ZIONS BANCORPORATION 
By Company Bolstered Loan Loss Reserves, Strengthened Capital and Liquidity, and Originated
"In what most observers agree is the most difficult economic environment in over half a century, we have strengthened our balance sheet by building record high levels of capital and liquidity," said
Fourth Quarter 2008 Highlights
-- Tangible common equity ratio of 5.89% and estimated total risk based
capital ratio of 14.71%, up from 12.30% at September 30, 2008.
-- Provision for loan loss reserves of $285.2 million versus net loan
charge-offs of $179.7 million.
-- Noncash impairment loss on goodwill of $353.8 million.
-- Impairment and valuation losses on securities of $204.3 million.
-- Capital investment of $1.4 billion from the U.S. Treasury.
-- Extensions of credit totaling $4.6 billion, of which $2.7 billion were
new loans.
For the year 2008, the Company's core banking operations made
Loans
On-balance-sheet net loans and leases were
Deposits
Average total deposits for the fourth quarter of 2008 increased
Net Interest Income
The net interest margin was 4.20% for the fourth quarter of 2008 compared to 4.27% for the fourth quarter of 2007 and 4.13% for the third quarter of 2008. The increased net interest margin for the fourth quarter of 2008 compared to the third quarter of 2008 was driven primarily by the capital investment from the U.S. Treasury, reduced deposit rates, and significantly lower borrowing costs.
Net interest income for the fourth quarter of 2008 increased
Impairment Loss on Goodwill
The Company recognized an impairment loss on goodwill during the fourth quarter of
Asset Quality
Nonperforming assets were
Net loan and lease charge-offs for 2008 were
The provision for loan losses was
The allowance for loan losses as a percentage of net loans and leases was 1.64% at
Investment Securities
The Company recognized other-than-temporary impairment ("OTTI") and valuation losses during the fourth quarter of 2008 of
-- $177.9 million for bank and insurance trust preferred CDOs (17 newly
deemed OTTI, two previous)
-- $7.9 million for one downgraded security purchased from Lockhart Funding
LLC during the quarter
-- $1.2 million for bank and insurance income notes (one newly deemed OTTI,
two previous)
-- $12.0 million for REIT trust preferred CDOs (one newly deemed OTTI, two
previous)
-- $1.4 million for ABS CDOs (two previous)
-- $3.9 million for other securities (one previous)
Lockhart Funding
At
Noninterest Income
Noninterest income for the fourth quarter of 2008 was
Noninterest Expense
Noninterest expense for the fourth quarter of 2008 was
Liquidity Risk Management
As of
On
Capital Management
Tangible equity increased primarily due to the
Significant changes in OCI included a
On
Weighted average common and common-equivalent shares outstanding for the fourth quarter of 2008 were 114,205,587 compared to 106,902,983 for the fourth quarter of 2007 and 108,497,464 for the third quarter of 2008. Common shares outstanding at
Conference Call
Zions will host a conference call to discuss these fourth quarter results at
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. Zions operates its banking businesses under local management teams and community identities through approximately 500 offices in ten Western and Southwestern states:
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: the Company's ability to successfully execute its business plans and achieve its objectives; changes in general economic and financial market conditions, either internationally, nationally or locally in areas in which the Company conducts its operations, including changes in asset-backed commercial paper markets and valuations in structured securities and other assets; changes in governmental policies and programs resulting from general economic and financial market conditions; changes in interest and funding rates; continuing consolidation in the financial services industry; new litigation or changes in existing litigation; increased competitive challenges and expanding product and pricing 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.
Additional factors that could cause actual results to differ materially from those expressed in the forward-looking statements are discussed in the 2007 Annual Report on Form 10-K of Zions Bancorporation filed with the Securities and Exchange Commission ("SEC") and available at the SEC's Internet site (http://www.sec.gov).
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.
ZIONS BANCORPORATION AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS
(Unaudited)
(In thousands, except per Three Months Ended
share and ratio data) December 31,
----------------------------------
2008 2007 % Change
-------- -------- ---------
EARNINGS
Taxable-equivalent net interest
income $514,422 $485,157 6.03%
Taxable-equivalent revenue 432,132 464,923 (7.05)%
Net interest income 508,442 478,885 6.17%
Noninterest income (82,290) (20,234) (306.69)%
Provision for loan losses 285,189 69,982 307.52%
Noninterest expense 398,167 352,966 12.81%
Impairment loss on goodwill 353,804 -
Income (loss) before income
taxes and minority interest (611,008) 35,703 (1,811.36)%
Income taxes (benefit) (126,512) (11,035) (1,046.46)%
Minority interest (1,520) 1,197 (226.98)%
Net income (loss) (482,976) 45,541 (1,160.53)%
Net earnings (loss) applicable to
common shareholders (498,084) 42,198 (1,280.35)%
PER COMMON SHARE
Net earnings (loss) (diluted) (4.36) 0.39 (1,217.95)%
Dividends 0.32 0.43 (25.58)%
Book value per common share
SELECTED RATIOS
Return on average assets (3.52)% 0.35%
Return on average common equity (38.77)% 3.29%
Efficiency ratio 92.14% 75.92%
Net interest margin 4.20% 4.27%
ZIONS BANCORPORATION AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS
(Unaudited)
(In thousands, except per Year Ended
share and ratio data) December 31,
----------------------------------
2008 2007 % Change
-------- -------- ---------
EARNINGS
Taxable-equivalent net interest
income $1,995,368 $1,908,053 4.58%
Taxable-equivalent revenue 2,186,060 2,320,397 (5.79)%
Net interest income 1,971,646 1,881,952 4.77%
Noninterest income 190,692 412,344 (53.75)%
Provision for loan losses 648,269 152,210 325.90%
Noninterest expense 1,474,963 1,404,588 5.01%
Impairment loss on goodwill 353,804 -
Income (loss) before income
taxes and minority interest (314,698) 737,498 (142.67)%
Income taxes (benefit) (43,365) 235,737 (118.40)%
Minority interest (5,064) 8,016 (163.17)%
Net income (loss) (266,269) 493,745 (153.93)%
Net earnings (loss) applicable to
common shareholders (290,693) 479,422 (160.63)%
PER COMMON SHARE
Net earnings (loss) (diluted) (2.66) 4.42 (160.18)%
Dividends 1.61 1.68 (4.17)%
Book value per common share 42.65 47.17 (9.58)%
SELECTED RATIOS
Return on average assets (0.50)% 1.01%
Return on average common equity (5.69)% 9.57%
Efficiency ratio 67.47% 60.53%
Net interest margin 4.18% 4.43%
ZIONS BANCORPORATION AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS (Continued)
(Unaudited)
(In thousands, except share and Three Months Ended
ratio data) December 31,
-----------------------------------
2008 2007 % Change
----------- ----------- --------
AVERAGE BALANCES
Total assets $54,546,364 $50,941,152 7.08%
Total interest-earning assets 48,708,673 45,106,413 7.99%
Securities 4,516,559 5,188,980 (12.96)%
Net loans and leases 41,938,586 38,450,974 9.07%
Goodwill 1,720,536 2,009,022 (14.36)%
Core deposit and other
intangibles 130,703 162,679 (19.66)%
Total deposits 39,580,867 36,381,125 8.80%
Minority interest 28,751 32,343 (11.11)%
Shareholders' equity:
Preferred equity 961,072 240,000 300.45%
Common equity 5,110,430 5,094,138 0.32%
Weighted average common
and common-equivalent shares
outstanding 114,205,587 106,902,983 6.83%
AT PERIOD END
Total assets
Total interest-earning assets
Securities
Net loans and leases
Allowance for loan losses
Reserve for unfunded lending
commitments
Goodwill
Core deposit and other
intangibles
Total deposits
Minority interest
Shareholders' equity:
Preferred equity
Common equity
Common shares outstanding
Average equity to average assets 11.13% 10.47%
Common dividend payout n/a 108.88%
Tangible equity ratio
Tangible common equity ratio
Nonperforming assets
Accruing loans past due 90
days or more
Nonperforming assets to net loans
and leases and other real estate
owned at period end
ZIONS BANCORPORATION AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS (Continued)
(Unaudited)
(In thousands, except share and Year Ended
ratio data) December 31,
-----------------------------------
2008 2007 % Change
----------- ----------- --------
AVERAGE BALANCES
Total assets $53,761,908 $48,847,219 10.06%
Total interest-earning assets 47,690,955 43,048,458 10.78%
Securities 4,825,234 5,406,682 (10.75)%
Net loans and leases 40,977,224 36,808,146 11.33%
Goodwill 1,936,865 2,005,245 (3.41)%
Core deposit and other
intangibles 136,698 180,783 (24.39)%
Total deposits 37,572,680 35,823,969 4.88%
Minority interest 29,156 36,385 (19.87)%
Shareholders' equity:
Preferred equity 431,936 240,000 79.97%
Common equity 5,107,675 5,007,627 2.00%
Weighted average common
and common-equivalent shares
outstanding 109,144,836 108,522,864 0.57%
AT PERIOD END
Total assets $55,092,791 $52,947,414 4.05%
Total interest-earning assets 49,071,281 46,448,887 5.65%
Securities 4,509,308 5,860,900 (23.06)%
Net loans and leases 41,859,056 39,087,779 7.09%
Allowance for loan losses 686,999 459,376 49.55%
Reserve for unfunded lending
commitments 50,934 21,530 136.57%
Goodwill 1,651,377 2,009,513 (17.82)%
Core deposit and other
intangibles 125,935 149,493 (15.76)%
Total deposits 41,316,496 36,922,753 11.90%
Minority interest 27,320 30,939 (11.70)%
Shareholders' equity:
Preferred equity 1,581,834 240,000 559.10%
Common equity 4,919,862 5,052,800 (2.63)%
Common shares outstanding 115,344,813 107,116,505 7.68%
Average equity to average assets 10.30% 10.74%
Common dividend payout n/a 37.82%
Tangible equity ratio 8.86% 6.17%
Tangible common equity ratio 5.89% 5.70%
Nonperforming assets $1,140,461 $283,854 301.78%
Accruing loans past due 90
days or more 129,567 77,419 67.36%
Nonperforming assets to net loans
and leases and other real
estate owned at period end 2.71% 0.73%
ZIONS BANCORPORATION AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS (Continued)
(Unaudited)
(In thousands, Three Months Ended
except per --------------------------------------------------
share and Dec. 31, Sept. 30, June 30, March 31, Dec. 31,
ratio data) 2008 2008 2008 2008 2007
-------- --------- -------- -------- --------
EARNINGS
Taxable-
equivalent net
interest income $514,422 $497,822 $490,587 $492,537 $485,157
Taxable-
Equivalent revenue 432,132 587,432 562,959 603,537 464,923
Net interest income 508,442 492,003 484,743 486,458 478,885
Noninterest income (82,290) 89,610 72,372 111,000 (20,234)
Provision for
loan losses 285,189 156,606 114,192 92,282 69,982
Noninterest expense 398,167 372,276 354,417 350,103 352,966
Impairment loss
on goodwill 353,804 - - - -
Income (loss)
before income
taxes and
minority interest (611,008) 52,731 88,506 155,073 35,703
Income taxes
(benefit) (126,512) 11,214 22,037 49,896 (11,035)
Minority interest (1,520) 3,757 (5,729) (1,572) 1,197
Net income
(loss) (482,976) 37,760 72,198 106,749 45,541
Net earnings
(loss)
applicable to
common
shareholders (498,084) 33,351 69,744 104,296 42,198
PER COMMON SHARE
Net earnings
(loss) (diluted) (4.36) 0.31 0.65 0.98 0.39
Dividends 0.32 0.43 0.43 0.43 0.43
Book value per
common share 42.65 45.78 46.82 47.49 47.17
SELECTED RATIOS
Return on
average assets (3.52)% 0.28% 0.54% 0.81% 0.35%
Return on
average
common equity (38.77)% 2.59% 5.53% 8.18% 3.29%
Efficiency ratio 92.14% 63.37% 62.96% 58.01% 75.92%
Net interest
margin 4.20% 4.13% 4.18% 4.23% 4.27%
ZIONS BANCORPORATION AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS (Continued)
(Unaudited)
Three Months Ended
(In thousands, except share ----------------------------------------
and ratio data) December 31, September 30, June 30,
2008 2008 2008
------------ ------------- -----------
AVERAGE BALANCES
Total assets $54,546,364 $54,279,760 $53,293,375
Total interest-earning assets 48,708,673 47,984,725 47,202,577
Securities 4,516,559 4,582,727 4,866,421
Net loans and leases 41,938,586 41,984,123 40,512,249
Goodwill 1,720,536 2,009,509 2,009,517
Core deposit and other
intangibles 130,703 132,167 137,675
Total deposits 39,580,867 37,321,656 36,774,214
Minority interest 28,751 29,949 27,244
Shareholders' equity:
Preferred equity 961,072 282,500 240,000
Common equity 5,110,430 5,123,399 5,070,047
Weighted average common and
common-equivalent shares
outstanding 114,205,587 108,497,464 106,711,948
AT PERIOD END
Total assets $55,092,791 $53,974,168 $54,630,883
Total interest-earning assets 49,071,281 47,656,065 47,920,419
Securities 4,509,308 4,755,359 4,784,185
Net loans and leases 41,859,056 41,887,693 41,872,977
Allowance for loan losses 686,999 609,433 548,958
Reserve for unfunded lending
commitments 50,934 23,574 26,838
Goodwill 1,651,377 2,009,504 2,009,511
Core deposit and other
intangibles 125,935 133,989 132,481
Total deposits 41,316,496 38,590,901 37,607,995
Minority interest 27,320 30,288 25,528
Shareholders' equity:
Preferred equity 1,581,834 286,949 240,000
Common equity 4,919,862 5,279,078 5,033,530
Common shares outstanding 115,344,813 115,302,598 107,518,975
Average equity to average
assets 11.13% 9.96% 9.96%
Common dividend payout n/a 138.44% 66.23%
Tangible equity ratio 8.86% 6.60% 5.97%
Tangible common equity ratio 5.89% 6.05% 5.51%
Nonperforming assets $1,140,461 $924,442 $697,432
Accruing loans past due 90
days or more 129,567 97,831 108,934
Nonperforming assets to net
loans and leases and other
real estate owned at period end 2.71% 2.20% 1.66%
ZIONS BANCORPORATION AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS (Continued)
(Unaudited)
Three Months Ended
(In thousands, except share --------------------------
and ratio data) March 31, December 31,
2008 2007
----------- ------------
AVERAGE BALANCES
Total assets $52,913,823 $50,941,152
Total interest-earning assets 46,853,435 45,106,413
Securities 5,341,287 5,188,980
Net loans and leases 39,452,309 38,450,974
Goodwill 2,009,477 2,009,022
Core deposit and other intangibles 146,363 162,679
Total deposits 36,594,674 36,381,125
Minority interest 30,676 32,343
Shareholders' equity:
Preferred equity 240,000 240,000
Common equity 5,126,621 5,094,138
Weighted average common and
common-equivalent shares
outstanding 106,722,000 106,902,983
AT PERIOD END
Total assets $53,408,293 $52,947,414
Total interest-earning assets 46,962,949 46,448,887
Securities 5,002,207 5,860,900
Net loans and leases 39,905,755 39,087,779
Allowance for loan losses 501,283 459,376
Reserve for unfunded lending
commitments 25,148 21,530
Goodwill 2,009,517 2,009,513
Core deposit and other intangibles 140,672 149,493
Total deposits 37,516,337 36,922,753
Minority interest 30,413 30,939
Shareholders' equity:
Preferred equity 240,000 240,000
Common equity 5,087,801 5,052,800
Common shares outstanding 107,139,188 107,116,505
Average equity to average assets 10.14% 10.47%
Common dividend payout 44.11% 108.88%
Tangible equity ratio 6.20% 6.17%
Tangible common equity ratio 5.73% 5.70%
Nonperforming assets $434,293 $283,854
Accruing loans past due 90 days or
more 84,637 77,419
Nonperforming assets to net loans
and leases and other real estate
owned at period end 1.09% 0.73%
ZIONS BANCORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands, except share December 31, September 30, June 30,
amounts) 2008 2008 2008
------------ ------------- -----------
(Unaudited) (Unaudited) (Unaudited)
ASSETS
Cash and due from banks $1,475,976 $1,441,957 $1,751,724
Money market
investments:
Interest-bearing deposits
and commercial paper 2,332,759 568,875 504,314
Federal funds sold 83,451 274,129 274,456
Security resell
agreements 286,707 170,009 484,487
Investment securities:
Held-to-maturity, at
adjusted cost
(approximate fair value
$1,443,555, $1,587,006,
$1,730,104, $704,156 and
$702,148) 1,790,989 1,917,354 1,914,833
Available-for-sale, at
fair value 2,676,255 2,792,236 2,817,682
Trading account, at
fair value (includes
$538, $531, $463,
$0 and $741
transferred as
collateral
under repurchase
agreements) 42,064 45,769 51,670
----------- ----------- -----------
4,509,308 4,755,359 4,784,185
Loans:
Loans held for sale 200,318 152,095 158,509
Loans and leases 41,791,237 41,876,371 41,874,224
----------- ----------- -----------
41,991,555 42,028,466 42,032,733
Less:
Unearned income and
fees, net of related costs 132,499 140,773 159,756
Allowance for loan
losses 686,999 609,433 548,958
----------- ----------- -----------
Loans and leases, net of
allowance 41,172,057 41,278,260 41,324,019
Other noninterest-
bearing investments 1,044,092 1,170,367 1,153,933
Premises and equipment, net 687,096 675,480 656,013
Goodwill 1,651,377 2,009,504 2,009,511
Core deposit and other
intangibles 125,935 133,989 132,481
Other real estate owned 191,792 156,817 125,186
Other assets 1,532,241 1,339,422 1,430,574
----------- ----------- -----------
$55,092,791 $53,974,168 $54,630,883
=========== =========== ===========
LIABILITIES AND
SHAREHOLDERS' EQUITY
Deposits:
Noninterest-bearing
demand $9,683,385 $9,413,484 $9,735,265
Interest-bearing:
Savings and NOW 4,452,919 4,341,873 4,590,767
Money market 16,826,846 14,087,288 13,387,401
Time under $100,000 2,974,484 2,954,116 2,466,082
Time $100,000 and over 4,756,300 4,468,225 4,102,369
Foreign 2,622,562 3,325,915 3,326,111
----------- ----------- -----------
41,316,496 38,590,901 37,607,995
Securities sold, not yet
purchased 35,657 29,528 46,376
Federal funds purchased 965,835 1,179,197 2,379,055
Security repurchase
agreements 899,751 734,379 1,010,325
Other liabilities 669,111 649,672 555,812
Commercial paper 15,451 40,493 137,200
Federal Home Loan Bank
advances and other
borrowings:
One year or less 2,039,914 4,690,784 5,003,057
Over one year 128,253 128,855 129,474
Long-term debt 2,493,307 2,334,044 2,462,531
----------- ----------- -----------
Total liabilities 48,563,775 48,377,853 49,331,825
----------- ----------- -----------
Minority interest 27,320 30,288 25,528
Shareholders' equity:
Preferred stock, without
par value, authorized
3,000,000 shares:
U.S. Treasury 1,294,885 - -
Other 286,949 286,949 240,000
Common stock, without
par value; authorized
350,000,000 shares;
issued and outstanding
115,344,813, 115,302,598,
107,518,975, 107,139,188
and 107,116,505 shares 2,599,916 2,482,517 2,224,455
Retained earnings 2,433,363 2,968,242 2,981,062
Accumulated other
comprehensive income
(loss) (98,958) (157,305) (158,325)
Deferred compensation (14,459) (14,376) (13,662)
----------- ----------- -----------
Total shareholders'
equity 6,501,696 5,566,027 5,273,530
----------- ----------- -----------
$55,092,791 $53,974,168 $54,630,883
=========== =========== ===========
ZIONS BANCORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
March 31, December 31,
(In thousands, except share amounts) 2008 2007
----------- ------------
(Unaudited)
ASSETS
Cash and due from banks $1,660,539 $1,855,155
Money market investments:
Interest-bearing deposits and
commercial paper 1,243,860 726,446
Federal funds sold 121,892 102,225
Security resell agreements 689,235 671,537
Investment securities:
Held-to-maturity, at adjusted cost
(approximate fair value
$1,443,555, $1,587,006, $1,730,104,
$704,156 and $702,148) 701,658 704,441
Available-for-sale, at fair value 4,259,742 5,134,610
Trading account, at fair value
(includes $538, $531, $463,
$0 and $741 transferred as collateral
under repurchase agreements) 40,807 21,849
----------- -----------
5,002,207 5,860,900
Loans:
Loans held for sale 208,529 207,943
Loans and leases 39,855,365 39,044,163
----------- -----------
40,063,894 39,252,106
Less:
Unearned income and fees, net of
related costs 158,139 164,327
Allowance for loan losses 501,283 459,376
----------- -----------
Loans and leases, net of allowance 39,404,472 38,628,403
Other noninterest-bearing investments 1,114,902 1,034,412
Premises and equipment, net 657,183 655,712
Goodwill 2,009,517 2,009,513
Core deposit and other intangibles 140,672 149,493
Other real estate owned 36,476 15,201
Other assets 1,327,338 1,238,417
----------- -----------
$53,408,293 $52,947,414
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits:
Noninterest-bearing demand $9,464,122 $9,618,300
Interest-bearing:
Savings and NOW 4,661,963 4,507,837
Money market 12,986,387 12,467,239
Time under $100,000 2,564,434 2,562,363
Time $100,000 and over 4,548,009 4,391,588
Foreign 3,291,422 3,375,426
----------- -----------
37,516,337 36,922,753
Securities sold, not yet purchased 184,522 224,269
Federal funds purchased 1,817,587 2,463,460
Security repurchase agreements 1,144,178 1,298,112
Other liabilities 620,528 644,375
Commercial paper 164,657 297,850
Federal Home Loan Bank advances and other
borrowings:
One year or less 3,956,775 3,181,990
Over one year 127,006 127,612
Long-term debt 2,518,489 2,463,254
----------- -----------
Total liabilities 48,050,079 47,623,675
----------- -----------
Minority interest 30,413 30,939
Shareholders' equity:
Preferred stock, without par value,
authorized 3,000,000 shares:
U.S. Treasury - -
Other 240,000 240,000
Common stock, without par value;
authorized 350,000,000 shares;
issued and outstanding 115,344,813,
115,302,598, 107,518,975, 107,139,188
and 107,116,505 shares 2,219,905 2,212,237
Retained earnings 2,957,511 2,910,692
Accumulated other comprehensive income
(loss) (76,429) (58,835)
Deferred compensation (13,186) (11,294)
----------- -----------
Total shareholders' equity 5,327,801 5,292,800
----------- -----------
$53,408,293 $52,947,414
=========== ===========
ZIONS BANCORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
Three Months Ended
(In thousands, --------------------------------------------------
except per Dec. 31, Sept. 30, June 30, March 31, Dec. 31,
share amounts) 2008 2008 2008 2008 2007
-------- --------- -------- -------- ---------
Interest
income:
Interest and
fees on loans $650,885 $663,677 $643,111 $688,439 $727,185
Interest on
loans held for sale 2,442 1,916 2,699 3,017 2,975
Lease financing 4,999 5,515 5,767 5,818 5,782
Interest on
money market
investments 7,172 9,267 12,313 19,028 18,760
Interest on
securities:
Held-to-
maturity - taxable 22,317 21,780 15,730 2,455 2,387
Held-to-
maturity -
nontaxable 6,396 6,319 6,224 6,429 6,430
Available-
for-sale -
taxable 28,680 25,044 35,059 62,356 61,459
Available-for-
sale - nontaxable 1,711 1,697 1,870 1,892 2,070
Trading account 598 437 159 681 471
--------- ------- ------- ------- -------
Total interest
income 725,200 735,652 722,932 790,115 827,519
--------- ------- ------- ------- -------
Interest
expense:
Interest on
savings and
money market
deposits 95,717 90,720 80,144 103,987 125,382
Interest on
time and
foreign deposits 77,806 74,837 83,460 106,222 119,242
Interest on
short-term
borrowings 20,368 50,164 45,070 63,273 67,601
Interest on
long-term
borrowings 22,867 27,928 29,515 30,175 36,409
--------- ------- ------- ------- -------
Total interest
expense 216,758 243,649 238,189 303,657 348,634
--------- ------- ------- ------- -------
Net interest
income 508,442 492,003 484,743 486,458 478,885
Provision for
loan losses 285,189 156,606 114,192 92,282 69,982
--------- ------- ------- ------- -------
Net interest
income after
provision for
loan losses 223,253 335,397 370,551 394,176 408,903
--------- ------- ------- ------- -------
Noninterest
income:
Service charges and
fees on deposit
accounts 52,641 53,695 51,067 49,585 48,130
Other service
charges, commissions
and fees 40,532 42,794 42,362 41,981 44,405
Trust and
wealth
management income 8,910 8,865 10,284 9,693 10,151
Capital
markets and
foreign exchange 15,048 12,257 12,196 10,397 10,632
Dividends and
other
investment income 16,001 7,042 10,409 12,910 13,830
Loan sales and
servicing income 4,420 3,633 8,516 7,810 8,640
Income from
securities conduit 1,542 336 1,043 2,581 2,472
Fair value and
nonhedge
derivative
income (loss) (5,819) (26,155) (19,789) 3,787 (7,034)
Equity
securities gains
(losses), net (14,125) 12,971 (8,121) 10,068 1,349
Fixed income
securities gains
(losses), net (1,139) 135 78 1,775 (753)
Impairment
losses on
investment
securities
and valuation
losses on
securities
purchased
from Lockhart
Funding (204,340) (28,022) (38,761) (45,989) (158,208)
Other 4,039 2,059 3,088 6,402 6,152
--------- ------- ------- ------- -------
Total
noninterest
income (82,290) 89,610 72,372 111,000 (20,234)
--------- ------- ------- ------- -------
Noninterest
expense:
Salaries and
employee
benefits 190,861 208,995 201,291 209,354 191,141
Occupancy, net 29,460 30,552 27,364 26,799 27,312
Furniture and
equipment 26,507 24,281 25,610 23,738 24,917
Other real
estate expense 40,124 7,126 1,290 1,838 1,377
Legal and
professional
services 14,774 11,297 11,566 7,880 12,132
Postage and
supplies 9,873 9,257 8,536 9,789 9,416
Advertising 10,078 6,782 7,520 6,351 6,322
Impairment
losses on
long-lived
assets 895 2,239 - - -
Merger related
expense 636 384 281 307 687
Amortization
of core
deposit and
other
intangibles 8,055 8,096 8,191 8,820 10,459
Provision for
unfunded
lending
commitments (577) (3,264) 1,690 3,618 136
Other 67,481 66,531 61,078 51,609 69,067
--------- ------- ------- ------- -------
Total
noninterest
expense 398,167 372,276 354,417 350,103 352,966
--------- ------- ------- ------- -------
Impairment loss on
goodwill 353,804 - - - -
--------- ------- ------- ------- -------
Income (loss)
before income
taxes and
minority
interest (611,008) 52,731 88,506 155,073 35,703
Income taxes
(benefit) (126,512) 11,214 22,037 49,896 (11,035)
Minority interest (1,520) 3,757 (5,729) (1,572) 1,197
--------- ------- ------- ------- -------
Net income
(loss) (482,976) 37,760 72,198 106,749 45,541
Preferred stock
dividends 15,108 4,409 2,454 2,453 3,343
--------- ------- ------- ------- -------
Net earnings
(loss)
applicable to
common
shareholders $(498,084) $33,351 $69,744 $104,296 $42,198
========= ======= ======= ======== =======
Weighted
average common
shares
outstanding
during the
period:
Basic shares 114,065 108,407 106,595 106,514 106,454
Diluted shares 114,206 108,497 106,712 106,722 106,903
Net earnings
(loss) per
common share:
Basic $(4.37) $0.31 $0.65 $0.98 $0.40
Diluted (4.36) 0.31 0.65 0.98 0.39
ZIONS BANCORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (Continued)
(Unaudited)
Years Ended
(In thousands, except per share amounts) December 31,
----------------------
2008 2007
---------- ----------
Interest income:
Interest and fees on loans $2,646,112 $2,823,382
Interest on loans held for sale 10,074 14,867
Lease financing 22,099 21,683
Interest on money market investments 47,780 43,699
Interest on securities:
Held-to-maturity - taxable 62,282 8,997
Held-to-maturity - nontaxable 25,368 25,150
Available-for-sale - taxable 151,139 255,039
Available-for-sale - nontaxable 7,170 9,200
Trading account 1,875 3,309
--------- ---------
Total interest income 2,973,899 3,205,326
--------- ---------
Interest expense:
Interest on savings and money market
deposits 370,568 479,366
Interest on time and foreign deposits 342,325 472,353
Interest on short-term borrowings 178,875 218,696
Interest on long-term borrowings 110,485 152,959
--------- ---------
Total interest expense 1,002,253 1,323,374
--------- ---------
Net interest income 1,971,646 1,881,952
Provision for loan losses 648,269 152,210
--------- ---------
Net interest income after provision for
loan losses 1,323,377 1,729,742
--------- ---------
Noninterest income:
Service charges and fees on deposit
accounts 206,988 183,550
Other service charges, commissions and fees 167,669 170,564
Trust and wealth management income 37,752 36,532
Capital markets and foreign exchange 49,898 43,588
Dividends and other investment income 46,362 50,914
Loan sales and servicing income 24,379 38,503
Income from securities conduit 5,502 18,176
Fair value and nonhedge derivative loss (47,976) (14,256)
Equity securities gains, net 793 17,719
Fixed income securities gains, net 849 3,019
Impairment losses on investment
securities and valuation
losses on securities purchased from Lockhart
Funding (317,112) (158,208)
Other 15,588 22,243
--------- ---------
Total noninterest income 190,692 412,344
--------- ---------
Noninterest expense:
Salaries and employee benefits 810,501 799,884
Occupancy, net 114,175 107,438
Furniture and equipment 100,136 96,452
Other real estate expense 50,378 4,391
Legal and professional services 45,517 43,829
Postage and supplies 37,455 36,512
Advertising 30,731 26,920
Impairment losses on long-lived assets 3,134 -
Merger related expense 1,608 5,266
Amortization of core deposit and other
intangibles 33,162 44,895
Provision for unfunded lending commitments 1,467 1,836
Other 246,699 237,165
--------- ---------
Total noninterest expense 1,474,963 1,404,588
--------- ---------
Impairment loss on goodwill 353,804 -
--------- ---------
Income (loss) before income taxes and
minority interest (314,698) 737,498
Income taxes (benefit) (43,365) 235,737
Minority interest (5,064) 8,016
--------- ---------
Net income (loss) (266,269) 493,745
Preferred stock dividends 24,424 14,323
--------- ---------
Net earnings (loss) applicable to common
shareholders $(290,693) $479,422
========= =========
Weighted average common shares outstanding
during the period:
Basic shares 108,908 107,365
Diluted shares 109,145 108,523
Net earnings (loss) per common share:
Basic $(2.67) $4.47
Diluted (2.66) 4.42
ZIONS BANCORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
AND COMPREHENSIVE INCOME
(Unaudited)
(In thousands, except per Preferred Common Retained
share amounts) stock stock earnings
--------- ---------- ----------
Balance, December 31, 2007 $240,000 $2,212,237 $2,910,692
Cumulative effect of
change in accounting
principle, adoption of
SFAS 159 (11,471)
Comprehensive income:
Net income for the period 106,749
Other comprehensive
income (loss), net of
tax:
Net realized and
unrealized holding
losses
on investments and
retained interests
Foreign currency
translation
Reclassification for net
realized losses
on investments
recorded in operations
Net unrealized gains on
derivative instruments
Other comprehensive loss
Total comprehensive
income
Net stock issued under
employee plans and related
tax benefits 7,668
Dividends declared on
preferred stock (2,453)
Dividends on common stock,
$.43 per share (46,006)
Change in deferred
compensation
---------- ---------- ----------
Balance, March 31, 2008 240,000 2,219,905 2,957,511
Comprehensive loss:
Net income for the period 72,198
Other comprehensive
income (loss), net of
tax:
Net realized and
unrealized holding
losses on investments and
retained interests
Foreign currency
translation
Reclassification for net
realized losses
on investments
recorded in operations
Net unrealized losses on
derivative instruments
Pension and postretirement Other comprehensive loss
Total comprehensive loss
Stock issued under
dividend reinvestment
plan 632
Net stock issued under
employee plans and related
tax benefits 3,918
Dividends declared on
preferred stock (2,454)
Dividends on common stock,
$.43 per share (46,193)
Change in deferred
compensation
---------- ---------- ----------
Balance, June 30, 2008 240,000 2,224,455 2,981,062
Comprehensive income:
Net income for the period 37,760
Other comprehensive
income (loss), net of
tax:
