ZION - Earnings call transcript Q4 2017 | Zions Bancorporation, National Association

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Operator

Good day, ladies and gentlemen. And thank you for your patience.

You joined Zions Bancorporation's Fourth Quarter 2017 Earnings Results Conference Call. At this time, all participants are in a listen only mode. Later, we will conduct the question-and-answer session and instructions will be given at that time [Operator Instructions].

conference this reminder, a maybe recorded. As now your host, would like Mr. to to over call the Director turn I of Relations, Investor James Abbott. you Sir, begin. may

James Abbott

the discuss recorded. appreciate would welcome all you Latif, And conference conference fourth We that call call quarter this to Thanks of you. is XXXX good And it. being to evening our to clarify I earnings.

Burdiss, overview objectives. agenda Chief will update Executive outlook provide with quarters. Paul brief four and After Officer, Harris financial Officer, our next and Chairman of Chief Simmons, today, strategic provide For on our condition, key Financial Zions' financial our which wrapping the will an for financial up

Risk results available a actual information, session. I which today questions in forward-looking slide executives Scott made forward-looking are that as statements, the encourage Officer; with and question-and-answer McLean, Officer; us to during call, Zions the to President making like Chief during Operating will and may who full copy executives address this review the or Additional we dealing other A at equally deck, with as deck earnings to although, to call. your press We release during are well the room statements applies you the supplemental remind of include Chief would Schreiber, in Ed the disclaimer slide differ materially. this available release, you zionsbancorporation.com. be

of which key this are into these and and strategic financial release, revenue that call. used Zions' continue be net have articulated non-GAAP non-GAAP contain used earnings such of efficiency the management including by measures related substantial to analysts. Therefore, such management the documents, services' and these non-GAAP during participants limit financials one will intend common of of measures presentation are and the provided of to believed be investors reconciliation. the difference carefully the within earnings The be Certain to and industry disclosures. We measures, slides and is to between may and prominently goals been in compensation hour. of and are GAAP call, investors. inputs interest to used are financial terms call are this full references to We to consumers throughout this ratio, several referring by the review to slide the reconciliation to encouraged the disclosures the length this published use measures, are pre-provision A

other related call, to ask During to question the enable now your ask Harris to question-and-answer questions. turn With I limit that, follow-up of to session participants you and primary we time the Simmons. to one questions one over the will

Harris Simmons

early XXXX our in But both inefficiency, of We for considerable included and XXXX. we've achieved through all fourth goals simpler not our very eliminated we call Thank with slide with that our few We go slides, really you, the performance I were high quarter back a highlights and today profitable. beginning of is we am And both are more those finished. a customers. results. lot transformed going Company James. to quarter to to three to easier specific and employees amount the financial provided the are of and goals welcome of quarter. year. the a our pleased some some substantially targets we At and deck level, the talk be On we’ve year you. of We for established full the you for today about operations to some and

and in years in deliver in a continuous quarters expect and improvement should revenue that ways company, efficiency areas investing earnings Our simplify plan culture of established come, identifying we operational financial of while and streamline growth. and to we and result is the to firmly around healthy in rate to

which a specifically the continued the increased the that change pleased if quarter, items over were the were excluding experienced larger domestic to just actually about to law. XX% compares about slide to for have We been year it XX.X%. We year ago at exclude on up the per federal quarter. period, of the But tax which loan X.X% XX% charitable detail ago ratio were able period, adjusted down with the to from banks. related commercial growth, X% large growth Looking for in push to earnings in couple would strong share, efficiency three, the contribution under we is we that directly

displace Again, Hurricane Harvey, was quick year, contribution last million associated several our otherwise some would we we the charitable this contributions quarter. of year in of detailed contribute XXXX We that we and For large XX.X%. outside per of XXXX to expenditures contribution, contribution ratio note the the dollars in communities. full our the charitable as expense to will unusually about which quarter is larger make the the be excluding And fourth contribution. succeeding And the additional beyond, expect and this part efficiency with large A and in year. making contribution contribution.

spending, of portions So some back the that into disciplined remained our portion simply income we’ll and statement foundation. a But funding. XXXX. to front-end don’t ramping in pricing loaded our the charitable we through up We be through be we expect of with contribution combination, doing

fourth of if those and of Loans losses if Our loan include combination the oil experienced justice the percentage excluded from as the the remarkably rate, was annualized was during and so increased led from XX% quarter, includes credit year-ago contributions interest including With or And in of X% department adjusted increase healthy days XXXs a single year XX%; points the loans net quarter. quality, including the cost that portfolio subject another two strong net only in up increase the of remained cost On And previously a quarter. the quarter. as that only year-ago the beta, or in borrowings, X percentage of quarter. factors cost that deposits expressed net over federal funding deposit basis gas a of revenue percent pre-provision a which of to to only outside points beta average investigation funds and with to the due, basis quarter you income, you larger credit improvement, in our commercial four, linked of a revenue, of we've slide our called was XX% quarter improvement, loans are referenced and year decline credit. approximately non-performing or steady decline with more pleased linked up XX% continued prior assets, the regard a loans X% a XX% XX sustainable X in good of first past classified loan points two or charge-offs. XX pretax net charitable reflect exclude basis of pre-provision the it's increase

do growth to be growth which securities of expect foreseeable we not is due significant the benefits as contributor to purchases, the of Some to over the future.

expect pretax raise Open do related continues moderate combined should we growth, Market discipline, and in further funds growth our income pre-provision with the which And positive would expense continued to expect fee Committee customer rate, the we contribute if federal Federal continued loan revenue. operating further However, net improvement leverage. to

outlook. our guidance Although, in or not included that benefit is

of in the the As likely rate seems past, we’ve slow. the mentioned growth

Although, rate we still expect growth. the of strong

done But of the the my earlier the improve XXXX we've visually, already this I've five, ratio slide to Company. in represents all work efficiency comments. to the since highlighted Turning profitability

key for year We metrics, assets six on rate compared on an equity. return Slide a ratio to year the ago. XX% increases. efficiency points XXXX quarter common possible Return profitability basis achieve XX expect of XXXX, two depicts the to push below assets the excluding return on basis XX and in fourth was full to of points benefits tangible

those and have X.X%, return charitable two XX.X%. approximately on contribution larger deferred increased revaluation the equity assets the X.XX%. again asset, common Return items, excluding it would but was on of been However, to tangible tax excluding

We’re continued assets on improvement remained focused to on peers. relative encouraged competitive by achieving our the returns and

held year-over-year the term We more well slide a national estate, attrition loan continued commercial experienced and investment real X% growth. attrition was estate in the million percent despite growth of as All seven. oil told portfolios. $XXX or in as real loans about for to gas portfolio, Moving than the

business past comfortable personal $X.X generate to generally over strong. policy we to process, economy We're slightly, of all will rather with billion, small Loan wholesale and about to the middle should is loan in past continued loan over due with incremental deposit growth deposits by optimistic new which which the growth entirely tax the be dollar than year, we The growth to which helpful outpaced declined contribute or We funded that are borrowings. market X% moderate concentrations. year origination Deposits accounts. is almost large made our some improvements growth.

source are of And not deposit and We've pricing. deposit but around as disciplined several for funds smaller the accounts, on remain personal both are. sensitive billion of asset over dollar quarters, the therefore, that balance of majority to our some to customers earning some Paul customer price we deposits deposits, accounts. the business larger We our opinion, be time larger expect We in as for next growth. and managers to of balance expect sheet turn detail. off to to Burdiss in funding should months financials asset the of review I'll that Paul? course the overview, additional sheet With that will few to our experienced be pressure sweep our likely over for return

Paul Burdiss

evening, good on everyone. slide eight. and I'll you, begin Thank Harris,

For Zions net $XXX reported per the or fourth diluted of of million $X.XX earnings applicable share. shareholders common quarter XXXX, to

items, them performance we've on will made the financial we on couple our of commitment you detail is financial delivered Here to of that X, XXXX, repeat and add won’t here. XXXX. June with I note I are that the pleased successfully of so key

revenue the of $XX interest the nearly revenue. demonstrate quarter increased approximately the and year first which interest prior increased Let in transition one-third discuss Interest substantial to With recent growth respect million, which period. came net or of trend fourth revenue $XX nine relative Nearly income, portfolio. to depicts drivers, XX%. comments rates. comes I'll in XX% loans from interest few income make from the earning a two-thirds to Net net resulted our me from income. continue Slide income about million then volume investment asset approximately to

the right, to of gas portfolios respectively. X%. left size, including over owner commercial the key the grown balance the don't size real experienced the we loan the ago contribute loan oil sheet. while a growth, by range, investment Slide declining in industrial loans. circles estate is loan the loans. portfolio. from Although, our to portfolio year net smallest size the and the relative relatively growth ordered The home chart years Commercial relative has to our revenue we we by effects of loan the municipal not strong growth away family growth, recent portfolio, experienced estate past, was to and investment pre-provision all to the significantly discussed portfolios occupied national The construction income. of equity we a and land period. to are XX type size real mid four growth and circles of graphical development contributor to take expect general on representation is interest from and has in as single relative digit largest in this loans We Total to been size represent several one meaningful stability net past a term to the and do increased of and appropriate now The in across loan the balanced the growth in have portfolio slide which growth portfolio this, and

in expected, loan national growth by at is and experienced we and right oil gas product Shown expectation our estate real type. declines bottom loans. for loans As the

estate mid generally concentrations plan are and real real which the estate rates single are We digit growth commercial with rates. loans grow our overall comfortable loan to at with commercial consistent

points three increased from year although, national cost We loans in do of the period. to over expect headwind quarter basis of and relatively rate components year to basis line to net or quarter, estate deal FDIC. margin. from points increase to the to our about Slide experienced real The is key expect prior XX increased ago we And from XX top minimal stabilize breaks increase expect the and portfolio oil due somewhat. down purchased be loans relative years. to decline points reduced which the yield, and basis loan X.XX%, XXXX, two compared possibly to benefit we the Meanwhile, ago interest gas don't we prior

factors stable than loan level. include loan a touched from tax hikes, basis in and was deposit the two New include from fourth yield up points XXXX. higher to generally Without of a production for and loans current back Favorable costs quarter deposit the loan the factors portfolio total while municipal on points hike future the and on we points basis the the our expand from the from new year remain earlier. his our FDIC yield income on portfolio. adverse December expect on funding to production, rate Harris basis cost effect average the increased But bit loans purchased ago. the on to rate comments, XX XX

deposits XX mix Reflected points beta. lower average a a and in earning increased in the so XX% funding basis basis time, both rate basis is from the about or has expense, the borrowings which funds federal beta includes X%. Interest as During expressed of total called borrowings points XX rose of or change which deposit percentage and points, assets. the left deposits XX of a

of of point this of mix year primarily to to earning was loans, declined X the business lower during result to headwind deal SBA small past the experienced we slightly. or basis shift, loans premium about concentration This amortization assets. association securities. margin The X administration due security percentage points on As due relative a higher

discuss all followed past have a we portfolio been rate expect and to heard who Company slightly flow economy improves, else portfolio some over you've premium high a premium quarter. our yield SBA higher we this Therefore, us securities you relatively associated would the have we for the the would them; cash and the reinvesting increase the investment during higher due of equal, broadly, occur did which that of expect those securities average More into with have securities longer For as amortization yield. than higher yield term. prepayments, portfolio a that with to marginally from time,

term, On the of a term base. the page that right longer and interest a reset medium percentage table of shorter term side the loans depicting rate have is

increase reaction and longer term the yield better understand loan of target may rates. portfolio rate the detailed quarter on short the interest the rates the December the margin relative and portfolio loan to rising Overall, quarter benefit to as should the we effective expect have help. XXXX our term We on and possible net swaps from relatively interest you that in fourth of versus the some floors funds so rising stable rate to XXXX first be Fed timing

rate securities the XX, by municipal about the this show its be tax which we beta. the the model basis will a of However, immediately increase effect environment on portfolio deposit interest to estimate of margin. on which income net would yield, reform across income, basis headwind a that is offset points we X to and net be This current level. effect assumes higher generate impact interest interest loan XX% in XXX the and X% to relative points net slide in curve On

immediately time ten a to raise we the quarter before of On of the on right the last beginning tightening began where the comparison the rates. the rising shows versus experienced this lines environment rate that Fed

as Reserve, to this to only move so the basis up deposits to Federal costs been move Zions, at comparable about far points points compared a by deposit sensitive For of XXX for compared relative as cycle the points a higher cycle X less Reserve. prior last, point basis the XX in the by the similar Federal basis have

of ratio from very small a and deposits. granular of a very sized portfolio small businesses medium and have balance very base a high deposit consumer with We accounts granular

that low the of the may term. for in expect cost increase We deposits near our remain

Beginning $XXX on we fees million a lines $XXX from year was fees, $XXX a period relative slide, charges, this ago. X%. favorable each from experienced fees X% a Most increased Total income. year loan service to ago deposit are period. Turning increase customer and shown up non-interest million year to from million a non-interest million, the Treasury management to in improvement year which card about and a ago. $XXX slide with included X% related experienced with increasing XX ago about income

have portfolio. to with credit increased and his will XX foundation. the Hurricane compensation and remarks. from occupancy depicts the period; the improvement you quarter, damage prior quarter by higher explained this to ago Houston; versus year this estimated other for Harris prior Harvey charges and high Slide due unfunded ago markets expense of so level $XXX employees; the XX year as to items, businesses may to $XX the million discussed, commitments of in trust the non-interest up excludes charitable expense We've only deposit adjusted to If release, in would earlier, due accrued as quarter. from slightly ago few and incentive management, about performance the year-ago profit quality the on funds profitability non-sufficient as million in pay year in the increased for recall million; and expense we third echo and mostly is year declined overall quarter other non-interest the million service X% capital one provision points; wealth in includes salaries the certain employee for such about charitable incremental if items from increased experienced similar lending foundation, increased to A retail declined $XXX for Non-interest associated metrics non-interest this million ago and $XXX million expense in and $X to $XXX benefits provided overdraft the year; larger and XXXX, by products. relative severance, the Harris sharing in substantial part period. press adjusted the I Furthermore, property strong in slide in which mentioned from $XX However, contribution some fees. notable our lower the been last results year period. loan quarter comments contribution from million the

Much that assets charge-offs. meaningful the net and see classified measures. and loan, due to the remain oil improvement in came optimistic will non-performing with favorable and further changes oil encouraged we are continue gas portfolio to and from the of improvement we credit gas We

in loan shown And commercial on slide, criteria. have rate both this and portfolios the not consumer our risk real-estate five the the loan materially remain on our and commercial on the substantially improved average Although, we we disciplined past years. weighted and commercial during underwriting

compensation, tax the of And tax with revaluation provision of we year the the rate about a investing statutory state's to the state rate. on known while fourth associated these will this taken XX% former of first And excludes alongside the pretax effective after expect half cover for rate expenses Slide our the tax third of exercise expense manageable as XX ASU XXXX-XX. the assets growth. of the representation reduced tax stock structure items incremental about losses credit X.X% much is costs, such, statutory and and expense based bar XXXX deferred the As benefits which of as tax. tax in the credit for and to is loan the X% with such is presented federal of the visual our or in quarter due

representation On a important what the beyond, statutory caveat. the and expect and rate will be of for is we one side right with XXXX tax effective

for change our experience XXXX states key objectives On XXXX law. maybe which between a the XX%. a to the XX federal to tax and we and evaluating an our XX% tax list tax structure state be of XXXX to comfortable may reaction to likely is the their effective in outlook and slide that tax business the in of feel commitment rate giving shareholders. is Some in we Nonetheless, rate. thus, And change do the we

committed operating achieve are leverage. to positive We continuing fully to

in grow to behind improvement years and of committed profitability remain our our improve processes. further earnings. three We operational and simplification have effort We us to materially

revenue of continue the Fed increase and contemplates effect improvement municipal net employees. to in efficiency at single-digits. expect of higher on from to the the loans will XXXX tax And to also change our assumes and the in and paid bonuses and at the law increase that We the funds salaries ratio a December the many rate and outlook impact rate. the high in the experience pre-provision This securities

in Although, not net other does or it rates. increases benchmark interest any assume further

to substantial returns includes still to are we We those technology indicated XXXX, room core going we be that our be much improvement. is to significantly targeting could well to more for goals, invest continue which on improvements, substantial Back and expect we towards seen capital in although the overhaul that are then there systems. tracking in

Regarding the site. of of returns have a appropriate see the testing amount peer common are increased responded rank as to driver median to our and within leverage view you enquire regulatory Unless consideration primary stress capital, as profile X.X%, of often stress level one that stress that run tier the reduction a our risk balance was post given the the we single of and it minimum result results highlight the is we peer level sheet we equity appropriate, our the particularly can company. and and But to the increase we have number, test group. ratio capital X.X% above well moderate of a our where media company Web second above is on A threshold.

For time. median to we to respect decline capital. is is somewhat We median the over that to remain with peer it reasons, recognize the believe than peer various stronger important likely

relative for while threshold is is a absolute And peer-median an test us, stress threshold. the the analysis so

Now moving to our slide outlook. XX and

for an digits. be outlook is the maintaining interpreted as growth increasing, growth which mid-single moderately are loan to an annual in We at

rate We this in interest We to increase additional expect no income months. XX hikes net the assume over next outlook. moderately

do the rate we hike. into December Although, our view, incorporate XXXX

funded short-term Additional We increases expected both fourth interest credit income. of includes which unfunded million commitments are provision loss, minus posted quarter. net for net in $XX improve a and rates the in to

our that expectations may a outperform trend been credit which to lower costs expected, continue. and have Asset than quality continued

the credit next to experience zero. case In quality which words, may a we for calls for our offset several is by continues losses base However, greater may that quarters be improve, credit release scenario other provision reserve offs. than modest Customer-related are as should and which fees, quarter. ongoing fourth losses, release securities new income dividend gains in charge and net our the for the defined we increase off loans from reserves reported exclude and level slightly and press in expect, over course

income As remains key earlier, the I fee for company. the mentioned focus

the Although, relatively the quarter is level recognized strong. fourth XXXX outlook that was

$X.XXX expect slightly XXXX the higher of clear to the foundation, contribution To on Excluding we earnings the at was $XX $X.XXX $XX contribution, XXXX base adjusted XXXX. less expense would rate rate of charitable expense which arrive million release, an level. than billion. non-interest increase non-interest billion, the effect Company's for full digit expect of as be be the From million page to year would growth of one XX a in the the the low adjusted we single shown for

future and Excluding as the tax $XX expected to over quarters, price from fluctuate the upon both XXXX effect approximately warrants stock predominantly full Preferred of the dilutive year million rate expected of is repurchases dividends based be compensation, XX% next dependent four the share stock. diluted and is shares are warrants. the and due The earlier. for may effect between to the to the outstanding dilutive stated effective XX% be

You appendix This may on the questions? prepared in the sensitivities remarks. our you for Latif, please the warrants diluted on further Thank outstanding. you. concludes shares line effected see open would

Operator

line first [Operator comes Jaffray. from Barker, of Our Kevin Piper question the Instructions]

Your question please.

Kevin Barker

quite of a bit a see in again higher. through securities yield walk fourth yields about we securities bouncing saw why quarter? Could some to made you're and of starting You the go comment the back up decline reasons that quick you given the back

Paul Burdiss

prepared our we're securities. fourth on premium really And those SBA the noted to them. relatively prepayments in to in and quarter as related remarks was experiencing attached decline high as you know, a my have The

relatively disproportionate to, of So types say lead minor other in to I relative yield. changes in the changes securities, prepayments will can

equal, make was that actually are to things higher today off. the coming yield the So all than have was I that buying other we're securities the trying that that securities point a

point on coming again and so are And similar securities the of kind yield securities characteristics, the yield risk higher buying yield extension have was than with we're a that duration the today off. the my time, over

things all again other over time, yield we over the therefore would to expect so equal, time. creep portfolio And securities up

Kevin Barker

you're fee And fees. income, seeing then your for facing in for also increasing customer noticed guidance I slightly

income of Or been it slight a decline in fees, Now, just growing fee couple particular. years. to over a a roughly is Was reason why you're last a seeing the related at has as whole, there? clip X% the maybe customer there

Paul Burdiss

my in the Well, fees. was came there I comments, pretty as the in to And to prepared core strong. quarter item say fourth tried really related

that a fourth And fourth over time, view, so that's will fee quarter growth are because really say continued specifically that reflects. what income. in single to I target page digit is quarter think core clearly our comment mid to I we

Operator

you. Thank

of of Our next question Steve comes from the Moss line Riley. B.

is line Your open.

Steve Moss

I was discussed are Where wondering, you growth quarter. we saw from estate this you just that real that commercial seeing here?

Harris Simmons

repeat Could that? you

Scott McLean

growth Commercial real estate quarter… this

Harris Simmons

from going Where it you're see you here saying?

Steve Moss

trends in future you or should we here, you similar know the those seeing Where where do here? it from where are seeing expect you sources of and growth --

Scott McLean

quarter really commercial McLean. I in would can declined see year portfolio see. growth pick-up to and This just you last the a But in real that Scott we did is general start anticipate say fourth we portfolio, estate that as seeing it’s portfolio the consistent with franchise. we're currently. portfolio And across the as And which XXXX. rest term it be with the consistent of mix opposed CRE predominantly construction, throughout the the is of should our to

Steve Moss

And if margins would March, the get rate to hike benefit be? we expect the what in another were to to you

Scott McLean

lot a disclosures provide we this. around Well, of

on the the that the I so effect shape somewhat on have of dependent of is So is also to that the answer answer directly, that don't can't question the I because curve. because margin that answer

can the rate. by And change our net to in of in be remember I impacted right, heavily see that margin. on so changes change I in in loans going the XX% if slides near on the referenced are you rates the term deposit -- we’ve influenced the about, got interest are Obviously,

at a margin. looking the So of together all couple in points improvement probably net-net, that you're basis

Operator

you. Thank

comes Sandler next the Brad of O'Neill. of Our question Milsaps from line

Your line is open.

Brad Milsaps

structured. Harris, how kind curious targets primary the management now the just it's efficiency I out guys was laid of goals, in of are your for kind XXXX and multiyear incentives and you

of obviously as for past big that, still that there curious targets of you've the the the is you the [indiscernible], to amount old have given and to what you commented shouldn't have years out banks apply hold kind guys? been of returns And kind follow-up else capital banks of in those where Just driver measures out efficiency for in a that anymore. maybe rates had the have

just might Just about above be the guys for that curious kind ROA, kind returns still helpful? capital, of in lot regard a you are be but industry of any would of X% you have additional what now now thinking color

Harris Simmons

like Well, think I to I if you three -- kind we slides years we've and in we we're way middle something to should where out were the focus -- to as the two efficiency of measures be Sure. ratio. it – we’ve think terms that back on in of of was go been we've of demonstrated here. third ago, at, progress way in in we lot made terms -- important when of probably have to the We shown some looking a going of

expect more do -- pace over operating I the terms trend in thereabouts. growth we kind we to internal is, leverage the shifting improvement rate initiatives we much how little of working pretax trajectory digits, earlier we've am net it's obvious. confident. is on internally improvement. same We opportunity. as and get as costs, see further time will And closer lot ratio, the single which quite the pace where a our that that as at that And work will fruit improvement, very there's efficiency we help pace not and of reducing of focus on the to we're of tougher continue focus XXXX focus of -- making think becomes the hanging low everything on, a us we I the possibly can. there on. been still of continuing goes on our I same will growth really expect industry as you that – incremental towards, as but be I in continue be a see high slower lot we that think is was of think revenue, efficient making -- PPNR, I but that to can internally And XXXX. can we'll grow in pre-provision we can't of a lot I same It and somewhere a at again at

way. things results on into that this own our our own I of possible the shareholders. and protects on that to stress results focus the intent. incorporate communicated capital. lot it continued As to more continued to a the a whether test payout. triggered with as that good a bank those up driver, questions It's work incentivize to what's it Paul will I the And create big a far the of some going - the merge how focused a and as are the be And other merger to to of to sort of generally. our and happening in will as one-time structure when are we've on we We to economic structure best to pricing it some to be that we investors doing generates major be certainly will pricing announced happening things in was disciplined sure ramp really of be bank, everybody's capital we sort what's levels risk that to -- internally want goes, the adequate adjustment capital really produce mentioned, and the profile, that company frontlines into I that our capital rightsizing from terms expect holding And aligned do And incentives the wasn't we in providing environment return. also while out towards everybody for industry orderly trying that think in and at and like looking in intent expect create terms

we levels continue going a So how our goals I out pay it, little of as the a guess capital about today communicate continue except I to specific size just pace. any that we giving I'm to we that expect to have what's don’t at in balance terms are accelerated grows will window into and happen of right going capital somewhat we thinking that sheet are kind

Operator

Thank you.

Our the of from next Jefferies. of question comes line Usdin Ken

line open. Your is

Ken Usdin

growth. on was if little expense you elaborate can a bit drivers I the wondering of Paul, just more

were you about, How how to single, talking would kind low single? First terms you would consider the help days? of us of you understand but I low define the you ranges just guess mid help for that what XX understand XX of us in you off

Paul Burdiss

there; Ken, of a about the super you charitable expenses that you kind used in X% and to and depending kind we last see measuring specific similar we contribution increased slightly if kind of are once publicly discussed. recall you we you however, Zions factor Bancorp or talking may not higher up where it that the of increase X% are we year open another can return story,

Ken So net kind of that's hopefully I'd it's ballpark helpful. the say

Ken Usdin

seven programs weighing X% guess terms Yes, then fourth some the any spend quarter? you anything have it tech incremental a and projects? you do what that in of while? the just on how long you’ve had and I do issuing X% you ongoing on did on top a And to do about year keep in of Or you accelerate long-term tax that ballpark. thought everything for the of plan than just in are you

Scott McLean

Scott it's McLean. Ken,

me we say number. a clearly driver respond just areas on finding municipal of just there it. and initiatives income all described employment growth like the Paul adding quantitatively. We few. that Let is bankers and number based has I areas primary simplification would When expense described, growth to to described lot part Harris strong parts, that -- and which fee but our to money more And mention mortgage, bit qualitatively, at cost look finance, are the we particularly of wealth of are just you ways save a moving you are time the of our

bankers our and future very our three just our replacement long the our driver adding in of talked technology we this bankers and secondary are but you long driver adding general about business the its year XX% and most income is on projects XX% then capabilities the years as a it's are bankers our we making comparative and areas so the faster trying would tax be the basic small So, spend It's defensive noted fundamental more there much running primary were systems to there been of would more a digital probably I leaning, the six would to number system, technology on X the offensive driver five and there franchise we're we're one just technology X And expense well. numerous or as growing commercial we long advancing of spending ago, fee on be to appropriately. cost core that just and investments in systems much across project one and side technology of are so the quite shop two keep our is ago and we're the the deposit forward systems. years say

Operator

Thank Marty Sparks. of you. And Mosby our next Vining question from comes

is open. line Your

Marty Mosby

start and even impact is over Paul, impact that last stock you look warrants. still goal wanted impact it little when price of that curve to year share going prices go you that you kind less? the share increase as last share of that that Is the And down becomes looks there goes count diminishing ask by be -- count expectation accelerated though higher two about XX, stock these from as the can repurchase the you of because now like over quarters dilutive is up how the a the higher. warrant, at into may

Paul Burdiss

although would overly got then a that it your slightly very first curve not I but there sharp pronounced. curved. would know I linear that curve is I more is describe is Well, you eye say point Marty probably

would expect remarks continued shares price plan last exceeded said share and All our the ability It's move So price other increase just the -- fundamentals to I our course more share on to here then diluted buy some under off experiencing over is depending have have out couple direct kind years. from equal we a significantly to the what share share that been if doesn’t obviously, in stock. been of price things go my again pretty of much prepared upon reaction we improved you as back outstanding. the have repurchases impact that our capital is has of

Marty Mosby

expenses more we of those here to kind really But how that’s just and see thing talked to you're significant able much And -- run, about shortly. other the really a that scene the a in you the going beginning overtime. in? going because They've spend short then systems you capitalizing as we to about, project. one, Day two suggestion you're outline, That been such really that coming has the there then talk kick see amortize they to really get start that up technology really what behind been highlighting were to And Investor capitalized with and kind they as run kind to play? out then are the the is start they much benefits how don’t eventually

Scott McLean

simplification is It’s Marty, we Day. and Investor as great many focusing on our Thanks on we a to point well well it's as on about. will Scott. subjects do talk initiatives plan that

Operator

you. Thank

Autonomous of comes the Our Geoffrey next of Research. line question Elliott from

Your line is open.

Geoffrey Elliott

simpler, when decision until see why talk made about significantly holding in legislative is to particular and in bit decision you on The how announced regulation to underway dropping of process a that something the think could you the outcome decided then there one structure move and away timing that from do? a could a the curve reduced to the bank you as whole result that way company

Harris Simmons

name sort asking operations, myself bank. and different at done Sure. presence the I required were of life. that that process we that I benefit the ask be say was simplifying about and we can the as and of look what Once charters think company. in perspective ago, consolidated doing in call subsidiaries and operationally a frankly, having we I be a business done consolidate myself business everything what I particularly virtually had our lines of in guess done holding half bank? would And can’t we're businesses can in What in we And bank bank? mix terms be a a in of a year -- the seven began of holding banking we I the question charters as a the we to various company. decision had and the made a

There's been were going find things likelihood there but ourselves prohibited investments down for that winding and and also some that and the are engaging past best which things that Walter example underwriting by could a the you those of holding in now a some are you holding can the times you we're in commercial that to do equities and know in my probably merchant do really view of bank. you Now of you some we've rule in we're very-very left that do little a with a companies. bank, and do there's can small can't in to domestic precious banking company set you know that large company

merging you time in legislation pretty America anyway lots in set said of more the And we know I every that investigating helpful was opportunity, the we on mindset will we so been of highly think deliver $XXX give good of seeing terms the set regulation, that give at what years. this so we won't well. do Crapo you company but holding regulation supervision, know the dawn that subject turnaround, I us one should it I'm it which doing thing that's so stress we've because us regulator in fundamentally business Crapo billion time where legislation us federal bank the probably and know ultimately bill And than in what working the coming and altogether our the cut to Congressmen on most the of etc, so there's be a bill, that to landscape favor they this that in overlap the is I duplicate but But case to the talked banks we Fed's think lot it OCC they're and in and spent their and test think a I recent think of eliminating I threshold can I I hoped reserve deliver the examinations. that increasingly any right still certainly couldn't and you as a sort about models into will that it, banker lot of to being pass. And have duplicate I in performing it's mean I was will could a said thing that the

it. So, fundamentally the that's reason behind

Operator

you. Thank

from of comes of Morgan. Alexopoulos question the line next Steven Our JP

please. question Your

Steven Alexopoulos

see like the on might impact credit your I'd cash tax I'd to your need have and customers. as quality? that for material coming thoughts commercial if reserve. down basis, I'd the flows regarding improve upgrades a hear for imagine on you a net love and start rate to this, on could corporate that

Harris Simmons

out from -- we base, on we quality. the the coming of the there's core take and some small economy the don't are smaller commercial to the -- some on and nor Yes, business our the of because either effect jury are nor expecting side I extra know material some don't we're are than generally in a clients particularly clients clients, expecting of of much look of big use that, our offshore larger our larger personally think I in lend on markets. obviously, not client debt. as and some borrowers speculation am otherwise There's also among which middle a may to change expecting those we you credit different kind our that to down cash pay again that

a of be the effect as lot to seen legislation economy. there's tax the think yet through Although I the shakes

Steven Alexopoulos

a each little C&I decline saw those? in an Can Then give a quarter-over-quarter Bank of CB&T. question million you $XXX unrelated but growth, on loan on Zions nice growth you had color

Paul Burdiss

Yes, the moment. I I able have more Investor a activity We in I know end fact don't may we could little there Day you lot at details. you insight. at don't just to that be was and give give our the -- that color at quarter a of

James Abbott

James, rebooked large some is the loans as being I'll geographies being just with in as of there've type this some utility been maturing little scale or our from Steven, it, exist. which they though jump that they been bit have deals in rebooked a mature that part in of are

Bank. have And California been so where for be it. but actually some is moved would of example Utah and to there of that's it some -- energy that lending those being some So, things within of historically types geographically booked alternative based

Harris Simmons

but not it, of in piece a be piece quarter. big would great fourth the There a

Operator

you. Thank

Ken next from Stanley. Morgan Our of comes question Zerbe

Your line is open.

Ken Zerbe

with the Just XXXX long remind of are well. all any the mid In it efficiency release, XXs background the trying of target just peers, out mentioned be as somewhere fundamental core going as -- is the look? higher coming a low press other Just for sort of piece? to the after because reason just why XX% little you back a just spending mid future than take slows? around your there your the down should efficiency or of of ratio. to a call -- the Does like banks technology sustainably us, give sized you similar term farther us it lot the your ratio to go give lot size Can a understand

Harris Simmons

I speak of guess hard that, the low that get to to where listen get to I XX. down -- they it's think additional I'd going are to kind say they boost to some and

in I measure think our which the are we at the group, as think measure progress, to getting peer closing on of we're we which median. sort we a So where we look I point

about we throughout securities end XXXX, growth XXXX that's ratio. the legacy loans and are efficiency of about that are as going of there municipal, into of the announced basis XX.X% the the basis at combines benefit headwinds points noted the points lower with year that couple XX on combined salary for bonuses tax XX portfolio We and

than get think down things as I not but within some guess to more $XX money digital about somewhere our incrementally headwind core were on least mentioned roughly about of the very challenge closer couple out middle and I do kind our of going statement Scott on think that's it that So pack income to replacing better think off are that it's of that annually difficult one overtime through headwinds think the talked systems And we've group. much technology is stand I that's also but the peer of there etcetera. course at basis a million spending gets we points. despite XX we're I the to we get going the the

a we is peers decidedly than a that of of is our smaller from the the is smaller the here any of loan decidedly I our of different but think some kind have and have little model base a that's what loan deposit achieve. of in commercial loan in yields you would lot medium that traditionally we think to at and will to benefits and other size the expensive that produces more kinds it peers it run we also portfolio terms see profile The is I most our end of the of commercial

I but exactly we're within to think I So ourselves I a already months. to don’t nevertheless think find XX that against close very next peers that's to the know where measure factor. here are how going But peers, probably

Paul Burdiss

about I the If I so efficiency between as was not is huge can range I've for a of not that's goals just we there would XXXX just Harris The is said. Ken, consensus substantially just Friday there is our consistent tell are peer top jump in from peer ratio groups XX.X% were you different about what and so planned XX% with today. the cortile said that that

Harris Simmons

is like talk tax provided what points longer X and you to to and near-term, XX% relative. ratio outlook continue just but to kind while what that's peers I necessarily within pro And that so and more a near ratio to things clear that James that’s going would is then effective and of ask number of note improve. just to one. kind to efficiency that revenue lower our efficiency you keep reference to just be that been just other And ratio continued was medium trying our doing know continue I about growth group peer we're decline is and couple to provision also inefficiency change ratio it we be about release is press to one refer in and we Page really XX%. here. I be XX going express that of the would mind not or a not what of that higher I that to the What which is efficiency that where think sounds back in basis have increase topic term is and could And said of a the our

Ken Zerbe

least it have is way year? -- between reads either up. has again, on follow After a for obviously you modest as deck you slide you have and negative quarter several negative provision persistently period actually you could and know just And of say provision or release of reserve it sort I this really Hurricane The but some at there, gas your expense where during possible quarters further the short Harvey oil could quarter.

Paul Burdiss

charge to and line good in some provide I This releases charge seen some say and is until as Paul. of we would frankly continues absolutely a been credit that be continued offs we as would credit have even extent improvement quality as have the noted offs possible. we cases as there possible, to incremental that’s very its here said, may had we recoveries fairly growth, improve long quality we

Ken Zerbe

Okay thank you.

James Abbott

an have end variety and Thanks. We're And we so at go so hour, the just one. its about pick to will we of primary questions so do this and question lighting is one few here round James.

Operator

Thanks.

comes Emlen JMP question from Securities. Harmon next of the So

open. line Your is

Emlen Harmon

for so follow you More of quick parts, I've that. up we got from queued do a can as couple a

drive Just growth and deposit impact just balance of what's in that to on money terms yields? the you the relay potential do sheet, to of on much plan the deposit market balances how to bringing

Harris Simmons

is and respect provided we an Well, I And where that specifics be on we better you affect we a in several that, borrowing yields, is with our we press that which the Page haven't had over said. is can say, the in though bringing our it would borrowings over wholesale you I would and what release and is as on identified expected of XX market. rate at of we may funding significant next course kind these see to specific we how as quarters, can a part at look that be recognize strategy opportunity. the than wholesale now to been think that yield I But about mean very our

Operator

Pancari John from of comes Evercore. question Next

Your line is open.

John Pancari

that just benefit much bottom ultimately you're this with? on more business the thought say Or and your get stay how accrete of get going would the to the to much in likely to competitive you how line benefit wanted back tax to is there? putting or On

Paul Burdiss

it buy and deposit going myself about much you share. I'll try find take not we're to on pretty a out deliberately market I thinking stab and otherwise. Whole like go to, I using basis can like guess.

work a dissipate that, of of will way little is think a markets bit I think probably -- major way. will overtime But time. take the of it portion that end it I

its benefit rest think problems for of I capture most that have as so. just. which go high that is corporate along of will the so incrementally very markets long-time And America XXXX we of class haven't these This one less

Operator

next comes from question Deutsche Dave The Rochester of Bank.

open. is Your line

Dave Rochester

were a that guidance, one opportunity meaning, you are expenses. that to whether rate I on And quick that bunch growth some growth? guys later expense we giving expecting on expense know growth effort. you allow But you expense in some hikes? on still update of one sensitivity as control simplification mentioned an detail Just if any rate see a to for more Could for you? the can possibly see multiyear just you give

Scott McLean

think lot is in that other this made Dave, what company. a just but big I to have think in good has we about we're cost around satisfaction it executing I and I on Day revenue, progress cases, our lot started, at has areas, quickly -- talk customer increases of of of we change, McLean. getting of simplification in just a we're on lot -- we like satisfaction. the, more the been. reduces Scott a those creating and in getting areas certainly there's now and employee is impact as energy And more Investor an many cases subject processes everyone the look it some happen more in simplification really believe but effective this

investors we will So you'll it. think tell more I appropriately -- that I story as think think be story talk that by most encouraged about and more

Dave Rochester

Great. then. Thanks and

Scott McLean

the to from coming just interest have core other solid than know revenue rate see growth sorry growth you things -- expense I'm would mentioned really you we sorry, changes.

terms spending we're be businesses and of think technologies. I pre-income in not are of lean deposit I into growth, driven a loan away inappropriately. rate those fundamentals probably very supporting long and getting people by we'll as those conscious we'll as increasing But increased benefit that think just

Operator

from Securities. Chris comes question Fargo Next Spahr of Wells

is Your line open.

Chris Spahr

of you My customer that year question like is regard be to the up of been firm, fee in that related history posted you've you to lower at income income run fourth hasn't your core fee almost and quarter. income and in changed and fee that this guess the level of for I yet one rate implied put guidance your seems a best least next the much, numbers really a the

happened can start better expected? change in kick the outlook income do what fourth what at than to was kind on that to your least kind fee So that of you And of quarter line?

Scott McLean

to fourth business XQ X% these numbers of Sure, digit we if and at that the just digit think saw to very as really up finance, we're XX quarter quarter treasury mid really whack. fourth guiding of quarter you growth is exchange workhorse put two in growth fee this really income bank numbers But rate that, thank you. to. rates of categories strong we increases happened versus look of foreign those strong it's but last still This about fourth the to management, unusual quarterly municipal comparisons comparisons I is is We this basic know just versus of number single versus some fourth are But others months and XQ saw Having really can quarter where run rate normal year, we our in single 'XX, what little get quarter-over-quarter year great we out felt said products. card. a a all fee income, Scott. This have that related like wealth in comparisons. our mid that

mid are or banking so single kind and these investment selling not growth grow are businesses exotic of rates. generally markets that activities, capital We digit

Operator

for Sir? Thank turn you. remarks. any back I'd Mr. Abbott closing over to At time, the this call like to

James Abbott

of call Thank to on Eastern Investor in on joining the mentioned AM Time, of mentioned everyone a is The -- the Mountain X is release. call an it's today, AM as the that, been We have begin we up you at times expected X Xst. Day XX do Appreciate It Page much. coming couple earnings today. very Time. March event

several for sounds the to you'd be webcasting run us that, although event enjoyable. hours, delighted, we'll join if we'd in and expect more person, be We

to quarter. next or or in for -- in via at And we or the Thanks our call press today. numbers for directly, March much so possible Thank call, the much. contact myself so look forward And please earnings so please if seeing you you listed joining investor@zionsbancorp.com phone release. next us

Operator

you your participation Ladies and and have day. gentlemen, this conference. concludes a today's wonderful Thank for

Zions Bancorporation, National Association (ZION) 22 Jan 182017 Q4 Earnings call transcript