Zions Triples Earnings, Increases Loans 3%

Zions Bancorp. (ZION) more than tripled quarterly profits as it recorded a credit for its loan-loss provision and lowered its interest expenses.

The Salt Lake City company reported first-quarter earnings of $88.3 million, while its earnings per share of 48 cents beat analysts' expectations by nine cents.

"We are again pleased with our improvement in credit quality, which we expect to continue, and by somewhat better loan growth over the past couple of quarters, but we see some renewed signs of new loan pricing pressure," Harris H. Simmons, chairman and chief executive officer, said in a news release.

"However, we do expect continued bottom line improvement as we take numerous actions over the next several quarters to reduce the cost of our capital and debt financing," Simmons said.

Gross loan and lease chargeoffs declined 56%, to $35.5 million, from a year earlier with improvements in the commercial, consumer and commercial real estate portfolios. Provision for loan losses was a credit of $29 million, compared with a loss of $15.7 million a year earlier.

The $53.9 billion-asset company's total interest expenses fell 18%, to $66.6 million, from a year earlier. Noninterest expenses rose about 1%, to $397.3 million, primarily from increases in salaries and employee benefits.

Interest and fees on loans fell almost 6%, to $453.4 million, year over year, while net interest income totaled $418.1 million, down 4% from a year earlier. Total loans were $37.8 billion, up almost 3% from a year earlier. Its net interest margin fell to 3.44% from 3.47% a year earlier.

Noninterest income rose more than 8%, to $121.2 million, as fee income increased from capital markets and foreign exchange, dividends and other investments and loan sales and servicing.