<PAGE> 1
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
/ X / QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1994
-------------
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from __________________ to ___________________
COMMISSION FILE NUMBER 0-2610
ZIONS BANCORPORATION
------------------------------------------------------
(Exact name of Registrant as specified in its charter)
<TABLE>
<S> <C>
UTAH 87-0227400
------------- ------------------
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
1380 KENNECOTT BUILDING
SALT LAKE CITY, UTAH 84133
-------------------------- -----------
(Address of principal executive offices) (Zip Code)
</TABLE>
Registrant's telephone number, including area code: (801) 524-4787
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months and (2) has been subject to such filing
requirement for the past 90 days. Yes / X / No / /
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
<TABLE>
<S> <C>
Common Stock, without par value, outstanding at August 5, 1994 14,554,683 shares
</TABLE>
1
<PAGE> 2
ZIONS BANCORPORATION AND SUBSIDIARIES
INDEX
<TABLE>
<CAPTION>
Page
----
<S> <C>
PART I. FINANCIAL INFORMATION
---------------------
ITEM 1. Financial Statements (unaudited)
Consolidated Balance Sheets 3
Consolidated Statements of Income 5
Consolidated Statements of Cash Flows 6
Consolidated Statements of Retained Earnings 7
Notes to Consolidated Financial Statements 8
ITEM 2. Management's Discussion and Analysis 9
PART II. OTHER INFORMATION
-----------------
ITEM 4. Submission of Matters to a Vote of Shareholders 22
ITEM 6. Exhibits and Reports on Form 8-K 23
SIGNATURES 23
- - ----------
</TABLE>
2
<PAGE> 3
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
ZIONS BANCORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
<TABLE>
<CAPTION>
June 30, December 31,
(In thousands) 1994 1993
---------- ----------
<S> <C> <C>
Assets
Cash and due from banks $ 265,917 $ 338,970
Money market investments:
Interest-bearing deposits 24,323 24,967
Federal funds sold and security resell agreements 805,965 572,713
Investments:
Held to maturity at cost (approximate
market value $897,210 and $830,087):
Taxable 706,981 617,019
Nontaxable 191,094 196,241
Available for sale at market 340,365 347,346
Trading account securities at market 313,816 98,333
--------- ----------
1,552,256 1,258,939
Loans:
Loans held for sale at cost, which approximates market 190,198 238,206
Loans, leases and other receivables 2,494,550 2,269,970
--------- ---------
2,684,748 2,508,176
Less:
Unearned income and fees, net of related costs 19,644 21,830
Allowance for loan losses 68,981 68,461
---------- ----------
2,596,123 2,417,885
Premises and equipment, at cost, less accumulated depreciation 73,779 72,049
Amounts paid in excess of net assets of acquired businesses 19,351 11,920
Other real estate owned 1,748 3,267
Other assets 112,985 100,344
--------- ---------
Total assets $5,452,447 $4,801,054
========= =========
</TABLE>
3
<PAGE> 4
ZIONS BANCORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (Continued)
(Unaudited)
<TABLE>
<CAPTION>
June 30, December 31,
(In thousands) 1994 1993
----------- ------------
<S> <C> <C>
Liabilities and Shareholders' Equity
Deposits:
Noninterest-bearing demand $ 845,983 $ 879,908
Interest-bearing:
Savings and money market 2,048,889 1,867,483
Time under $100,000 518,856 535,456
Time over $100,000 109,294 80,879
Foreign 76,154 68,563
--------- ---------
3,599,176 3,432,289
Securities sold, not yet purchased 96,810 46,640
Federal funds purchased and security repurchase agreements 1,160,933 595,200
Accrued liabilities 62,037 66,497
Federal Home Loan Bank advances and other borrowings:
Less than one year 27,145 136,140
Over one year 105,421 152,109
Long-term debt:
Subordinated notes 54,000 54,000
Industrial revenue bonds 1,550 1,550
Other long-term debt 3,557 4,037
--------- ---------
Total liabilities 5,110,629 4,488,462
--------- ---------
Shareholders' equity:
Capital stock:
Preferred stock, without par value; authorized 3,000,000 shares;
issued and outstanding, none -- --
Common stock, without par value; authorized 30,000,000
shares; issued and outstanding, 14,546,211
and 14,201,367 shares 79,027 66,257
Net unrealized holding gains and losses on securities available for sale (3,434) 415
Retained earnings 266,225 245,920
--------- ---------
Total shareholders' equity 341,818 312,592
--------- ---------
Total liabilities and shareholders' equity $5,452,447 $4,801,054
========= =========
</TABLE>
4
<PAGE> 5
ZIONS BANCORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
---------------------- --------------------
(In thousands) 1994 1993 1994 1993
---- ---- ---- ----
<S> <C> <C> <C> <C>
Interest income:
Interest and fees on loans $50,672 $42,951 $ 96,548 $ 83,576
Interest on loans held for sale 3,139 2,997 6,398 5,996
Interest on money market investments 9,143 4,767 16,807 9,990
Interest on securities:
Held to maturity:
Taxable 9,308 14,801 17,460 28,116
Nontaxable 2,910 2,043 5,346 3,923
Available for sale 5,038 -- 9,879 --
Trading account 4,151 1,136 6,628 2,188
Lease financing 2,411 2,396 4,919 4,893
------ ------ ------- -------
Total interest income 86,772 71,091 163,985 138,682
------ ------ ------- -------
Interest expense:
Interest on savings and money market deposits 14,776 12,289 27,792 24,405
Interest on time deposits under $100,000 4,934 6,000 10,049 12,555
Interest on time deposits over $100,000 968 768 1,728 1,478
Interest on foreign deposits 1,059 315 1,613 656
Interest on securities sold, not yet purchased 2,741 -- 3,640 --
Interest on borrowed funds 13,553 6,906 25,621 13,683
------ ------ ------- -------
Total interest expense 38,031 26,278 70,443 52,777
------ ------ ------- -------
Net interest income 48,741 44,813 93,542 85,905
Provision for loan losses 467 408 757 1,773
------- ------- -------- -------
Net interest income after provision for loan losses 48,274 44,405 92,785 84,132
------ ------ ------- -------
Other operating income:
Service charges on deposit accounts 5,699 6,007 11,650 11,620
Other service charges, commissions and fees 5,880 5,034 11,081 9,401
Trust income 1,184 1,246 2,276 2,368
Investment securities gains (losses), net (165) (28) (334) (25)
Trading account income (loss) 705 551 395 978
Loan sales and servicing income 3,802 4,038 7,298 6,978
Other income 1,360 2,523 2,495 3,817
------ ------ ------- -------
Total other operating income 18,465 19,371 34,861 35,137
------ ------ ------- -------
Other operating expenses:
Salaries and employee benefits 22,828 20,702 45,781 39,613
Occupancy, net 1,980 1,865 4,103 3,822
Furniture and equipment expense 3,131 2,181 5,797 4,266
Other real estate expense (89) (197) 51 (59)
Legal and professional services 220 1,442 2,207 2,416
Supplies 1,145 985 2,422 2,218
Postage 1,099 1,038 2,288 2,054
FDIC premiums 1,853 1,854 3,674 3,709
Amortization of intangible assets 768 1,212 1,659 2,158
Loss on early extinguishment of debt -- -- -- 6,022
Other expenses 9,061 7,965 16,505 14,893
------ ------ ------- -------
Total other operating expenses 41,996 39,047 84,487 81,112
------ ------ ------- -------
Income before income taxes and cumulative effect
of changes in accounting principles 24,743 24,729 43,159 38,157
Income taxes 8,325 8,093 14,303 12,434
------ ------ ------- -------
Net income before cumulative effect of changes in accounting principles 16,418 16,636 28,856 25,723
Cumulative effect of changes in accounting principles -- -- -- 1,659
-------- -------- --------- --------
Net income $16,418 $16,636 $ 28,856 $ 27,382
====== ====== ======= =======
Weighted average common and common equivalent shares outstanding 14,843 14,230 14,497 14,319
Earnings per common share:
Income before cumulative effect of changes in accounting principles $1.11 $1.17 $1.99 $1.80
Cumulative effect of changes in accounting principles -- -- -- .12
----- ----- ----- ----
Net income per common share $1.11 $1.17 $1.99 $1.92
==== ==== ==== ====
</TABLE>
5
<PAGE> 6
ZIONS BANCORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
----------------- --------------------
(In thousands) 1994 1993 1994 1993
---- ---- ---- ----
<S> <C> <C> <C> <C>
Cash flows from operating activities:
Net income $ 16,418 $ 16,636 $ 28,856 $ 27,382
Adjustments to reconcile net income to net cash
provided by operating activities:
Provision for loan losses 467 408 757 1,773
Write-downs of other real estate owned 79 14 164 69
Depreciation of premises and equipment 2,135 1,804 4,245 3,548
Amortization of premium on core deposits and
other intangibles 768 1,212 1,659 2,158
Amortization of net premium/discount on
investment securities 1,187 1,648 2,779 2,881
Accretion of unearned income and fees, net of
related costs (1,441) 123 (2,360) (753)
Proceeds from sales of trading account securities 25,641,744 1,185,265 45,966,991 1,957,411
Increase in trading account securities (25,524,959) (1,168,222) (46,182,474) (1,947,475)
Net loss on sales of investment securities 165 28 334 25
Proceeds from loans held for sale 194,938 394,053 437,741 618,583
Increase in loans held for sale (175,210) (458,307) (386,640) (595,349)
Net gain on sales of loans, leases and other assets (1,903) (2,872) (3,414) (4,767)
Net gain on sales of other real estate owned (14) (57) (25) (64)
Change in accrued income taxes (4,946) (3,180) (47) 1,215
Change in accrued interest receivable (1,262) 2,938 (3,902) 3,670
Change in other assets 1,402 (8,874) (3,799) (14,585)
Change in accrued interest payable (2,622) (478) (42) (434)
Change in accrued liabilities 318 (4,197) (5,732) 3,389
----------- ---------- ------------ ----------
Net cash provided by (used in) operating activities 147,264 (42,058) (144,909) 58,677
----------- ---------- ------------ ----------
Cash flows from investing activities:
Net (increase) decrease in money market investments (151,311) 137,505 (230,756) 29,911
Proceeds from sales of investment securities held to maturity -- 2,203 -- 2,266
Proceeds from maturities of investment securities
held to maturity 44,704 74,547 67,853 124,845
Purchases of investment securities held to maturity (54,340) (135,672) (130,826) (341,231)
Proceeds from sales of investment securities available
for sale 13,601 -- 80,933 --
Proceeds from maturities of investment securities
available for sale 16,309 -- 86,832 --
Purchases of investment securities available for sale (25,802) -- (149,463) --
Proceeds from sales of loans and leases -- 195,826 -- 197,636
Net increase in loans and leases (97,480) (202,620) (173,461) (250,064)
Principal collections on leveraged leases -- 122 -- 309
Proceeds from sales of premises and equipment 160 28 424 95
Purchases or premises and equipment (2,629) (4,558) (5,813) (7,790)
Proceeds from sales of other real estate owned 903 (19) 2,860 1,081
Proceeds from sales of mortgage servicing rights 23 72 34 521
Purchases of mortgage servicing rights (199) (529) (423) (684)
Proceeds from sales of other assets 157 234 249 243
Cash paid for acquisitions, net of cash received 9,852 -- 9,851 4,451
----------- ---------- ----------- -----------
Net cash provided by (used in) investing activities (246,052) 67,139 (441,706) (238,411)
----------- ---------- ----------- -----------
</TABLE>
6
<PAGE> 7
ZIONS BANCORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
------------------------- --------------------
(In thousands) 1994 1993 1994 1993
---- ---- ---- ----
<S> <C> <C> <C> <C>
Cash flows from financing activities:
Net increase in deposits $ 9,903 $ 195,538 $ 71,116 $ 211,770
Net change in short-term funds borrowed 137,915 (187,316) 497,888 (65,157)
Proceeds from FHLB advances over one year 4,300 103,000 11,108 104,723
Payments on FHLB advances over one year (53,965) (121) (57,796) (187)
Proceeds from issuance of long-term debt -- 4,000 -- 4,000
Payments on long-term debt (243) (42,403) (480) (42,615)
Proceeds from issuance of common stock 152 205 277 481
Dividends paid (4,081) (2,591) (8,551) (5,661)
----------- ---------- ------------ ------------
Net cash provided by financing activities 93,981 70,312 513,562 207,354
---------- --------- ------------ -----------
Net increase (decrease) in cash and due from banks (4,807) 95,393 (73,053) 27,620
Cash and due from banks at beginning of period 270,724 256,159 338,970 323,932
---------- --------- ------------ -----------
Cash and due from banks at end of period $ 265,917 $ 351,552 $ 265,917 $ 351,552
=========== ========= ============ ===========
</TABLE>
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
----------------------- ---------------------
(In thousands) 1994 1993 1994 1993
---- ---- ---- ----
<S> <C> <C> <C> <C>
Cash paid for:
Interest $41,028 $27,294 $71,294 $53,636
Income taxes 12,016 12,337 12,601 13,259
Loans transferred to other real estate owned 703 - 1,408 780
</TABLE>
ZIONS BANCORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF RETAINED EARNINGS
(Unaudited)
<TABLE>
<CAPTION>
Six Months Ended Twelve Months Ended
June 30, December 31,
--------------------- ------------------
(In thousands) 1994 1993 1993
---- ---- ----
<S> <C> <C> <C>
Balance at beginning of period $245,920 $197,992 $197,992
Add:
Net income 28,856 27,382 58,205
Retained earnings of company acquired -- 2,428 2,428
------- ------- -------
274,776 227,802 258,625
Deduct cash dividends:
Preferred paid to minority shareholder
of subsidiary 15 -- 13
Common, per share $ .28 in 1994 and
$ .21 and $ .98 in 1993 8,051 5,176 12,207
Common dividend of NBA prior to merger 485 485 485
------- ------- -------
Balance at end of period $266,225 $222,141 $245,920
======= ======= =======
</TABLE>
7
<PAGE> 8
ZIONS BANCORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Basis of Presentation
The unaudited consolidated financial statements have been prepared in
accordance with generally accepted accounting principles for interim financial
information and with the instructions to Form 10-Q and Rule 10-01 of Regulation
S-X.
Accordingly, they do not include all of the information and footnotes required
by generally accepted accounting principles for complete financial statements.
In the opinion of management, all adjustments (consisting of normal recurring
accruals) considered necessary for a fair presentation have been included. The
consolidated financial statements give effect to the merger of Zions
Bancorporation and National Bancorp of Arizona Inc. (NBA) on January 14, 1994,
which has been accounted for as a pooling of interests, and amounts in the 1993
consolidated financial statements have been restated to give effect to this
merger. Operating results for the six months ended June 30, 1994 are not
necessarily indicative of the results that may be expected for the year ended
December 31, 1994. For further information, refer to the consolidated
financial statements and footnotes thereto included in Zions Bancorporation's
Annual Report to Shareholders on Form 10-K for the year ended December 31,
1993.
8
<PAGE> 9
ZIONS BANCORPORATION AND SUBSIDIARIES
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
---------------------------- -------------------------
(In thousands, except per share and ratio data) 1994 1993 % Change 1994 1993 % Change
---- ---- -------- ---- ---- --------
<S> <C> <C> <C> <C> <C> <C>
EARNINGS:
Net income before cumulative effect
of changes in accounting principles $16,418 $16,636 -1.3 $28,856 $25,723 12.2
Net income 16,418 16,636 -1.3 28,856 27,382 5.4
PER COMMON SHARE:
Net income before cumulative effect
of changes in accounting principles $ 1.11 $ 1.17 -5.1 $ 1.99 $ 1.80 10.6
Net income 1.11 1.17 -5.1 1.99 1.92 3.6
Dividends .28 .21 33.3 .56 .42 33.3
Book value at June 30 23.50 20.39 15.3
Market value at June 30 39.75 40.00 -.6
(In thousands)
Weighted average common and common
equivalent shares outstanding 14,843 14,230 14,497 14,319
Common shares outstanding at June 30 14,546 14,122
PERFORMANCE RATIOS:
Net interest margin 3.92% 4.68% 3.86% 4.63%
Return on average assets 1.18% 1.55% 1.07% 1.32%
Return on average common equity 19.4% 23.5% 17.8% 19.9%
Dividend payout ratio 24.9% 15.6% 29.6% 20.7%
Nonperforming assets to loans, leases
and other real estate owned and other
nonperforming assets at June 30 .81% 1.52%
CAPITAL RATIOS:
Average equity to average assets 6.07% 6.60% 6.00% 6.61%
Tier I Leverage at June 30 5.62% 6.33%
Tier I risk-based capital at June 30 10.61% 11.01%
Total risk-based capital at June 30 13.69% 14.47%
</TABLE>
9
<PAGE> 10
ZIONS BANCORPORATION AND SUBSIDIARIES
OPERATING RESULTS
Consolidated net income for the second quarter of 1994 was $16,418,000 or $1.11
per share compared to $16,636,000 or $1.17 per share for the second quarter of
1993 and $12,438,000 or $.88 per share for the first quarter of 1994.
Consolidated net income was $28,856,000 or $1.99 per share for the first six
months of 1994, compared to $27,382,000 or $1.92 per share for the first six
months of 1993, which constituted increases of 5.4% and 3.6%, respectively.
Earnings results for the first six months of 1993 were positively affected in
the net amount of $1,659,000 or $.12 per share due to the cumulative effect of
changes in accounting principles implemented during the first quarter of 1993.
The Company's earnings for the six months ended June 30, 1993, however, were
also negatively affected by a one-time expense of $6,022,000 included in other
operating expenses related to early extinguishment of certain long-term debt.
Amounts in the 1993 consolidated financial statements have been restated to
give effect to the merger of Zions Bancorporation and National Bancorp of
Arizona, on January 14, 1994, which has been accounted for as a pooling of
interests.
The Company's second-quarter $218,000 decrease in earnings relative to the same
period a year ago reflect a $3,928,000 (8.8%) increase in net interest income,
a $59,000 (14.5%) increase in the provision for loan losses, a $906,000 (4.7%)
decrease in other operating income, a $2,949,000 (7.6%) increase in other
operating expenses and a $232,000 (2.9%) increase in income tax expense.
The $643,000 decrease in net income for the six-month period ended June 30,
1994, compared to the similar period in 1993 (excluding the aforementioned
expense relating to the early extinguishment of debt and the net benefit
resulting from the cumulative effect of changes in accounting principles),
reflect a $7,637,000 (8.9%) increase in net interest income, a $1,016,000
(57.3%) decrease in the provision for loan losses, a $276,000 (.8%) decrease in
other operating income, a $9,397,000 (12.5%) increase in other operating
expenses and a $377,000 (2.6%) decrease in income tax expense.
The annualized return on average assets for the second quarter and for the
first six months of 1994 was 1.18% and 1.07%, respectively, resulting in an
annualized return on average common shareholders' equity for the same periods
of 19.4% and 17.8%.
10
<PAGE> 11
ZIONS BANCORPORATION AND SUBSIDIARIES
NET INTEREST INCOME AND INTEREST RATE SPREADS
Net interest income for the second quarter of 1994, adjusted to a fully
taxable-equivalent basis, increased 9.2% from the second quarter of 1993, and
increased 9.0% from the first quarter of 1994. Net interest margin was 3.92%,
compared to 4.68% for the second quarter of 1993, and 3.79% for the first
quarter of 1994. Six-month net interest income, on a fully taxable-equivalent
basis, was $95,833,000 in 1994, an increase of 9.2% compared to the first six
months of 1993. Net interest margin for the first six months of 1994 was
3.86%, compared to 4.63% for the first six months of 1993.
The yield on average earning assets decreased 45 basis points during the second
quarter of 1994 as compared to the second quarter of 1993, but increased 44
basis points from the first quarter of 1994. The average rate paid this
quarter on interest-bearing funds increased 29 basis points from the second
quarter of 1993, and increased 38 basis points from the first quarter of 1994.
Comparing the first six months of 1994 with 1993, the yield on average earning
assets decreased 73 basis points, while the cost of interest-bearing funds
increased by 1 basis point.
The spread on average interest-bearing funds for the second quarter of 1994 was
3.36%, down from the 4.10% for the second quarter of 1993 but up from the 3.30%
for the first quarter of 1994. The spread on average interest-bearing funds
for the first six months of 1994 was 3.32% compared with 4.06% for the same
period in 1993,
The Company attempts to minimize interest rate movement sensitivity through the
management of interest rate maturities and the use of off-balance sheet
arrangements such as caps, floors and interest rate exchange contract
agreements. Net interest income to the Company from the use of such
off-balance sheet arrangements for the first six months of 1994 was $18,000
compared to $500,000 for the first six months of 1993. Net interest margin is
also affected by the Company's maintenance of a strong liquidity position.
The increased level of taxable-equivalent net interest income in the first six
months of 1994, compared to the same period in 1993, was influenced primarily
by a 31.1% increase in average earning assets. The decrease in net interest
margin resulted primarily from increased borrowings related to increased
trading activity, and the effect of rates on earning assets declining while
rates paid on interest-bearing funds increased slightly.
11
<PAGE> 12
ZIONS BANCORPORATION AND SUBSIDIARIES
NET INTEREST INCOME AND RATES
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, 1994 June 30, 1994
------------------------ ------------------
Average Amount of Average Average Amount of Average
(In thousands) Balance Interest* Rate Balance Interest* Rate
--------- --------- ------- --------- --------- -------
<S> <C> <C> <C> <C> <C> <C>
Money market investments:
Interest-bearing deposits $ 24,623 $ 305 4.97% $ 24,737 $ 505 4.12%
Federal funds sold and security
resell agreements 920,992 8,838 3.85% 946,982 16,302 3.47%
Other money market investments - -- --% -- -- --%
--------- ------ ---- --------- ------- ----
Total money market investments 945,615 9,143 3.88% 971,719 16,807 3.49%
--------- ------ ---- --------- ------- ----
Securities:
Held to maturity:
Taxable 723,366 9,308 5.16% 696,089 17,460 5.06%
Nontaxable 197,561 4,157 8.44% 189,164 7,637 8.14%
Available for sale 327,702 5,038 6.17% 336,918 9,879 5.91%
Trading account securities 318,851 4,151 5.22% 263,742 6,628 5.07%
--------- ------ ---- --------- ------- ----
Total securities 1,567,480 22,654 5.80% 1,485,913 41,604 5.65%
--------- ------ ---- --------- ------- ----
Loans:
Loans held for sale 191,050 3,139 6.59% 207,440 6,398 6.22%
Loans, leases and other receivables** 2,406,265 53,083 8.85% 2,344,085 101,467 8.73%
--------- ------ ---- --------- ------- ----
Total loans 2,597,315 56,222 8.68% 2,551,525 107,865 8.53%
--------- ------ ---- --------- ------- ----
Total earning assets $5,110,410 $88,019 6.91% $5,009,157 $166,276 6.69%
========= ====== ==== ========= ======= ====
Interest-bearing deposits:
Savings $ 707,909 $ 5,565 3.15% $ 723,408 $ 10,678 2.98%
Money market 1,315,483 9,211 2.81% 1,248,109 17,114 2.77%
Time under $100,000 532,145 4,934 3.72% 527,837 10,049 3.84%
Time over $100,000 108,162 968 3.59% 95,525 1,728 3.65%
Foreign 114,369 1,059 3.71% 97,275 1,613 3.34%
--------- ------ ---- --------- ------- ----
Total interest-bearing deposits 2,778,068 21,737 3.14% 2,692,154 41,182 3.08%
--------- ------ ---- --------- ------- ----
Borrowed funds:
Securities sold, not yet purchased 206,786 2,741 5.32% 142,739 3,640 5.14%
Federal funds purchased and security
repurchase agreements 1,096,903 10,305 3.77% 1,146,396 19,042 3.35%
FHLB advances and other borrowings:
Less than one year 40,761 495 4.87% 46,121 991 4.33%
Over one year 115,336 1,379 4.80% 134,148 2,822 4.24%
Long-term debt 59,578 1,374 9.25% 59,499 2,766 9.37%
--------- ------ ---- --------- ------- ----
Total borrowed funds 1,519,364 16,294 4.30% 1,528,903 29,261 3.86%
--------- ------ ---- --------- ------- ----
Total interest-bearing funds $4,297,432 $38,031 3.55% $4,221,057 $ 70,443 3.37%
========= ====== ==== ========= ======= ====
Net interest income $49,988 $95,833
Net interest margin 3.92% 3.86%
Spread on average interest-bearing funds 3.36% 3.32%
</TABLE>
*Taxable-equivalent rates used where applicable.
** Net of unearned income and fees, net of related costs.
Loans include nonaccrual and restructured loans
12
<PAGE> 13
ZIONS BANCORPORATION AND SUBSIDIARIES
NET INTEREST INCOME AND RATES
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, 1993 June 30, 1993
------------------------- ----------------
Average Amount of Average Average Amount of Average
(In thousands) Balance Interest* Rate Balance Interest* Rate
--------- --------- -------- ------- --------- -------
<S> <C> <C> <C> <C> <C>
Money market investments:
Interest-bearing deposits $ 144,016 $ 1,787 4.98% $ 156,573 $ 3,824 4.93%
Federal funds sold and security
resell agreements 338,619 2,810 3.33% 346,635 5,729 3.33%
Other money market investments 25,764 170 2.65% 32,218 437 2.74%
--------- ------ ----- --------- ------- -----
Total money market investments 508,399 4,767 3.76% 535,426 9,990 3.76%
-------- ------ ----- --------- ------- -----
Securities:
Held to maturity:
Taxable 1,004,699 14,801 5.91% 934,722 28,116 6.07%
Nontaxable 134,713 3,004 8.94% 131,350 5,769 8.86%
Available for sale -- -- --% -- -- --%
Trading account securities 44,639 1,136 10.21% 40,809 2,188 10.81%
--------- ------ ----- --------- ------- -----
Total securities 1,184,051 18,941 6.42% 1,106,881 36,073 6.57%
--------- ------ ----- --------- ------- -----
Loans:
Loans held for sale 189,905 2,997 6.33% 187,507 5,996 6.45%
Loans, leases and other receivables** 2,042,175 45,347 8.91% 1,990,592 88,469 8.96%
--------- ------ ----- --------- ------- -----
Total loans 2,232,080 48,344 8.69% 2,178,099 94,465 8.75%
--------- ------ ----- --------- ------- -----
Total earning assets $3,924,530 $72,052 7.36% $3,820,406 $140,528 7.42%
========= ====== ----- ========= ======= =====
Interest-bearing deposits:
Savings $ 640,959 $ 4,549 2.85% $ 632,822 $ 9,197 2.93%
Money market 1,094,481 7,740 2.84% 1,082,219 15,208 2.83%
Time under $100,000 564,329 6,000 4.26% 579,963 12,555 4.37%
Time over $100,000 82,690 768 3.73% 79,389 1,478 3.75%
Foreign 59,256 315 2.13% 56,930 656 2.32%
--------- ------ ----- --------- ------- -----
Total interest-bearing deposits 2,441,715 19,372 3.18% 2,431,323 39,094 3.24%
--------- ------ ----- --------- ------- -----
Borrowed funds:
Securities sold, not yet purchased -- -- -- -- -- --%
Federal funds purchased and security
repurchase agreements 536,422 3,744 2.80% 489,637 6,771 2.79%
FHLB advances and other borrowings:
Less than one year 93,369 825 3.54% 85,945 1,598 3.75%
Over one year 85,333 862 4.05% 69,072 1,286 3.75%
Long-term debt 78,392 1,475 7.55% 88,754 4,028 9.15%
--------- ------ ----- --------- ------- ----
Total borrowed funds 793,516 6,906 3.49% 733,408 13,683 3.76%
--------- ------ ----- --------- ------- -----
Total interest-bearing funds $3,235,231 $26,278 3.26% $3,164,731 $ 52,777 3.36%
========= ====== ----- ========= ======= =====
Net interest income $45,774 $ 87,751
Net interest margin 4.68% 4.63%
Spread on average interest-bearing funds 4.10% 4.06%
</TABLE>
*Taxable-equivalent rates used where applicable.
** Net of unearned income and fees, net of related costs.
Loans include nonaccrual and restructured loans
13
<PAGE> 14
ZIONS BANCORPORATION AND SUBSIDIARIES
PROVISION FOR LOAN LOSSES
The provision for loan losses was $467,000 for the second quarter of 1994, as
compared with $408,000 for the second quarter of 1993, an increase of 14.5% and
$290,000 for the first quarter of 1994. Net charge-offs for the second quarter
of 1994 were $778,000 or .03% of average net loans and leases, compared to net
recoveries of $6,152,000 or (.28)% of average loans and leases for the second
quarter of 1993, and net charge-offs of $767,000 or .03% of average loans and
leases for the first quarter of 1994. The provision for loan losses for the
first six months of 1994 totaled $757,000, 57.3% less than the provision for
the first six months of 1993. Net charge-offs for the first six months of 1994
were $1,545,000 or .06% of average net loans and leases, compared to net
recoveries of $5,476,000 for the first six months of 1993 or (.25)% of average
net loans and leases.
OTHER OPERATING INCOME
Other operating income for the second quarter of 1994 totaled $18,465,000, a
decrease of 4.7% from the $19,371,000 for the second quarter of 1993 but an
increase of 12.6% over the $16,396,000 for the first quarter of 1994.
Comparing the second quarter of 1994 and the second quarter of 1993, other
service charges, commissions and fees, and trading account income increased
16.8% and 27.9%, respectively, while service charges on deposit accounts, trust
income, loan sales and servicing income, and other income decreased 5.1%, 5.0%,
5.8% and 46.1%, respectively, and sales of investment securities resulted in
greater net losses.
Other operating income for the six months ending June 30, 1994 decreased .8% to
$34,861,000, compared to $35,137,000 for the first six months of 1993.
Comparing the first six months of 1994 and the first six months of 1993,
service charges on deposit accounts, other service charges, commissions and
fees, and loan sales and servicing income increased .3%, 17.9% and 4.6%,
respectively, while trust income, trading account income and other income
decreased 3.9%, 59.6% and 34.6%, respectively, and sales of investment
securities resulted in greater net losses.
Trading account income and loan sales income were adversely affected by
mark-to-market adjustments on trading securities and mortgages held for sale as
a result of rising interest rates during the first quarter of 1994, and the
decrease in other income resulted primarily from the gain on the sale of an
interest rate exchange contract agreement reported in 1993.
OTHER OPERATING EXPENSES
Other operating expenses for the second quarter of 1994, totaling $41,996,000,
increased 7.6% from the $39,047,000 for the second quarter of 1993 but
decreased 1.2% from the $42,491,000 for the first quarter of 1994. Comparing
the second quarter of 1994 and the second quarter of 1993, salaries and
employee benefits increased 10.3%, occupancy, furniture and equipment expenses
increased 26.3%, and the total of all other expenses decreased 1.7%.
Other operating expenses for the six months ending June 30, 1994 of $84,487,000
increased 12.5% compared to the $75,090,000 to the corresponding period in
1993, excluding the one-time expense of $6,022,000 related to the early
extinguishment of debt. Comparing the first six months of 1994 and the first
six months of 1993, salaries and employee benefits increased 15.6%, occupancy,
furniture and equipment expenses increased 22.4%, and the total of all other
expenses increased 5.2%. The increase in salaries and employee benefits
resulted primarily from increased staffing in investment and mortgage
origination and servicing activities, general salary increases, bonuses and
commission costs. The
14
<PAGE> 15
ZIONS BANCORPORATION AND SUBSIDIARIES
increase in occupancy, furniture and equipment expenses resulted primarily from
the expansion of the ATM network, and the installation of personal computers
and local area networks during the last half of 1993. The increase in all
other expenses resulted primarily from increases in supplies, postage and
telecommunications related to acquisitions and expansion.
INCOME TAXES
The Company experienced an income tax expense of $8,325,000 for the second
quarter of 1994 compared to $8,093,000 for the second quarter of 1993, and
$5,978,000 for the first quarter of 1994, Tax expense for the first six months
of 1994 was $14,303,000 compared to $12,434,000 for the first six months of
1993.
ANALYSIS OF FINANCIAL CONDITION
EARNING ASSETS
Average earning assets grew to $5,009.2 million in the six months ended June
30, 1994 compared to $3,820.4 million in the six months ended June 30, 1993.
Earning assets comprised 91.8% of total average assets for the first six months
of 1994, compared with 91.2% for the first six months of 1993.
Average money market investments, consisting of interest-bearing deposits,
federal funds sold and security resell agreements, and other money market
investments, increased 81.5% to $971.7 million compared to $535.4 million in
the first six months of 1994.
During the first six months of 1994, average securities increased 34.2% to
$1,485.9 million compared to $1,106.9 million in the first six months of 1993.
Average taxable securities increased 10.5%, nontaxable securities increased
44.0%, and trading account securities increased 546.3% compared with the same
period in 1993.
Average net loans and leases increased 17.1% to $2,551.5 million for the first
six months of 1994 compared to $2,178.1 in the first six months of 1993,
representing 50.9% of earning assets in the first six months of 1994 compared
to 57.0% in the first six months of 1993.
15
<PAGE> 16
ZIONS BANCORPORATION AND SUBSIDIARIES
CONSOLIDATED AVERAGE BALANCE SHEETS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
--------------------- ---------------------
(In thousands) 1994 1993 1994 1993
---- ---- ---- ----
<S> <C> <C> <C> <C>
Assets
Cash and due from banks $ 344,264 $ 306,046 $ 328,738 $ 295,713
Money market investments:
Interest-bearing deposits 24,623 144,016 24,737 156,573
Federal funds sold and security resell agreements 920,992 338,619 946,982 346,635
Other money market investments -- 25,764 -- 32,218
Securities:
Held to maturity:
Taxable 723,366 1,004,699 696,089 934,722
Nontaxable 197,561 134,713 189,164 131,350
Available for sale 327,702 -- 336,918 --
Trading account securities 318,851 44,639 263,742 40,809
--------- ---------- --------- ---------
1,567,480 1,184,051 1,485,913 1,106,881
Loans:
Loans held for sale 191,050 189,905 207,440 187,507
Loans, leases and other receivables 2,425,433 2,066,426 2,364,127 2,015,003
--------- --------- --------- ---------
2,616,483 2,256,331 2,571,567 2,202,510
Less
Unearned income and fees, net of related costs 19,168 24,251 20,042 24,411
Allowance for loan losses 68,796 64,514 68,398 62,550
--------- --------- --------- ---------
2,528,519 2,167,566 2,483,127 2,115,549
Premises and equipment. at cost,
less accumulated depreciation 73,793 67,061 73,073 66,207
Amounts paid in excess of net assets of acquired businesses 16,888 12,171 14,379 12,221
Other real estate owned 1,537 6,445 2,124 6,122
Other assets 100,258 51,343 97,153 50,252
--------- --------- --------- ---------
Total assets $5,578,354 $4,303,082 $5,456,226 $4,188,371
========= ========= ========= =========
Liabilities and shareholders' equity
Deposits:
Noninterest-bearing demand $ 855,403 $ 719,006 $ 834,228 $ 686,358
Interest-bearing:
Savings and money market 2,023,392 1,735,440 1,971,517 1,715,041
Time under $100,000 532,145 564,329 527,837 579,963
Time over $100,000 108,162 82,690 95,525 79,389
Foreign 114,369 59,256 97,275 56,930
--------- --------- --------- ---------
3,633,471 3,160,721 3,526,382 3,117,681
Securities sold, not yet purchased 206,786 -- 142,739 --
Federal funds purchased and security repurchase agreements 1,096,903 536,422 1,146,396 489,637
Accrued liabilities 86,759 64,837 73,736 60,398
Federal Home Loan Bank advances and other borrowings:
Less than one year 40,761 93,369 46,121 85,945
Over one year 115,336 85,333 134,148 69,072
Long-term debt 59,578 78,392 59,499 88,754
--------- --------- --------- ---------
Total liabilities 5,239,594 4,019,074 5,129,021 3,911,487
--------- --------- --------- ---------
Shareholders' equity:
Preferred stock -- -- -- --
Common stock 78,965 65,706 72,642 65,604
Net unrealized holding gains and losses (2,445) -- (1,509) --
Retained earnings 262,240 218,302 256,072 211,280
--------- --------- --------- ---------
Total shareholders' equity 338,760 284,008 327,205 276,884
--------- --------- --------- ---------
Total liabilities and shareholders' equity $5,578,354 $4,303,082 $5,456,226 $4,188,371
========= ========= ========= =========
</TABLE>
16
<PAGE> 17
ZIONS BANCORPORATION AND SUBSIDIARIES
LOANS
The Company has structured its organization to separate the lending function
from the credit administration function to strengthen the control and
independent evaluation of credit activities. Loan policies and procedures
provide the Company with a framework for consistent underwriting and a basis
for sound credit decisions. In addition, the Company has well-defined
standards for grading its loan portfolio, and management utilizes the
comprehensive loan grading system to determine risk potential in the portfolio.
Another aspect of the Company's credit risk management strategy is the
diversification of the loan portfolio. The Company has a well-diversified loan
portfolio with no significant exposure to highly leveraged transactions and has
no foreign credits in its loan portfolio.
The table below sets forth the amount of loans outstanding by type at June 30,
1994 and December 31, 1993.
<TABLE>
<CAPTION>
(In thousands)
Types June 30, 1994 December 31, 1993
----- ------------- -----------------
<S> <C> <C>
Loans held for sale $ 190,198 $ 238,206
Commercial, financial, and agricultural 532,890 511,982
Real estate:
Construction 191,008 213,114
Other 1,182,857 1,022,888
Consumer 447,782 378,679
Lease financing 126,711 130,450
Other receivables 13,302 12,857
--------- ---------
Total loans $2,684,748 $2,508,176
========= =========
</TABLE>
Loans held for sale at June 30, 1994 decreased 20.2% from year-end 1993. All
other loans, net of unearned income and fees increased 10.1% to $2,474.9
million at June 30, 1994, compared to $2,248.1 million at December 31, 1993.
Commercial loans, other real estate-secured loans and consumer loans increased
from year end 4.1% 15.6% and 18.2%, respectively, as real estate construction
loans decreased 10.4% and lease financing decreased 2.9% from year end. Within
the other real estate-secured loan portfolio, 1-4 family residential loans
increased 14.9%, home equity credit line loans increased 17.9% and all other
real estate loans increased 15.5% from year end.
17
<PAGE> 18
ZIONS BANCORPORATION AND SUBSIDIARIES
RISK ELEMENTS
The Company's nonperforming assets, which include nonaccruing loans,
restructured loans and other real estate owned and other nonperforming assets,
were $21,658,000 at June 30, 1994, down 35.1% from $33,379,000 at June 30,
1993, and down 29.3% from $30,637,000 at December 31, 1993. Such nonperforming
assets as a percentage of net loans and leases and other real estate owned and
other nonperforming assets were .81%, 1.52% and 1.23% at June 30, 1994, June
30, 1993, and December 31, 1993, respectively.
Accruing loans past due 90 days or more totaled $1,910,000 at June 30, 1994, up
14.1% from $1,674,000 at June 30, 1993, and down 82.3% from $10,821,000 at
December 31, 1993.
One loan in the amount of $2,986,000 at June 30, 1994 was considered a
potential problem loan compared to no loans at June 30, 1993 and two loans
totaling $1,114,000 at December 31, 1993. Potential problem loans are defined
as loans presently current by their terms, but about which management has
serious doubt as to the future ability of the borrower to comply with present
repayment terms and which may result in the reporting of the loans as
nonperforming assets.
The following table sets forth the nonperforming assets at June 30, 1994 and
1993, and December 31, 1993.
<TABLE>
<CAPTION> June 30, December 31,
-------- -------------
(In thousands) 1994 1993 1993
---- ---- ----
<S> <C> <C> <C>
Nonaccrual loans $15,521 $26,955 $23,364
Restructured loans 1,210 1,154 4,006
Other real estate owned and other
nonperforming assets 4,927 5,270 3,267
------ ------ ------
Total $21,658 $33,379 $30,637
====== ====== ======
% of net loans and leases* and other real estate
owned and other nonperforming assets .81% 1.52% 1.23%
Accruing loans past due 90 days or more $ 1,910 $ 1,674 $10,821
====== ====== ======
% of net loans and leases* .07% .08% .44%
*Includes loans held for sale.
</TABLE>
18
<PAGE> 19
ZIONS BANCORPORATION AND SUBSIDIARIES
ALLOWANCE FOR LOAN LOSSES
In analyzing the adequacy of the allowance for loan and lease losses,
management utilizes a comprehensive loan grading system to determine risk
potential in the portfolio, and considers the results of independent internal
and external credit review, historical charge-off experience, and changes in
the composition and volume of the portfolio. Other factors, such as general
economic conditions and collateral values, are also considered. Larger problem
credits are individually evaluated to determine appropriate reserve
allocations. Additions to the allowance are based upon the resulting risk
profile of the portfolio developed through the evaluation of the above factors.
The following table shows the changes in the allowance for loan losses and a
summary of loan loss experience.
<TABLE>
<CAPTION>
Twelve Months
Six Months Ended Ended
(In thousands) June 30, December 31,
----------------------- ------------
1994 1993 1993
---- ---- ----
<S> <C> <C> <C>
Average loans* and leases outstanding
(net of unearned income) $2,551,525 $2,178,099 $2,222,182
========= ========= =========
Allowance for possible losses:
Balance at beginning of the period $ 68,461 $ 59,807 $ 59,807
Allowance of companies acquired 1,308 546 546
Loans and leases charged-off:
Loans held for sale - - -
Commercial, financial and agricultural (2,274) (407) (1,804)
Real estate (371) (418) (1,179)
Consumer (2,029) (3,430) (5,461)
Lease financing (709) (292) (360)
Other receivables - - -
---------- -------- ----------
Total (5,383) (4,547) (8,804)
---------- -------- ----------
Recoveries:
Loans held for sale - - -
Commercial, financial and agricultural 1,281 8,140 10,117
Real estate 123 222 611
Consumer 2,305 1,608 3,043
Lease financing 129 53 148
Other receivables - - -
---------- -------- ----------
Total 3,838 10,023 13,919
---------- -------- ----------
Net loan and lease (charge-offs) recoveries (1,545) 5,476 5,115
Provision charged against earnings 757 1,773 2,993
---------- --------- ----------
Balance at end of the period $ 68,981 $ 67,602 $ 68,461
========= ========= =========
*Includes loans held for sale
Ratio of net charge-offs (recoveries) to
average loans and leases .06% (.25)% (.23)%
</TABLE>
19
<PAGE> 20
ZIONS BANCORPORATION AND SUBSIDIARIES
The allowance for loan losses as a percentage of net loans and leases was 2.59%
at June 30, 1994, compared to 3.08% at June 30, 1993 and 2.75% at December 31,
1993. The allowance, as a percentage of nonaccrual loans and accruing loans
past due 90 days or more was 395.7% at June 30, 1994, compared to 236.1% at
June 30, 1993 and 200.3% at December 31, 1993. The allowance, as a percentage
of nonaccrual loans and restructured loans was 412.3% at June 30, 1994,
compared to 240.5% at June 30, 1993 and 250.1% at December 31, 1993.
Included in the allowance for loan losses is an amount for unused loan
commitments and standby letters of credit which at June 30, 1994 and 1993, and
at December 31, 1993, amounted to $3,961,000, $4,134,000 and $1,972,000,
respectively. Unused loan commitments and standby letters of credit, at June
30, 1994 and 1993, and at December 31, 1993, amounted to $1,150.8 million,
$982.5 million and $1,106 million, respectively.
DEPOSITS
Average total deposits of $3,526.4 million for the first six months of 1994
increased 13.1% over the $3,117.7 million for the first six months of 1993,
with average demand deposits increasing 21.5%. Average savings and money
market deposits, time deposits over $100,000 and foreign deposits for the first
six months of 1994 increased 15.0%, 20.3% and 70.9%, respectively, from the
first six months of 1993. Average time deposits under $100,000, decreased 9.0%
during the first six months of 1994, compared with the same period one year
earlier.
Total deposits increased 4.9% to $3,599.2 million compared to $3,432.3 million
at December 31, 1993. Comparing June 30, 1994 to December 31, 1993, savings
and money market deposits, time deposits over $100,000 and foreign deposits
increased 9.7%, 35.1% and 11.1%, respectively, while demand deposits decreased
3.9% and time deposits under $100,000 decreased 3.1%.
LIQUIDITY AND INTEREST RATE SENSITIVITY
Average net loans and leases were 72.4% of average total deposits for the six
months ended June 30, 1994 compared to 69.9% for the six months ended June 30,
1993. Liquidity is primarily provided by the regularly scheduled maturities of
the Company's investment and loan portfolios. In addition, the Company's
liquidity is enhanced by the fact that cash, money market securities and liquid
investments, net of "short-term purchased" liabilities and wholesale deposits,
totaled $1,116.1 million or 32.7% of core deposits at June 30, 1994.
The Company's core deposits, consisting of demand, savings and money market
deposits and time deposits under $100,000, constituted 94.9% of total deposits
at June 30, 1994 compared to 95.6% at December 31, 1993.
Maturing balances in loan portfolios provide flexibility in managing cash
flows. Maturity management of those funds is an important source of medium-to
long-term liquidity. The Company's ability to raise funds in the capital
markets through the "securitization" process and by debt issuances allows the
Company to take advantage of market opportunities to meet funding needs at
reasonable cost. The Company manages its liquidity position in order to assure
its ability to meet maturing obligations.
20
<PAGE> 21
ZIONS BANCORPORATION AND SUBSIDIARIES
The Company, through the management of interest rate "maturities" and the use
of off-balance sheet arrangements such as interest rate caps, floors, and
interest rate exchange contract agreements, attempts to structure portfolios in
such a way as to minimize the effects of fluctuating interest rate levels on
net interest income.
Considering Zions Bancorporation independent from its subsidiaries (Parent
Company), the Parent Company's cash requirements consist primarily of principal
and interest payments on its borrowings, dividend payments to shareholders, and
cash operating expenses and income taxes. The Parent Company's cash needs are
routinely satisfied through payments by subsidiaries of dividends, management
and other fees, principal and interest payments on subsidiary borrowings from
the parent Company, and proportionate shares of income taxes.
CAPITAL RESOURCES AND DIVIDENDS
Total shareholders' equity at June 30, 1994 was $341.8 million, an increase of
9.3% over the $312.6 million at December 31, 1993, and an increase of 18.7%
over the $288.0 million at June 30, 1993. The ratio of average equity to
average assets for the first six months of 1994 was 6.00%, compared to 6.61%
for the same period in 1993. At June 30, 1994, the Company's Tier I
risk-based capital ratio was 10.61%, compared to 10.85% at December 31, 1993
and 11.01% at June 30, 1993. At June 30, 1994, the Company's total risk-based
capital ratio was 13.69%, compared to 14.12% at December 31, 1993 and 14.47% at
June 30, 1993. The Company's leverage ratio as of June 30, 1994 was 5.62%,
compared to 5.44% at December 31, 1993 and 6.33% at June 30, 1993.
Dividends declared per common share for the second quarter of 1994 of $.28
increased 33.3% compared to $.21 for the second quarter of 1993. Dividends
declared per common share of $.56 for the first six months of 1994 increased
33.3% compared to $.42 for the first six months of 1993. The cash dividend
payout to net income applicable to common shares for the first six months of
1994 was 29.6%, compared to 20.7% for the first six months of 1993.
MERGERS AND ACQUISITIONS
At the close of business, April 29, 1994, the purchase transaction of Zions
Bancorporation and Rio Salado Bancorp and it's wholly owned subsidiary, Rio
Salado Bank, was consummated at a purchase price of $12.5 million, paid through
the exchange of Zions Bancorporation common stock for Rio Salado Bancorp stock.
Rio Salado Bank was merged into Zions Bancorporation's wholly owned subsidiary,
National Bank of Arizona, resulting in an organization with approximately $700
million in assets.
21
<PAGE> 22
ZIONS BANCORPORATION AND SUBSIDIARIES
PART II. OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SHAREHOLDERS
The following is a summary of matters submitted to vote at the Annual Meeting
of Shareholders of Zions Bancorporation:
a) The Annual Meeting of Shareholders was held on April 29, 1994.
b) Election of Directors
Proxies were solicitied by Zions Bancorporation's management
pursuant to Regulation 14A under the Securities Exchange Act of
1934. There was no solicitation in opposition to management's
nominees as listed in the proxy statement, and all of such nominees
were elected pursuant to the vote of the shareholders as indicated
in the proxy statement.
c) The matters voted upon and the results of the voting were as
follows:
(1) Election of Directors
<TABLE>
<CAPTION>
Withhold
For Authority
--- ---------
<S> <C> <C>
R. D. Cash 12,008,388 16,916
Richard H. Madsen 12,009,314 15,990
Robert G. Sarver 12,009,886 15,418
Harris H. Simmons 12,001,904 23,340
</TABLE>
(2) Appointment of Independent Accountants
The selection of KPMG Peat Marwick as the firm of independent
certified public accountants to audit the books and accounts of
Zions Bancorporation and its subsidiaries for the year ending
December 31, 1994 was ratified.
<TABLE>
<CAPTION>
For Against Abstain
--- ------- -------
<S> <C> <C>
12,028,095 12,941 25,669
</TABLE>
22
<PAGE> 23
ZIONS BANCORPORATION AND SUBSIDIARIES
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a) Exhibits - None
b) Reports on Form 8-K
There were no reports on Form 8-K filed during the quarter ending
June 30, 1994.
S I G N A T U R E S
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
ZIONS BANCORPORATION
/s/ Harris H. Simmons
--------------------------------------
Harris H. Simmons, President and
Chief Executive Officer
/s/ Gary L. Anderson
--------------------------------------
Gary L. Anderson, Senior Vice President
and Chief Financial Officer
Dated: August 12, 1994
23
