Zions Bancorp reports Q3 EPS $1.48, consensus $1.40

Reports Q3 NIM 3.28% vs. 3.03% last year. Tangible book value per common share increased $5.52, or 17%, to $38.64. CEO Harris Simmons commented, “We’re pleased with the company’s core earnings, which included 14% growth in pre-provision net revenue over the prior year period, and 18% on an adjusted basis. The net interest margin increased 25 basis points over the prior year period, while customer-related noninterest income, adjusted for the net credit valuation adjustment, grew 8%. Although loans contracted at a 3% annualized linked-quarter rate in the quarter, deposits, excluding brokered deposits, grew at an annualized rate of 7%. Over the past year, tangible book value per share grew 17%. The quarter’s credit results were marred by a $50M charge-off, and a $10M specific reserve established against the approximate remaining balance, arising from loans to two related companies in which apparent irregularities and misrepresentations were recently detected. Legal action has been initiated to pursue recovery of the amounts owed from guarantors of the credits. Excluding this loss, remaining net charge-offs were very benign at $6M, or 4 basis points of average loans on an annualized basis.”