
| 24,914,436 |
| 359,378 |
| 5.79% |
| ||||
Cash and due from banks |
| 991,117 |
|
|
|
|
| 944,223 |
|
|
|
|
| ||||
Allowance for loan losses |
| (271,633 | ) |
|
|
|
| (281,511 | ) |
|
|
|
| ||||
Goodwill |
| 650,160 |
|
|
|
|
| 730,067 |
|
|
|
|
| ||||
Core deposit and other intangibles |
| 67,031 |
|
|
|
|
| 79,314 |
|
|
|
|
| ||||
Other assets |
| 1,864,861 |
|
|
|
|
| 1,634,555 |
|
|
|
|
| ||||
Total assets |
| $ | 31,040,639 |
|
|
|
|
| $ | 28,021,084 |
|
|
|
|
| ||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
LIABILITIES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Interest-bearing deposits: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Savings and NOW |
| $ | 3,367,286 |
| 5,083 |
| 0.61% |
| $ | 2,933,031 |
| 4,834 |
| 0.66% |
| ||
Money market super NOW |
| 9,185,946 |
| 22,387 |
| 0.98% |
| 8,744,693 |
| 23,697 |
| 1.09% |
| ||||
Time under $100,000 |
| 1,448,504 |
| 6,539 |
| 1.82% |
| 1,687,633 |
| 9,757 |
| 2.32% |
| ||||
Time $100,000 and over |
| 1,230,939 |
| 6,830 |
| 2.23% |
| 1,280,596 |
| 8,697 |
| 2.72% |
| ||||
Foreign |
| 284,825 |
| 722 |
| 1.02% |
| 126,987 |
| 292 |
| 0.92% |
| ||||
Total interest-bearing deposits |
| 15,517,500 |
| 41,561 |
| 1.08% |
| 14,772,940 |
| 47,277 |
| 1.28% |
| ||||
Borrowed funds: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Securities sold, not yet purchased |
| 691,076 |
| 6,536 |
| 3.80% |
| 554,579 |
| 5,104 |
| 3.69% |
| ||||
Federal funds purchased and security repurchase agreements |
| 2,988,215 |
| 7,034 |
| 0.95% |
| 2,733,363 |
| 7,411 |
| 1.09% |
| ||||
Commercial paper |
| 189,554 |
| 578 |
| 1.23% |
| 286,888 |
| 1,029 |
| 1.44% |
| ||||
FHLB advances and other borrowings: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
One year or less |
| 418,733 |
| 1,143 |
| 1.10% |
| 282,051 |
| 962 |
| 1.37% |
| ||||
Over one year |
| 230,424 |
| 2,910 |
| 5.08% |
| 238,447 |
| 3,104 |
| 5.22% |
| ||||
Long-term debt |
| 1,650,512 |
| 18,472 |
| 4.50% |
| 1,176,952 |
| 14,697 |
| 5.01% |
| ||||
Total borrowed funds |
| 6,168,514 |
| 36,673 |
| 2.39% |
| 5,272,280 |
| 32,307 |
| 2.46% |
| ||||
Total interest-bearing liabilities |
| 21,686,014 |
| 78,234 |
| 1.45% |
| 20,045,220 |
| 79,584 |
| 1.59% |
| ||||
Noninterest-bearing deposits |
| 6,123,262 |
|
|
|
|
| 5,101,761 |
|
|
|
|
| ||||
Other liabilities |
| 591,354 |
|
|
|
|
| 391,967 |
|
|
|
|
| ||||
Total liabilities |
| 28,400,630 |
|
|
|
|
| 25,538,948 |
|
|
|
|
| ||||
Minority interest |
| 21,750 |
|
|
|
|
| 22,991 |
|
|
|
|
| ||||
Total shareholders’ equity |
| 2,618,259 |
|
|
|
|
| 2,459,145 |
|
|
|
|
| ||||
Total liabilities and shareholders’ equity |
| $ | 31,040,639 |
|
|
|
|
| $ | 28,021,084 |
|
|
|
|
| ||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Spread on average interest-bearing funds |
|
|
|
|
| 3.88% |
|
|
|
|
| 4.20% |
| ||||
Taxable-equivalent net interest income and net yield on interest-earning assets |
|
|
| $ | 289,630 |
| 4.20% |
|
|
| $ | 279,794 |
| 4.50% |
| ||
(1) Taxable-equivalent rates used where applicable.
(2) Net of unearned income and fees, net of related costs. Loans include nonaccrual and restructured loans.
17
ZIONS BANCORPORATION AND SUBSIDIARIES
CONSOLIDATED AVERAGE BALANCE SHEETS, YIELDS AND RATES
(Unaudited)
(In thousands) |
| Six Months Ended |
| Six Months Ended |
| ||||||||||||
|
| Average |
| Amount of |
| Average |
| Average |
| Amount of |
| Average |
| ||||
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Money market investments |
| $ | 1,561,982 |
| $ | 6,535 |
| 0.84% |
| $ | 1,374,631 |
| $ | 7,548 |
| 1.11% |
|
Securities: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Held to maturity |
| 359,726 |
| 12,374 |
| 6.92% |
| — |
| — |
|
|
| ||||
Available for sale |
| 4,058,380 |
| 86,269 |
| 4.27% |
| 3,463,280 |
| 82,618 |
| 4.81% |
| ||||
Trading account |
| 738,121 |
| 14,343 |
| 3.91% |
| 674,054 |
| 11,755 |
| 3.52% |
| ||||
Total securities |
| 5,156,227 |
| 112,986 |
| 4.41% |
| 4,137,334 |
| 94,373 |
| 4.60% |
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Loans: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Loans held for sale |
| 174,362 |
| 2,663 |
| 3.07% |
| 233,595 |
| 4,730 |
| 4.08% |
| ||||
Net loans and leases (2) |
| 20,369,297 |
| 602,494 |
| 5.95% |
| 18,853,257 |
| 607,898 |
| 6.50% |
| ||||
Total loans and leases |
| 20,543,659 |
| 605,157 |
| 5.92% |
| 19,086,852 |
| 612,628 |
| 6.47% |
| ||||
Total interest-earning assets |
| 27,261,868 |
| 724,678 |
| 5.35% |
| 24,598,817 |
| 714,549 |
| 5.86% |
| ||||
Cash and due from banks |
| 981,559 |
|
|
|
|
| 927,628 |
|
|
|
|
| ||||
Allowance for loan losses |
| (271,438 | ) |
|
|
|
| (281,388 | ) |
|
|
|
| ||||
Goodwill |
| 651,919 |
|
|
|
|
| 730,084 |
|
|
|
|
| ||||
Core deposit and other intangibles |
| 68,492 |
|
|
|
|
| 80,516 |
|
|
|
|
| ||||
Other assets |
| 1,739,386 |
|
|
|
|
| 1,613,662 |
|
|
|
|
| ||||
Total assets |
| $ | 30,431,786 |
|
|
|
|
| $ | 27,669,319 |
|
|
|
|
| ||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
LIABILITIES |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Interest-bearing deposits: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Savings and NOW |
| $ | 3,317,978 |
| 10,039 |
| 0.61% |
| $ | 2,851,035 |
| 9,849 |
| 0.70% |
| ||
Money market super NOW |
| 9,061,645 |
| 42,901 |
| 0.95% |
| 8,893,693 |
| 51,311 |
| 1.16% |
| ||||
Time under $100,000 |
| 1,470,942 |
| 13,422 |
| 1.83% |
| 1,714,229 |
| 20,982 |
| 2.47% |
| ||||
Time $100,000 and over |
| 1,217,271 |
| 13,458 |
| 2.22% |
| 1,301,153 |
| 17,962 |
| 2.78% |
| ||||
Foreign |
| 271,173 |
| 1,253 |
| 0.93% |
| 158,088 |
| 790 |
| 1.01% |
| ||||
Total interest-bearing deposits |
| 15,339,009 |
| 81,073 |
| 1.06% |
| 14,918,198 |
| 100,894 |
| 1.36% |
| ||||
Borrowed funds: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Securities sold, not yet purchased |
| 634,722 |
| 12,017 |
| 3.81% |
| 518,485 |
| 9,758 |
| 3.80% |
| ||||
Federal funds purchased and security repurchase agreements |
| 2,928,308 |
| 13,416 |
| 0.92% |
| 2,578,585 |
| 13,858 |
| 1.08% |
| ||||
Commercial paper |
| 212,531 |
| 1,301 |
| 1.23% |
| 290,056 |
| 2,149 |
| 1.49% |
| ||||
FHLB advances and other borrowings: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
One year or less |
| 422,651 |
| 2,306 |
| 1.10% |
| 145,374 |
| 996 |
| 1.38% |
| ||||
Over one year |
| 230,659 |
| 5,830 |
| 5.08% |
| 239,341 |
| 6,255 |
| 5.27% |
| ||||
Long-term debt |
| 1,623,316 |
| 31,491 |
| 3.90% |
| 1,138,357 |
| 28,865 |
| 5.11% |
| ||||
Total borrowed funds |
| 6,052,187 |
| 66,361 |
| 2.21% |
| 4,910,198 |
| 61,881 |
| 2.54% |
| ||||
Total interest-bearing liabilities |
| 21,391,196 |
| 147,434 |
| 1.39% |
| 19,828,396 |
| 162,775 |
| 1.66% |
| ||||
Noninterest-bearing deposits |
| 5,923,333 |
|
|
|
|
| 4,978,401 |
|
|
|
|
| ||||
Other liabilities |
| 496,907 |
|
|
|
|
| 408,740 |
|
|
|
|
| ||||
Total liabilities |
| 27,811,436 |
|
|
|
|
| 25,215,537 |
|
|
|
|
| ||||
Minority interest |
| 21,781 |
|
|
|
|
| 22,986 |
|
|
|
|
| ||||
Total shareholders’ equity |
| 2,598,569 |
|
|
|
|
| 2,430,796 |
|
|
|
|
| ||||
Total liabilities and shareholders’ equity |
| $ | 30,431,786 |
|
|
|
|
| $ | 27,669,319 |
|
|
|
|
| ||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Spread on average interest-bearing funds |
|
|
|
|
| 3.96% |
|
|
|
|
| 4.20% |
| ||||
Taxable-equivalent net interest income and net yield on interest-earning assets |
|
|
| $ | 577,244 |
| 4.26% |
|
|
| $ | 551,774 |
| 4.52% |
| ||
(1) Taxable-equivalent rates used where applicable.
(2) Net of unearned income and fees, net of related costs. Loans include nonaccrual and restructured loans.
#######
18