Zions Bancorp and First Security Corp. face more than the usual hurdles as the two Salt Lake City banking companies try to merge.

An antitrust suit filed last year claims that if combined, the market share of the two large banks - both of which have longstanding ties to the Church of Jesus Christ of Latter-day Saints and, therefore an inside track with the extensive Mormon customer base - would be too great to maintain a competitive banking environment in Utah.

Then came First Security Corp.'s announcement Friday that revenue projections for the first quarter would be 8% lower than in the previous quarter, causing the bank's stock to plummet and prompting investors to question whether Zions should proceed with merger plans.

George Allen of Provo, Utah, who is the lawyer representing the plaintiffs, was scheduled to file a motion Tuesday stating that because of First Security's announcement last week, the cost savings projected by the bank from the combination of the two banks are invalid.

Officers of Zions and First Security declined to discuss the case.

The Utah residents' case may expire within the week, despite this new turn of events; the suit and Zions' response motion to dismiss the case goes before a federal magistrate judge this Friday, and the Federal Reserve Board has already approved the merger.

However, the locals' concerns persist.

"Zions and First Security are the two largest banks which have Mormon roots," said Richard Valgardson, a member of the church who owns Valgardson Transport Co. and Irontown Housing Corp., both in Provo. "If they combine, and for some reason you don't like the banker, or vice versa, you have a problem."

Staff at First Security and Zions understand "the kind of ways things are done" in Utah and among followers of the LDS Church; that understanding is not typically shared by staff at a rival out-of-state bank, Mr. Valgardson said.

"The field has already been plowed before you sit down," when dealing with an employee of one of the two banks, he said, adding this preference does not mean he won't do business with someone from outside his religion.

Zions was started by Brigham Young, who brought the LDS Church to Utah, in 1873 as Zion's Savings Bank and Trust Co. One of the original banks to become part of the First Security bank holding company was Deseret National Bank, also founded by Mr. Young, in 1871.

Dean May, a professor of Utah and western history at University of Utah, said: "From the time when this was an undeveloped state and the Mormon church was instrumental in that development, the distinction between secular and religious lives was somewhat eroded, and you can still see some residual of that."

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