<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, 1996
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)
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)
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, 1996 14,773,841 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 4
Consolidated Statements of Cash Flows 5
Consolidated Statements of Retained Earnings 6
Notes to Consolidated Financial Statements 7
ITEM 2. Management's Discussion and Analysis 8
PART II. OTHER INFORMATION
ITEM 4. Submission of Matters to a Vote of Shareholders 21
ITEM 6. Exhibits and Reports on Form 8-K 22
SIGNATURES 22
</TABLE>
2
<PAGE> 3
ZIONS BANCORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
<TABLE>
<CAPTION>
June 30, December 31, June 30,
(In thousands) 1996 1995 1995
----------- ------------ -----------
<S> <C> <C> <C>
ASSETS
Cash and due from banks $ 338,616 $ 418,067 $ 325,447
Money market investments:
Interest-bearing deposits 40,996 34,580 26,457
Federal funds sold 10,967 50,467 75,766
Security resell agreements 334,419 602,204 825,423
Securities:
Held to maturity at cost (approximate market value
$1,340,467, $1,093,934 and $1,145,573):
Taxable 1,121,745 881,172 926,927
Nontaxable 214,104 197,411 212,910
Available for sale at market:
Taxable 390,500 356,116 381,049
Nontaxable 40,694 42,084 --
Trading account at market 175,259 63,706 73,317
----------- ----------- -----------
1,942,302 1,540,489 1,594,203
Loans:
Loans held for sale at cost, which approximates market 166,967 126,124 110,768
Loans, leases and other receivables 3,080,511 2,711,784 2,567,300
----------- ----------- -----------
3,247,478 2,837,908 2,678,068
Less:
Unearned income and fees, net of related costs 35,287 30,952 26,336
Allowance for loan losses 69,272 67,555 67,753
----------- ----------- -----------
3,142,919 2,739,401 2,583,979
Premises and equipment, at cost, less accumulated depreciation 88,312 81,613 79,514
Amounts paid in excess of net assets of acquired businesses 37,673 21,738 22,524
Other real estate owned 259 1,092 641
Other assets 151,451 130,995 130,385
----------- ----------- -----------
Total assets $ 6,087,914 $ 5,620,646 $ 5,664,339
=========== =========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits:
Noninterest-bearing demand $ 1,000,183 $ 998,560 $ 890,805
Interest-bearing:
Savings and money market 2,394,220 2,164,344 2,122,646
Time under $100,000 672,720 669,196 646,994
Time over $100,000 182,037 158,924 105,251
Foreign 91,156 106,090 124,484
----------- ----------- -----------
4,340,316 4,097,114 3,890,180
Securities sold, not yet purchased 111,010 117,005 86,827
Federal funds purchased 124,686 134,048 177,469
Security repurchase agreements 817,070 614,284 867,497
Accrued liabilities 68,983 72,376 70,275
Federal Home Loan Bank advances and other borrowings:
Less than one year 17,925 14,910 27,786
Over one year 78,410 86,174 94,494
Long-term debt 55,992 56,229 57,526
----------- ----------- -----------
Total liabilities 5,614,392 5,192,140 5,272,054
----------- ----------- -----------
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,
14,772,665, 14,555,920 and 14,543,162 shares 84,604 73,477 74,336
Net unrealized holding gains and losses on securities
available for sale (959) 1,850 (1,526)
Retained earnings 389,877 353,179 319,475
----------- ----------- -----------
Total shareholders' equity 473,522 428,506 392,285
----------- ----------- -----------
Total liabilities and shareholders' equity $ 6,087,914 $ 5,620,646 $ 5,664,339
=========== =========== ===========
</TABLE>
3
<PAGE> 4
ZIONS BANCORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
------------------------- --------------------------
(In thousands, except share amounts) 1996 1995 1996 1995
---- ---- ---- ----
<S> <C> <C> <C> <C>
Interest income:
Interest and fees on loans $ 69,715 $ 60,503 $ 134,956 $ 115,987
Interest on loans held for sale 3,040 2,180 5,780 4,308
Interest on money market investments 11,792 14,072 27,172 24,067
Interest on securities:
Held to maturity:
Taxable 16,878 16,337 32,565 31,841
Nontaxable 3,123 3,089 6,313 6,095
Available for sale:
Taxable 6,081 5,743 11,743 11,386
Nontaxable 565 -- 1,127 --
Trading account 2,033 1,051 4,437 4,676
Lease financing 2,851 2,461 5,493 4,855
--------- --------- --------- ---------
Total interest income 116,078 105,436 229,586 203,215
--------- --------- --------- ---------
Interest expense:
Interest on savings and money market deposits 21,251 20,657 41,128 40,162
Interest on time deposits under $100,000 8,714 7,738 17,611 13,823
Interest on time deposits over $100,000 2,443 1,482 5,023 2,760
Interest on foreign deposits 1,334 1,820 2,491 3,821
Interest on securities sold, not yet purchased 1,290 465 2,280 2,741
Interest on borrowed funds 17,556 17,377 37,614 30,810
--------- --------- --------- ---------
Total interest expense 52,588 49,539 106,147 94,117
--------- --------- --------- ---------
Net interest income 63,490 55,897 123,439 109,098
Provision for loan losses 760 850 1,360 1,450
--------- --------- --------- ---------
Net interest income after provision for loan losses 62,730 55,047 122,079 107,648
--------- --------- --------- ---------
Noninterest income:
Service charges on deposit accounts 8,042 7,033 15,749 13,965
Other service charges, commissions and fees 6,346 6,040 13,187 11,440
Trust income 1,329 1,152 2,611 2,232
Investment securities gains (losses), net 68 52 70 (53)
Trading account income (loss) 752 111 1,625 (2,826)
Loan sales and servicing income 8,320 6,210 15,430 11,569
Other income 1,669 1,507 3,931 3,119
--------- --------- --------- ---------
Total noninterest income 26,526 22,105 52,603 39,446
--------- --------- --------- ---------
Noninterest expenses:
Salaries and employee benefits 28,425 24,856 55,420 48,363
Occupancy, net 2,638 2,904 5,422 5,060
Furniture and equipment 3,738 2,773 7,344 6,258
Other real estate expense 53 (23) (230) 57
Legal and professional services 1,384 766 2,123 2,101
Supplies 1,599 1,144 3,121 2,395
Postage 1,285 1,261 2,641 2,508
Advertising 1,487 1,241 2,969 2,301
FDIC premiums 1 1,963 6 3,917
Amortization of intangible assets 978 858 1,742 1,671
Other expenses 9,852 8,139 20,634 17,369
--------- --------- --------- ---------
Total noninterest expenses 51,440 45,882 101,192 92,000
--------- --------- --------- ---------
Income before income taxes 37,816 31,270 73,490 55,094
Income taxes 12,752 10,749 24,755 18,572
--------- --------- --------- ---------
Net income $ 25,064 $ 20,521 $ 48,735 $ 36,522
========= ========= ========= =========
Weighted average common and common-equivalent shares outstanding 14,746 14,786 14,711 14,732
Net income per common share $ 1.70 $ 1.39 $ 3.31 $ 2.48
</TABLE>
4
<PAGE> 5
ZIONS BANCORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
--------------------------- -----------------------------
(In thousands) 1996 1995 1996 1995
---- ---- ---- ----
<S> <C> <C> <C> <C>
Cash flows from operating activities:
Net income $ 25,064 $ 20,521 $ 48,735 $ 36,522
Adjustments to reconcile net income to net cash
provided by (used in) operating activities:
Provision for loan losses 760 850 1,360 1,450
Write-downs of other real estate owned -- -- -- 8
Depreciation of premises and equipment 3,052 2,573 6,037 5,038
Amortization of premium on core deposits and
other intangibles 978 858 1,742 1,671
Amortization of net premium/discount on
investment securities 1,659 1,136 3,235 2,114
Accretion of unearned income and fees, net of
related costs 1,635 1,655 3,768 1,468
Proceeds from sales of trading account securities 14,585,455 12,123,667 29,345,404 51,572,234
Increase in trading account securities (14,678,826) (12,113,616) (29,456,956) (51,446,225)
Net (gain) loss on sales of investment securities (68) (52) (70) 53
Proceeds from loans held for sale 173,434 78,697 326,217 160,395
Increase in loans held for sale (175,127) (84,147) (354,399) (161,329)
Net gain on sales of loans, leases and other assets (6,540) (3,968) (11,920) (7,233)
Net (gain) loss on sales of other real estate owned 23 (8) (258) (78)
Change in accrued income taxes (8,948) (5,311) 3,103 (84)
Change in accrued interest receivable (5,941) (1,947) (7,476) (2,652)
Change in other assets (942) 311 (6,720) 856
Change in accrued interest payable (1,963) (55) (295) 25
Change in accrued liabilities (681) 5,160 (6,777) (254)
------------ ------------ ------------ ------------
Net cash provided by (used in) operating
activities (86,976) 26,324 (105,270) 163,979
------------ ------------ ------------ ------------
Cash flows from investing activities:
Net (increase) decrease in money market investments 675,518 (286,068) 324,944 (521,723)
Proceeds from maturities of investment securities
held to maturity 45,812 33,284 108,024 50,472
Purchases of investment securities held to maturity (233,801) (39,188) (364,275) (78,197)
Proceeds from sales of investment securities
available for sale 45,092 79,976 46,551 107,763
Proceeds from maturities of investment securities
available for sale 9,136 166,210 78,418 172,227
Purchases of investment securities available for sale (92,086) (273,869) (161,372) (290,797)
Proceeds from sales of loans and leases 240,017 123,394 381,278 234,486
Net increase in loans and leases (391,219) (274,816) (660,635) (471,187)
Purchases of assets to be leased -- -- (8,514) --
Principal collections on leveraged leases -- -- -- 38
Proceeds from sales of premises and equipment 531 273 591 399
Purchases of premises and equipment (4,845) (5,738) (9,067) (9,457)
Proceeds from sales of other real estate owned 562 745 1,438 1,345
Proceeds from sales of mortgage servicing rights 291 288 914 498
Purchases of mortgage servicing rights (51) (37) (1,492) (61)
Proceeds from sales of other assets 253 175 448 359
Cash paid for acquisitions, net of cash received 3,550 1,592 3,550 1,592
------------ ------------ ------------ ------------
Net cash provided by (used in) investing
activities 298,760 (473,779) (259,199) (802,243)
------------ ------------ ------------ ------------
</TABLE>
5
<PAGE> 6
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) 1996 1995 1996 1995
---- ---- ---- ----
<S> <C> <C> <C> <C>
Cash flows from financing activities:
Net increase in deposits 55,326 72,614 129,208 153,066
Net change in short-term funds borrowed (303,446) 447,221 191,650 528,287
Proceeds from FHLB advances over one year 350 -- 350 --
Payments on FHLB advances over one year (4,253) (4,093) (8,114) (8,184)
Payments on long-term debt (376) (289) (597) (656)
Proceeds from issuance of common stock 137 410 991 870
Payments to redeem common stock (9,334) (17,125) (16,433) (17,125)
Dividends paid (6,067) (5,100) (12,037) (9,490)
--------- --------- --------- ---------
Net cash provided by (used in)
financing activities (267,663) 493,638 285,018 646,768
--------- --------- --------- ---------
Net increase (decrease) in cash and due from banks (55,879) 46,183 (79,451) 8,504
Cash and due from banks at beginning of period 394,495 279,264 418,067 316,943
--------- --------- --------- ---------
Cash and due from banks at end of period $ 338,616 $ 325,447 $ 338,616 $ 325,447
========= ========= ========= =========
<CAPTION>
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
(Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
----------------------- -----------------------
(In thousands) 1996 1995 1996 1995
---- ---- ---- ----
<S> <C> <C> <C> <C>
Cash paid (received) for:
Interest $ 54,113 $ 65,933 $105,983 $110,663
Income taxes 21,198 16,043 20,829 17,539
Loans transferred to other real estate owned 56 233 347 233
<CAPTION>
ZIONS BANCORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF RETAINED EARNINGS
(Unaudited)
Six Months Ended Twelve Months Ended
June 30, December 31,
-------------------------- -------------------
(In thousands) 1996 1995 1995
---- ---- ----
<S> <C> <C> <C>
Balance at beginning of period $ 353,179 $ 292,443 $ 292,443
Add:
Net income 48,735 36,522 81,328
--------- --------- ---------
401,914 328,965 373,771
Deduct cash dividends:
Preferred, paid by subsidiary to minority shareholder (18) (20) (38)
Common, per share $ .82 in 1996 and
and $ .65 and $1.41 in 1995 (12,019) (9,470) (20,554)
--------- --------- ---------
Balance at end of period $ 389,877 $ 319,475 $ 353,179
========= ========= =========
</TABLE>
6
<PAGE> 7
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.
Certain amounts in the 1995 consolidated financial statements have been
reclassified to conform to the 1996 presentation. Operating results for the six
months ended June 30, 1996 are not necessarily indicative of the results that
may be expected for the year ended December 31, 1996. 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, 1995.
The Company elected not to adopt the fair value based method of accounting for
its employee stock based Compensation plans established by Statement of
Financial Accounting Standards (Statement) No. 123, "Accounting for Stock-Based
Compensation." Accordingly, the Company will continue its current accounting for
employee stock-based compensation plans in accordance with Accounting Principles
Board Opinion No. 25, as permitted under Statement No. 123, and, if material,
will disclose the pro forma effect of the fair value accounting method in the
notes to its December 31, 1996 consolidated financial statements.
7
<PAGE> 8
ZIONS BANCORPORATION AND SUBSIDIARIES
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
FINANCIAL HIGHLIGHTS
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
------------------------------------ ---------------------------------------
(In thousands, except per share and ratio data) 1996 1995 % Change 1996 1995 % Change
---- ---- -------- ---- ---- --------
<S> <C> <C> <C> <C> <C> <C>
EARNINGS
Net income $ 25,064 $ 20,521 22.1% $ 48,735 $ 36,522 33.4%
PER COMMON SHARE
Net income 1.70 1.39 22.3% 3.31 2.48 33.5%
Dividends .41 .35 17.1% .82 .65 26.2%
Book value at June 30 32.05 26.97 18.8%
Market value at June 30 72.75 50.00 45.5%
Weighted average common and common-
equivalent shares outstanding 14,746,000 14,786,000 14,711,000 14,732,000
Common shares outstanding at June 30 14,772,665 14,543,162
BALANCES AT PERIOD END
Total assets $ 6,087,914 $ 5,664,339 7.5%
Money market investments 386,382 927,646 (58.3)%
Securities 1,942,302 1,594,203 21.8%
Net loans and leases 3,212,191 2,651,732 21.1%
Allowance for loan losses 69,272 67,753 2.2%
Total deposits 4,340,316 3,890,180 11.6%
Shareholders' equity 473,522 392,285 20.7%
Nonperforming assets 8,966 14,527 (38.3)%
Loans past due 90 days or more 5,494 2,688 104.4%
PERFORMANCE RATIOS
Net interest margin 4.57% 4.56% 4.47% 4.61%
Return on average assets 1.62% 1.49% 1.58% 1.37%
Return on average common equity 22.41% 21.13% 22.19% 19.31%
Common dividend payout 24.17% 24.80% 24.66% 25.93%
Nonperforming assets to net loans and leases,
other real estate owned and other
nonperforming assets at June 30 .28% .55%
CAPITAL RATIOS
Average equity to average assets 7.21% 7.05% 7.11% 7.10%
Leverage ratio at June 30 6.45% 6.22%
Tier I risk-based capital at June 30 11.13% 11.40%
Total risk-based capital at June 30 13.82% 14.42%
</TABLE>
8
<PAGE> 9
ZIONS BANCORPORATION AND SUBSIDIARIES
OPERATING RESULTS
Zions Bancorporation achieved record earnings for the quarter and half-year
ended June 30, 1996. Consolidated net income for the second quarter of 1996 was
$25,064,000 or $1.70 per share, an increase of 22.1% and 22.3%, respectively,
over the $20,521,000 or $1.39 earned in the second quarter of 1995 and an
increase of 5.9% and 5.6%, respectively, over the $23,671,000 or $1.61 per share
for the first quarter of 1996.
Consolidated net income was $48,735,000 or $3.31 per share for the first six
months of 1996, compared to $36,522,000 or $2.48 per share for the first six
months of 1995, which constituted increases of 33.4% and 33.5%, respectively.
Earnings during the first six months of 1995 were adversely affected by a
trading loss and restructuring charge totaling $4,390,000 or approximately
$2,948,000 ($.20 per share) after tax. When adjusted for those charges, the
increase in net income and earnings per share for the first six months of 1996
was 23.5%.
The Company's second-quarter $4,543,000 (22.1%) increase in earnings relative to
the same period a year ago reflects a $7,593,000 (13.6%) increase in net
interest income, a $4,421,000 (20.0%) increase in noninterest income, a $90,000
(10.6%) decrease in the provision for loan losses, partially offset by a
$5,558,000 (12.1%) increase in noninterest expenses and a $2,003,000 (18.6%)
increase in income tax expense.
The Company's $9,265,000 (23.5%) increase in net income for the six-month period
ended June 30, 1996 compared to the similar period in 1995, excluding the effect
of the trading loss and restructuring charge, reflect a $14,341,000 (13.1%)
increase in net interest income, a $10,067,000 (23.7%) increase in noninterest
income, a $90,000 (6.2%) decrease in the provision for loan losses, partially
offset by a $10,492,000 (11.6%) increase in noninterest expenses and a
$4,741,000 (23.7%) increase in income tax expense.
The annualized return on average assets for the second quarter and for the first
six months of 1996 was 1.62% and 1.58% compared to 1.49% and 1.37%,
respectively, in 1995, resulting in an annualized return on average common
shareholders' equity of 22.41% and 22.19% for the second quarter and for the
first six months of 1996, compared to 21.13% and 19.31% for the same periods of
1995.
9
<PAGE> 10
ZIONS BANCORPORATION AND SUBSIDIARIES
NET INTEREST INCOME AND INTEREST RATE SPREADS
Net interest income for the second quarter of 1996, adjusted to a fully
taxable-equivalent basis, increased 13.7% to $65,071,000 compared to $57,222,000
for the second quarter of 1995, and increased 5.7% from $61,557,000 for the
first quarter of 1996. Net interest margin was 4.57%, compared to 4.56% for the
second quarter of 1995 and 4.36% for the first quarter of 1996. Six-month net
interest income, on a fully taxable-equivalent basis, was $126,628,000 in 1996,
an increase of 13.4% compared to $111,710,000 for the first six months of 1995.
Net interest margin for the first six months of 1996 was 4.47%, compared to
4.61% for the first six months of 1995.
The yield on average earning assets decreased 24 basis points during the second
quarter of 1996 as compared to the second quarter of 1995, and increased 12
basis points from the first quarter of 1996. The average rate paid this quarter
on interest-bearing funds decreased 26 basis points from the second quarter of
1995, and decreased 7 basis points from the first quarter of 1996. Comparing the
first six months of 1996 with 1995, the yield on average earning assets
decreased 28 basis points, while the cost of interest-bearing funds decreased by
15 basis points.
The spread on average interest-bearing funds for the second quarter of 1996 was
3.82%, up from the 3.80% for the second quarter of 1995 and the 3.63% for the
first quarter of 1996. The spread on average interest-bearing funds for the
first six months of 1996 was 3.72% compared with 3.85% for the same period in
1995.
The Company attempts to minimize interest rate movement sensitivity through the
management of interest rate maturities, and to a lesser extent, 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 1996 was $984,000
compared to $80,000 for the first six months of 1995.
The increased level of taxable-equivalent net interest income and the increase
in net interest margin in the second quarter of 1996, compared to the same
period in 1995 and the first quarter of 1996, resulted primarily from the
increase in average loans and leases and decreased activity in security resell
arrangements. The increased level of taxable-equivalent net interest income in
the first six months of 1996, compared to the same period in 1995, resulted
primarily from the increase in average loans and leases. The decrease in net
interest margin resulted primarily from the effect of a decrease in rates on
earning assets; and an increase in rates paid on interest-bearing time deposits,
and increased activity in security resell arrangements during the first four
months of 1996.
10
<PAGE> 11
ZIONS BANCORPORATION AND SUBSIDIARIES
CONSOLIDATED AVERAGE BALANCE SHEETS, YIELDS AND RATES
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, 1996 June 30, 1996
----------------------------------- -----------------------------------
Average Amount of Average Average Amount of Average
(IN THOUSANDS) Balance Interest(1) Rate Balance Interest(1) Rate
---------- ----------- ------- --------- ----------- -------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Money market investments:
Interest-bearing deposits $ 39,574 $ 461 4.69% $ 37,750 $ 899 4.79%
Federal funds sold and security
resell agreements 821,741 11,331 5.55% 943,699 26,273 5.60%
---------- -------- ---------- --------
Total money market investments 861,315 11,792 5.51% 981,449 27,172 5.57%
---------- -------- ---------- --------
Securities:
Held to maturity:
Taxable 1,033,540 16,878 6.57% 984,618 32,565 6.65%
Nontaxable 205,038 4,462 8.75% 200,758 9,019 9.03%
Available for sale:
Taxable 372,853 6,081 6.56% 363,057 11,743 6.50%
Nontaxable 40,544 807 8.01% 40,887 1,610 7.92%
Trading account 133,070 2,033 6.14% 153,716 4,437 5.80%
---------- -------- ---------- --------
Total securities 1,785,045 30,261 6.82% 1,743,036 59,374 6.85%
---------- -------- ---------- --------
Loans:
Loans held for sale 162,468 3,040 7.53% 155,948 5,780 7.45%
Net loans and leases(2) 2,913,644 72,566 10.02% 2,819,737 140,449 10.02%
---------- -------- ---------- --------
Total loans 3,076,112 75,606 9.89% 2,975,685 146,229 9.88%
---------- -------- ---------- --------
Total interest-earning assets $5,722,472 $117,659 8.27% $5,700,170 $232,775 8.21%
-------- --------
Cash and due from banks 332,238 327,594
Allowance for loan losses (68,127) (67,789)
Other assets 252,239 248,594
---------- ----------
Total assets $6,238,822 $6,208,569
---------- ==========
LIABILITIES
Interest-bearing deposits:
Savings and NOW deposits $ 621,181 $ 4,753 3.08% $ 629,117 $ 9,656 3.09%
Money market super NOW deposits 1,732,231 16,498 3.83% 1,663,835 31,472 3.80%
Time deposits under $100,000 667,187 8,714 5.25% 665,527 17,611 5.32%
Time deposits $100,000 or more 164,519 2,443 5.97% 164,001 5,023 6.16%
Foreign deposits 122,418 1,334 4.38% 114,476 2,491 4.38%
---------- -------- ---------- --------
Total interest-bearing deposits 3,307,536 33,742 4.10% 3,236,956 66,253 4.12%
---------- -------- ---------- --------
Borrowed funds:
Securities sold, not yet purchased 88,399 1,290 5.87% 80,197 2,280 5.72%
Federal funds purchased and security
repurchase agreements 1,197,828 14,802 4.97% 1,279,953 31,933 5.02%
FHLB advances and other borrowings:
Less than one year 20,114 312 6.24% 21,207 672 6.37%
Over one year 80,224 1,189 5.96% 82,278 2,498 6.11%
Long-term debt 55,861 1,253 9.02% 56,001 2,511 9.02%
---------- -------- ---------- --------
Total borrowed funds 1,442,426 18,846 5.25% 1,519,636 39,894 5.28%
---------- -------- ---------- --------
Total interest-bearing liabilities $4,749,962 $ 52,588 4.45% $4,756,592 $106,147 4.49%
-------- --------
Noninterest-bearing deposits 927,646 899,852
Other liabilities 111,360 110,416
---------- ----------
Total liabilities 5,788,968 5,766,860
Total shareholders' equity 449,854 441,709
---------- ----------
Total liabilities and shareholders' equity $6,238,822 $6,208,569
---------- ==========
Spread on average interest-bearing funds 3.82% 3.72%
==== ====
Net interest income and net yield on
interest-earning assets $ 65,071 4.57% $126,628 4.47%
======== ==== ======== ====
</TABLE>
(1) Taxable-equivalent rates used where applicable.
(2) Net of unearned income and fees, net of related costs. Loans include
nonaccrual and restructured loans.
11
<PAGE> 12
ZIONS BANCORPORATION AND SUBSIDIARIES
CONSOLIDATED AVERAGE BALANCE SHEETS, YIELDS AND RATES
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, 1995 June 30, 1995
---------------------------------- -----------------------------------
Average Amount of Average Average Amount of Average
(In thousands) Balance Interest(1) Rate Balance Interest(1) Rate
---------- ----------- ------- ---------- ------------ -------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Money market investments:
Interest-bearing deposits $ 24,659 $ 283 4.60% $ 22,595 $ 511 4.56%
Federal funds sold and security
resell agreements 917,226 13,789 6.03% 801,123 23,556 5.93%
---------- -------- ---------- --------
Total money market investments 941,885 14,072 5.99% 823,718 24,067 5.89%
---------- -------- ---------- --------
Securities:
Held to maturity:
Taxable 926,031 16,337 7.08% 906,067 31,841 7.09%
Nontaxable 207,875 4,413 8.51% 205,376 8,707 8.55%
Available for sale:
Taxable 345,392 5,743 6.67% 340,765 11,386 6.74%
Nontaxable - - -% - - -%
Trading account 74,452 1,051 5.66% 135,295 4,676 6.97%
---------- -------- ---------- --------
Total securities 1,553,750 27,544 7.11% 1,587,503 56,610 7.19%
---------- -------- ---------- --------
Loans:
Loans held for sale 104,174 2,180 8.39% 103,919 4,308 8.36%
Net loans and leases(2) 2,431,446 62,965 10.39% 2,372,807 120,842 10.27%
---------- -------- ---------- --------
Total loans 2,535,620 65,145 10.31% 2,476,726 125,150 10.19%
---------- -------- ---------- --------
Total interest-earning assets $5,031,255 $106,761 8.51% $4,887,947 $205,827 8.49%
-------- --------
Cash and due from banks 321,933 316,150
Allowance for loan losses (67,662) (67,448)
Other assets 242,899 233,159
---------- ----------
Total assets $5,528,425 $5,369,808
========== ==========
LIABILITIES
Interest-bearing deposits:
Savings and NOW deposits $ 720,053 $ 5,681 3.16% $ 735,079 $ 11,450 3.14%
Money market and super NOW deposits 1,401,160 14,976 4.29% 1,370,888 28,712 4.22%
Time deposits under $100,000 607,372 7,738 5.11% 573,749 13,823 4.86%
Time deposits $100,000 or more 101,752 1,482 5.84% 101,989 2,760 5.46%
Foreign deposits 135,859 1,820 5.37% 143,856 3,821 5.36%
---------- -------- ---------- --------
Total interest-bearing deposits 2,966,196 31,697 4.29% 2,925,561 60,566 4.17%
---------- -------- ---------- --------
Borrowed funds:
Securities sold, not yet purchased 40,077 465 4.65% 86,896 2,741 6.36%
Federal funds purchased and security
repurchase agreements 1,032,163 14,228 5.53% 896,795 24,411 5.49%
FHLB advances and other borrowings:
Less than one year 24,485 322 5.27% 22,359 644 5.81%
Over one year 95,614 1,571 6.59% 97,502 3,171 6.56%
Long-term debt 57,696 1,256 8.73% 57,840 2,584 9.01%
---------- -------- ---------- --------
Total borrowed funds 1,250,035 17,842 5.72% 1,161,392 33,551 5.83%
---------- -------- ---------- --------
Total interest-bearing liabilities $4,216,231 $ 49,539 4.71% $4,086,953 $ 94,117 4.64%
-------- --------
Noninterest-bearing deposits 811,853 799,678
Other liabilities 110,707 101,674
---------- ----------
Total liabilities 5,138,791 4,988,305
Total shareholders' equity 389,634 381,503
---------- ----------
Total liabilities and shareholders' equity $5,528,425 $5,369,808
========== ==========
Spread on average interest-bearing funds 3.80% 3.85%
==== ====
Net interest income and net yield on
interest-earning assets $ 57,222 4.56% $111,710 4.61%
======== ==== ======== ====
</TABLE>
(1) Taxable-equivalent rates used where applicable.
(2) Net of unearned income and fees, net of related costs. Loans include
nonaccrual and restructured loans.
12
<PAGE> 13
ZIONS BANCORPORATION AND SUBSIDIARIES
PROVISION FOR LOAN LOSSES
The provision for loan losses decreased 10.6% to $760,000 for the second quarter
of 1996, as compared with $850,000 for the second quarter of 1995, and increased
26.7% from the $600,000 for the first quarter of 1996. Net charge-offs for the
second quarter of 1996 were $1,679,000 or .11% of average net loans and leases,
compared to net charge-offs of $718,000 or .06% of average net loans and leases
for the second quarter of 1995, and net charge-offs of $530,000, or .07% of
average net loans and leases for the first quarter of 1996. The provision for
loan losses for the first six months of 1996 totaled $1,360,000, 6.2% less than
the $1,450,000 provision for the first six months of 1995. Net charge-offs for
the first six months of 1996 were $2,209,000 or .15% of average net loans and
leases, compared to $964,000 or .08% of average net loans and leases for the
first six months of 1995.
NONINTEREST INCOME
Noninterest income for the second quarter of 1996 totaled $26,526,000, an
increase of 20.0% from the $22,105,000 for the second quarter of 1995 and an
increase of 1.7% over the $26,077,000 for the first quarter of 1996. Comparing
the segments of noninterest income for the second quarter of 1996 and the second
quarter of 1995, service charges on deposit accounts; other service charges,
commissions and fees; and trust income increased 14.3%, 5.1% and 15.4%,
respectively, while loan sales and servicing income increased 34.0% and other
income increased 10.7%. Net gains of $68,000 on the sale of investment
securities was realized during the second quarter of 1996 compared to net gains
of $52,000 during the second quarter of 1995, and trading account income during
the second quarter 1996 increased $641,000 over the trading account income
reported in the second quarter of 1995.
Noninterest income for the six months ending June 30, 1996 totaled $52,603,000
compared to $39,446,000 for the first six months of 1995, an increase of 23.7%
after adjusting for the $3,090,000 trading loss recorded in the first quarter of
1995. Comparing the segments of noninterest income for the first six months of
1996 and the first six months of 1995, service charges on deposit accounts;
other service charges, commissions and fees; and trust income increased 12.8%,
15.3% and 17.0%, respectively, while loan sales and servicing income increased
33.4% and other income increased 26.0%. The increase in other income was
primarily an increase in income from mortgage servicing released premiums on the
sale of first mortgage loans. Net gains of $70,000 on the sale of investment
securities was realized during the first six months of 1996 compared to $53,000
of net losses during the first six months of 1995, and trading account income
during the first six months of 1996 increase $1,361,000 over the adjusted
trading account loss reported in the first six months of 1995.
13
<PAGE> 14
ZIONS BANCORPORATION AND SUBSIDIARIES
NONINTEREST EXPENSES
Noninterest expenses for the second quarter of 1996, totaling $51,440,000,
increased 12.1% from the $45,882,000 for the second quarter of 1995, and
increased 3.4% from the $49,752,000 for the first quarter of 1996. Comparing the
noninterest expense segments for the second quarter of 1996 and the second
quarter of 1995, salaries and employee benefits increased 14.4%, occupancy,
furniture and equipment expenses increased 12.3%, advertising increased 19.8%,
FDIC premiums decreased 99.9% and the total of all other expenses increased
24.8%.
Noninterest expenses for the six months ending June 30, 1996 totaled
$101,192,000 as compared to $92,000,000 for the first six months of 1995, an
increase of 11.6% after adjusting for the $1,300,000 restructuring charge
recorded in the first quarter of 1995. Comparing the noninterest expense
segments for the first six months of 1996 and the first six months of 1995,
salaries and employee benefits increased 14.6%, occupancy, furniture and
equipment expenses increased 12.8%, advertising increased 29.0%, FDIC premiums
decreased 99.8% and the total of all other expenses increased 15.1%.
Salaries and employee benefits increased primarily as a result of increased
staffing of branch offices opened and acquired and SBA loan origination
activities, as well as general salary increases, bonuses, commissions and
profit-sharing costs related to increased profitability. The occupancy,
furniture and equipment expense increase resulted primarily from the addition of
branch facilities, the further expansion of the ATM network, and the
installation of personal computers and local area networks. The increase in all
other expenses resulted primarily from increases in supplies, postage, and
telecommunication expenses related to acquisition and expansion. At June 30,
1996, the Company had 3,021 full-time equivalent employees, 138 offices and 271
ATMs compared to 2,731 full-time equivalent employees, 123 offices and 242 ATMs
at June 30, 1995. The Company's "efficiency ratio," or noninterest expenses as a
percentage of total taxable-equivalent net revenues, improved to 56.5% for the
first six months of 1996 from 60.9% for the first six months of 1995.
INCOME TAXES
The Company's income taxes increased 18.6% to $12,752,000 for the second quarter
of 1996 compared to $10,749,000 for the second quarter of 1995, and $12,003,000
for the first quarter of 1996. The Company's income taxes were $24,755,000 for
the first six months of 1996 as compared to $18,572,000 for the first six months
of 1995, an increase of 23.7% after adjusting $1,442,000 for estimated income
taxes related to the 1995 trading loss and restructuring charge. The increase in
the Company's income taxes was due to the increase in income before income
taxes.
ANALYSIS OF FINANCIAL CONDITION
EARNING ASSETS
Average earning assets increased 16.6% to $5,700.2 million in the six months
ended June 30, 1996 compared to $4,887.9 million in the six months ended June
30, 1995. Earning assets comprised 91.8% of total average assets for the first
six months of 1996, compared with 91.0% for the first six months of 1995.
14
<PAGE> 15
ZIONS BANCORPORATION AND SUBSIDIARIES
Average money market investments, consisting of interest-bearing deposits,
federal funds sold and security resell agreements increased 19.1% to $981.4
million in the first six months of 1996 compared to $823.7 million in the first
six months of 1995.
During the first six months of 1996, average securities increased 9.8% to
$1,743.0 million compared to $1,587.5 million in the first six months of 1995.
Average held to maturity securities increased 6.7%, available for sale
securities increased 18.5% and trading account securities increased 13.6%
compared with the first six months of 1995.
Average net loans and leases increased 20.1% to $2,975.7 million in the first
six months of 1996 compared to $2,476.7 million in the first six months of 1995,
representing 52.2% of earning assets in the first six months of 1996 compared to
50.7% in the first six months of 1995. Average net loans and leases were 71.9%
of average total deposits for the six months ended June 30, 1996, as compared to
66.5% for the six months ended June 30, 1995.
INVESTMENT SECURITIES
The following table presents the Company's investment securities at June 30,
1996, December 31, 1995 and June 30, 1995.
<TABLE>
<CAPTION>
June 30, December 31, June 30,
1996 1995 1995
------------------------ ------------------------ ------------------------
Amortized Market Amortized Market Amortized Market
(In thousands) cost value cost value cost value
---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Held to maturity
U.S. government agencies and corporations:
Small Business Administration
loan-backed securities $ 507,269 $ 516,906 $ 529,376 $ 541,014 $ 469,298 $ 472,406
Other agency securities 527,268 520,269 265,430 263,522 350,869 348,825
States and political subdivisions 243,955 245,417 225,231 230,149 264,329 268,569
---------- ---------- ---------- ---------- ---------- ----------
1,278,492 1,282,592 1,020,037 1,034,685 1,084,496 1,089,800
Mortgage-backed securities 57,357 57,875 58,546 59,249 55,341 55,773
---------- ---------- ---------- ---------- ---------- ----------
$1,335,849 $1,340,467 $1,078,583 $1,093,934 $1,139,837 $1,145,573
---------- ---------- ---------- ---------- ---------- ----------
Available for sale
U.S. Treasury securities $ 16,669 $ 16,677 $ 17,691 $ 17,728 $ 41,881 $ 41,737
U.S. government agencies 118,726 117,903 71,038 70,952 99,764 98,713
States and political subdivisions 39,543 40,694 40,153 42,084 -- --
---------- ---------- ---------- ---------- ---------- ----------
174,938 175,274 128,882 130,764 141,645 140,450
---------- ---------- ---------- ---------- ---------- ----------
Mortgage-backed securities 66,741 65,886 69,469 69,333 49,781 49,734
---------- ---------- ---------- ---------- ---------- ----------
Equity securities:
Mutual funds:
Accessor Funds, Inc. 108,979 107,597 118,899 119,971 118,863 117,525
Other 579 579 564 564 548 548
Stock:
Federal Home Loan Bank 75,009 75,009 71,988 71,988 69,511 69,511
Other 6,489 6,849 5,386 5,580 3,167 3,281
---------- ---------- ---------- ---------- ---------- ----------
191,056 190,034 196,837 198,103 192,089 190,865
---------- ---------- ---------- ---------- ---------- ----------
$ 432,735 $ 431,194 $ 395,188 $ 398,200 $ 383,515 $ 381,049
---------- ---------- ---------- ---------- ---------- ----------
Total $1,768,584 $1,771,661 $1,473,771 $1,492,134 $1,523,352 $1,526,622
========== ========== ========== ========== ========== ==========
</TABLE>
15
<PAGE> 16
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,
1996, December 31, 1995 and June 30, 1995.
<TABLE>
<CAPTION>
June 30, December 31, June 30,
(In thousands) 1996 1995 1995
----- ---- ----
<S> <C> <C> <C>
Types
Loans held for sale $ 166,967 $ 126,124 $ 110,768
Commercial, financial, and agricultural 765,504 688,466 641,194
Real estate:
Construction 335,532 268,812 210,428
Other 1,505,160 1,272,633 1,155,083
Consumer 322,357 341,150 426,343
Lease financing 144,969 132,520 125,820
Other receivables 6,989 8,203 8,432
---------- ---------- ----------
Total loans $3,247,478 $2,837,908 $2,678,068
========== ========== ==========
</TABLE>
Loans held for sale at June 30, 1996 increased 32.4% from year-end 1995. All
other loans, net of unearned income and fees increased 13.6% to $3,045.2 million
at June 30, 1996, compared to $2,680.8 million at December 31, 1995. Commercial
loans, construction loans, other real estate-secured loans, and lease financing
increased from year end 11.2%, 24.8%, 18.3% and 9.4%, respectively, as consumer
loans decreased 5.5% and other receivables decreased 14.8%. Within the other
real estate-secured loan portfolio, home equity credit line loans increased
11.6% to $101.2 million, 1-4 family residential loans increased 21.0% to $508.9
million and all other real estate loans increased 17.6% to $895.1 million at
June 30, 1996. During the first six months of 1996, the Company securitized and
sold home equity credit line receivables totaling $94.3 million, SBA 504 loans
totaling $21.4 million, credit card receivables totaling $116.8 million, and
automobile loans totaling $142.3 million.
16
<PAGE> 17
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 $8,966,000 at June 30, 1996 down 3.5% from $9,296,000 at December 31, 1995,
and down 38.3% from $14,527,000 at June 30, 1995. Such nonperforming assets as a
percentage of net loans and leases, other real estate owned and other
nonperforming assets were .28%, .33% and .55% at June 30, 1996, December 31,
1995, and June 30, 1995, respectively.
Accruing loans past due 90 days or more totaled $5,494,000 at June 30, 1996, up
from $5,232,000 at December 31, 1995, and up from $2,688,000 at June 30, 1995.
These loans equaled .17% of net loans and leases at June 30, 1996, as compared
to .19% at December 31, 1995 and .10% at June 30, 1995.
Loans to one borrower totaling $1,275,000 at June 30, 1996 were considered
potential problem loans compared to no loans at December 31, 1996 and June 30,
1995. 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, 1996,
December 31, 1995, and June 30, 1995.
<TABLE>
<CAPTION>
June 30, December 31, June 30,
(In thousands) 1996 1995 1995
---- ---- ----
<S> <C> <C> <C>
Nonaccrual loans $ 8,501 $ 7,438 $10,981
Restructured loans 206 249 256
Other real estate owned and other
nonperforming assets 259 1,609 3,290
------- ------- -------
Total $ 8,966 $ 9,296 $14,527
======= ======= =======
% of net loans and leases*, other real estate
owned and other nonperforming assets .28% .33% .55%
Accruing loans past due 90 days or more $ 5,494 $ 5,232 $ 2,688
======= ======= =======
% of net loans and leases* .17% .19% .10%
</TABLE>
*Includes loans held for sale
The Company's total recorded investment in impaired loans, in accordance with
Financial Accounting Standard statements, amounted to $4,642,000 at June 30,
1996, as compared to $3,388,000 as of December 31, 1995, and $6,589,000 at June
30, 1995. The company considers a loan to be impaired when the accrual of
interest has been discontinued and meets other criteria under the statements.
The amount of the impairment is measured based on the present value of expected
cash flows, the observable market price of the loan, or the fair value of the
collateral. Impairment losses are included in the allowance for loan losses
through a provision for loan losses. The required allowance for loan losses
allocated to impaired loans as of June 30, 1996, December 31, 1995 and June 30,
1995 amounts to $34,000, $22,000 and $1,055,000, respectively.
17
<PAGE> 18
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
June 30, December 31,
------------------------------- -------------
(In thousands) 1996 1995 1995
---- ---- ----
<S> <C> <C> <C>
Average loans* and leases outstanding
(net of unearned income) $ 2,975,685 $ 2,476,726 $ 2,599,071
=========== =========== ===========
Allowance for possible losses:
Balance at beginning of the period $ 67,555 $ 67,018 $ 67,018
Allowance of companies acquired 2,566 249 249
Loans and leases charged-off:
Loans held for sale -- -- --
Commercial, financial and agricultural (574) (422) (997)
Real estate (393) (128) (548)
Consumer (3,991) (3,411) (6,786)
Lease financing (172) (5) (41)
Other receivables -- -- --
----------- ----------- -----------
Total (5,130) (3,966) (8,372)
----------- ----------- -----------
Recoveries:
Loans held for sale -- -- --
Commercial, financial and agricultural 1,029 1,291 2,580
Real estate 302 190 464
Consumer 1,212 1,249 2,540
Lease financing 378 272 276
Other receivables -- -- --
----------- ----------- -----------
Total 2,921 3,002 5,860
----------- ----------- -----------
Net loan and lease charge-offs (2,209) (964) (2,512)
Provision charged against earnings 1,360 1,450 2,800
----------- ----------- -----------
Balance at end of the period $ 69,272 $ 67,753 $ 67,555
=========== =========== ===========
*Includes loans held for sale
Ratio of net charge-offs to
average loans and leases .15% .08% .10%
</TABLE>
18
<PAGE> 19
ZIONS BANCORPORATION AND SUBSIDIARIES
The allowance for loan losses as a percentage of net loans and leases was 2.16%
at June 30, 1996, compared to 2.41% at December 31, 1995, and 2.56% at June 30,
1995. The allowance, as a percentage of nonaccrual loans and accruing loans past
due 90 days or more was 495.0% at June 30, 1996, compared to 533.2% at December
31, 1995, and 495.7% at June 30, 1995. The allowance, as a percentage of
nonaccrual loans and restructured loans was 795.6% at June 30, 1996, compared to
878.8% at December 31, 1995, and 602.9% at June 30, 1996.
Included in the allowance for loan losses is an amount for unused loan
commitments and standby letters of credit which at June 30, 1996, December 31,
1995, and June 30, 1995, amounted to $5,797,000, $7,516,000 and $5,332,000,
respectively. Unused loan commitments and standby letters of credit at June 30,
1996, December 31, 1995, and June 30, 1995, amounted to $1,512.9 million,
$1,610.5 million ad $1,374.7 million, respectively.
DEPOSITS
Average total deposits of $4,136.8 million of the first six months of 1996
increased 11.0% over the $3,725.2 million for the first six months of 1995, with
average demand deposits increasing 12.5%. Average money market and super NOW
deposits, time deposits under $100,000 and time deposits over $100,000 for the
first six months of 1996 increased 21.4%, 16.0% and 60.8% respectively, from the
first six months of 1995. Average savings and NOW deposits decreased 14.4% and
foreign deposits decreased 20.4% during the first six months of 1996, as
compared with the same period one year earlier.
Total deposits increased 5.9% to $4,340.3 million at June 30, 1996 as compared
to $4,097.1 million at December 31, 1995. Comparing June 30, 1996 to December
31, 1995, demand deposits, savings and money market deposits, time deposits
under $100,000, and time deposits over $100,000 increased .2%, 10.6%, .5% and
14.5%, respectively, while foreign deposits decreased 14.1%.
LIQUIDITY AND INTEREST RATE SENSITIVITY
The Company manages it liquidity to provide adequate funds to meet its financial
obligations, including withdrawals by depositors, debt service requirements and
operating needs. 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 or "purchased" liabilities and
wholesale deposits, totaled $1,254.4 million or 30.8% of core deposits at June
30, 1996, as compared to $1,428.2 million or 37.3% of core deposits at December
31, 1995, and $1,387.7 million or 37.9% of core deposits at June 30, 1995. The
Company's core deposits, consisting of demand, saving and money market deposits
and time deposits under $100,000, constituted 93.7% of total deposits at June
30, 1996 as compared to 93.5% at December 31, 1995 and 94.1% at June 30, 1995.
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.
19
<PAGE> 20
ZIONS BANCORPORATION AND SUBSIDIARIES
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 current income taxes.
Interest rate sensitivity measures the Company's financial exposure to changes
in interest rates. Interest rate sensitivity is, like liquidity, affected by
maturities of assets and liabilities. Interest rate sensitivity is measured in
terms of "gaps," defined as the difference between volumes of assets and
liabilities whose interest rates are subject to reset within specified periods
of time, and "duration," a measure of the weighted average expected lives of the
cash flows from assets and liabilities.
The Company, through the management of interest rate "maturities" and the use of
off-balance sheet arrangements such as interest rate caps, floors, futures,
options, and interest rate exchange agreements, attempts to minimize the effect
on net income of changes in interest rates. The Company's management exercises
its best judgment in making assumptions with respect to prepayments, early
withdrawals and other noncontrollable events in managing the Company's exposure
to changes in interest rates. Gaps are actively managed and change daily as the
interest rate environment changes; therefore, positions at the end of any period
may not be reflective of the Company's interest rate position in subsequent
periods. The prime lending rate is the primary basis used for pricing the
Company's loans and the short-term Treasury rate is the index used for pricing
many of the Company's deposits. The Company, however, is unable to effectively
and economically hedge the prime/90-day T-bill spread risk through the use of
off-balance sheet financial instruments.
CAPITAL RESOURCES AND DIVIDENDS
During the first six months of 1996, the Company repurchased and retired 218,997
shares of its common stock at a cost of $16,433,000.
Total shareholders' equity at June 30, 1996 was $473.5 million, an increase of
10.5% over the $428.5 million at December 31, 1995, and an increase of 20.7%
over the $392.3 million at June 30, 1995. The ratio of average equity to average
assets for the first six months of 1996 was 7.11%, compared to 7.10% for the
same period in 1995. At June 30, 1996, the Company's Tier I risk-based capital
ratio was 11.13%, as compared to 11.38% at December 31, 1995 and 11.40% at June
30, 1995. At June 30, 1996 the Company's total risk-based capital ratio was
13.82%, as compared to 14.23% at December 31, 1995 and 14.42% at June 30, 1995.
The Company's leverage ratio as of June 30, 1996 was 6.45%, as compared to 6.28%
at December 31, 1995 and 6.22% at June 30, 1995.
Dividends declared per common share for the second quarter of 1996 of $.41
increased 17.1%, as compared to $.35 for the second quarter of 1995. Dividends
declared per common share of $.82 for the first six months of 1996 increased
26.2% compared to $.65 for the first six months of 1995. The cash dividend
payout to net income applicable to common shares of the first six months of 1996
was 24.7%, compared to 25.9% for the first six months of 1995.
20
<PAGE> 21
ZIONS BANCORPORATION AND SUBSIDIARIES
MERGERS AND ACQUISITIONS
At the close of business May 31, 1996, the purchase transaction of Zions
Bancorporation and Southern Arizona Bancorp, Inc. and it's banking subsidiary,
Southern Arizona Bank, was consummated at a purchase price of $26.2 million,
paid through the exchange of Zions Bancorporation common stock for Southern
Arizona Bancorp, Inc. Stock. Southern Arizona Bank was merged into Zions
Bancorporation's wholly owned subsidiary, National Bank of Arizona providing
expanded banking services in Yuma, Arizona.
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 26, 1996.
b) Election of Directors
Proxies were solicited 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>
Jerry C. Atkin 11,928,946 30,183
Grant R. Caldwell 11,924,698 34,431
Roy W. Simmons 11,926,805 32,324
Dale W. Westergard 11,923,754 35,375
</TABLE>
(2) Approve Zions Bancorporation
Nonemployee directors Stock
Option Plan
Approval of 100,000 shares to be set aside for and be
issuable under the Plan, and the approval of the term
of the Plan to April 26, 2005.
<TABLE>
<CAPTION>
For Against Abstain
--- ------- -------
<S> <C> <C>
11,418,134 434,066 106,929
</TABLE>
21
<PAGE> 22
ZIONS BANCORPORATION AND SUBSIDIARIES
PART II. OTHER INFORMATION
(3) Appointment of Independent Accountants
The selection of KPMG Peat Marwick LLP 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, 1996 was ratified.
<TABLE>
<CAPTION>
For Against Abstain
--- ------- -------
<S> <C> <C> <C>
11,912,742 10,202 36,185
</TABLE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a) Exhibits
Exhibit 10 Zions Bancorporation Non-Employee Directors Stock
Option Plan
Exhibit 27 Article 9 Financial Schedules for Form 10-Q
b) Reports on Form 8-K
There were no reports on Form 8-K filed during the quarter
ending June 30, 1996.
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 6, 1996
22
<PAGE> 1
ZIONS BANCORPORATION EXHIBIT 10
1996 NON-EMPLOYEE DIRECTORS
STOCK OPTION PLAN
SECTION 1
PURPOSE OF THE PLAN
The Zions Bancorporation Stock Option Plan for Non-Employee Directors
(the "PLAN") is intended to provide a method whereby the non-employee voting
directors (the "DIRECTORS") of Zions Bancorporation (the "COMPANY"), who are
responsible for reviewing and monitoring the performance of the Company and the
performance of the Company's officers, may be encouraged to acquire a stock
ownership in the Company, thereby promoting the interests of the Company and all
its stockholders. Accordingly, the Company, during the term of the Plan, will
grant options to the Directors to purchase shares of the Company's common stock,
subject to the conditions hereinafter provided.
SECTION 2
ADMINISTRATION OF THE PLAN
2.1. The Plan shall be administered by the Pension and Benefits
Committee (the "COMMITTEE") which consists of officers of the Company. The
Committee shall keep records of action taken at its meetings.
2.2. The Committee shall interpret the Plan and prescribe such rules,
regulations and procedures in connection with the operation of the Plan as it
shall deem to be necessary and advisable for the administration of the Plan
consistent with the purposes and terms of the Plan. All questions of
interpretation and application of the Plan, or as to options granted under the
Plan, shall be subject to the determination of the Committee, which shall be
final and binding.
<PAGE> 2
2.3. Notwithstanding the above, the selection of the Directors to whom
options are to be granted, the timing of such grants, the number of shares
subject to any option, the exercise price of any option, the periods during
which any option may be exercised and the term of any option shall be as
hereinafter provided, and the Committee shall have no discretion as to such
matters.
2.4. Notwithstanding anything contained herein to the contrary, no
member of the Committee shall be eligible to receive options granted under the
Plan.
SECTION 3
ELIGIBILITY OF GRANTEES
3.1. Options shall be granted only to voting Directors of the Company
who are not currently serving as employees of the Company or any its affiliates.
3.2. Nothing in the Plan, in any option granted under the Plan, or in
any option agreement shall confer any right to any person to continue as a
Director of the Company or interfere in any way with the rights of the
stockholders of the Company or the Company's Board of Directors (the "BOARD") to
elect and remove Directors.
SECTION 4
STOCK AVAILABLE UNDER THE PLAN
4.1. The stock to be issued upon exercise of options granted under the
Plan shall be the Company's common stock, without par value ("COMMON STOCK"),
that shall be made available either from authorized but unissued Common Stock or
from Common Stock reacquired by the Company, including shares purchased in the
open market. The aggregate number of shares of Common Stock that may be issued
under options granted pursuant to the Plan shall not exceed One Hundred Thousand
- 2 -
<PAGE> 3
(100,000) shares. The limitations established by the preceding sentence shall be
subject to adjustment as provided in Section 11 of the Plan.
4.2. If any option granted under the Plan is canceled by mutual consent
or terminates or expires for any reason without having been exercised in full,
the shares of Common Stock allocable to the unexercised portion of such option
may again be made subject to options under the Plan.
4.3. The Common Stock which will be issued upon exercise of an option
granted hereunder shall be restricted stock, i.e., Common Stock which has not
been registered with the Securities and Exchange Commission.
SECTION 5
TYPE OF OPTION
Only "nonstatutory stock options" shall be granted under the terms of
the Plan. For purposes of the Plan, the term "nonstatutory stock options" shall
mean an option which does not qualify under Section 422 or 423 of the Internal
Revenue Code of 1986, as amended.
SECTION 6
GRANT OF OPTION
6.1. All Directors shall receive the first grant of Options pursuant to
this Plan the first business day after the date such Plan is initially approved
by the Company's stockholders. Thereafter, all Directors shall receive options
each year on the first business day following the day of the Annual Meeting of
Stockholders of the Company.
6.2. Each Director shall receive, on an annual basis, an option to
purchase One Thousand (1,000) shares of the Company's Common Stock, subject to
adjustment only as provided in Section 11
- 3 -
<PAGE> 4
of the Plan. If the number of shares then remaining available for the grant of
options under the Plan is not sufficient for each Director to be granted an
option for One Thousand (1,000) shares (or the number of adjusted shares
pursuant to Section 11), then each Director shall be granted an option for a
number of whole shares equal to the number of shares then remaining available
divided by the number of Directors, disregarding any fractions of a share.
6.3. Each annual grant of an option shall vest and become exercisable
in four equal installments of Two Hundred Fifty (250) shares beginning six
months from the grant date and continuing at one-year intervals from the first
vesting date.
6.4. Subject to Section 9, each option shall be exercisable for ten
(10) years from the date of grant and not thereafter. An option, to the extent
exercisable at any time, may be exercised in whole or in part.
6.5. All options shall be confirmed by an agreement, or an amendment
thereto, which shall be executed on behalf of the Company by the Chief Executive
Officer (if other than the President) or the President, and by the grantee.
SECTION 7
OPTION PRICE
7.1. The option price per share shall be One Hundred percent (100%) of
the "fair market value" of one share of Common Stock on the date the option is
granted (the "OPTION PRICE").
7.2. As used in this Plan, the term "FAIR MARKET VALUE" shall be deemed
to be the closing price of the Company's Common Stock as reported on the
National Association of Securities Dealers Automated Quotations System (or the
principal United States securities exchange registered under the
- 4 -
<PAGE> 5
Securities Exchange Act of 1934 on which the Common Stock is listed at the time)
("NASDAQ") on the date the option is granted. If there is not a NASDAQ closing
price quotation for the date as of which fair market value is to be determined,
then the fair market value shall be determined by reference to the NASDAQ
closing price quotation for the next preceding day on which a closing price
quotation is reported by NASDAQ.
7.3. The Option Price shall be subject to adjustment only as provided
in Section 11 of the Plan.
SECTION 8
EXERCISE OF OPTIONS
8.1. A Director electing to exercise an option shall give written
notice to the Company of such election and of the number of shares he has
elected to purchase, in such form as the Committee shall have prescribed or
approved, and shall at the time of exercise tender the full Option Price of the
shares he has elected to purchase.
8.2. The Option Price shall be paid in full upon exercise and shall be
payable in cash in United States dollars (including check, bank draft or money
order); provided, however, that in lieu of cash, the person exercising the
option may pay the Option Price in whole or in part by delivering to the Company
shares of the Common Stock owned by him and having a fair market value on the
date of exercise equal to the cash Option Price applicable to his option, except
that (i) any portion of the Option Price representing a fraction of a share
shall in any event be paid in cash and (ii) no shares of the Common Stock which
have been held for less than six (6) months may be delivered in payment of the
- 5 -
<PAGE> 6
Option Price of an option. Delivery of shares may also be accomplished through
the effective transfer to the Company of shares held by a broker or other agent.
8.3. Notwithstanding the provisions of Section 8.2 above, the exercise
of the option shall not be deemed to occur and no shares of Common Stock will be
issued by the Company upon exercise of the option until the Company has received
payment of the Option Price in full.
8.4. A grantee shall have no rights as a stockholder with respect to
any shares covered by his option(s) until the date a stock certificate is issued
evidencing ownership of the shares. No adjustments shall be made for dividends
(ordinary or extraordinary), whether in cash, securities or other property, or
distributions or other rights, for which the record date is prior to the date
such stock certificate is issued, except as provided in Section 11 hereof.
8.5. Payment of the option price with shares of Common Stock shall not
increase the number of shares of Common Stock which may be issued under the Plan
as provided in Section 4 above.
8.6. Notwithstanding any provision of the Plan or any provision or
limitation in any option to the contrary, if the Company obtains actual
knowledge of a "change of control of the Company" (as defined below), then all
outstanding options held by grantees who, at the time of exercise are Directors,
may be exercised with respect to all shares of Common Stock subject thereto at
any time during the period of ninety (90) days following the date upon which the
Company obtained actual knowledge of such change of control of the Company. As
used herein, a "CHANGE OF CONTROL OF THE COMPANY" shall be deemed to have
occurred if (i) any person (as such term is used in Section 13(d) and 14(d) of
the Securities Exchange Act of 1934 (the "ACT")) is or becomes the beneficial
owner (as such term is used in Rule 13d-3 under the Act) of securities of the
Company representing 20% or more of the combined
- 6 -
<PAGE> 7
voting power of the Company, or (ii) the stockholders of the Company approve (A)
a plan of merger or consolidation of the Company (unless, immediately following
consummation of such merger or consolidation, the persons who held the Company's
voting securities immediately prior to consummation thereof will hold at least a
majority of the total voting power of the surviving or new corporation), or (B)
a sale or disposition of all or substantially all assets of the Company, or (C)
a plan of liquidation or dissolution of the Company.
SECTION 9
RESTRICTIONS ON TRANSFERABILITY OF OPTIONS
9.1. No option shall be transferable by the grantee otherwise than by
Will, or if the Grantee dies intestate, by the laws of descent and distribution
of the state of domicile of the grantee at the time of death. All options shall
be exercisable during the lifetime of the grantee only by the grantee or the
grantee's guardian, conservator or legal representative. These restrictions on
transferability shall not apply to the extent such restrictions are not at the
time required for the Plan to continue to meet the requirements of Rule 16b-3 of
the Act, or any successor Rule.
9.2. If a grantee ceases to be a Director of the Company for any
reason, any outstanding options held by the grantee shall be exercisable
according to the following provisions:
9.2.1. If a grantee ceases to be a Director of the Company for any
reason other than disability or death, any outstanding options held by such
grantee shall terminate as of the date on which the grantee ceases to be a
Director;
9.2.2. If, during his term of office as a Director, a grantee dies
or becomes unable to serve as a Director due to physical and/or mental
disability, any outstanding options held by the grantee,
- 7 -
<PAGE> 8
which are exercisable by the grantee immediately prior to his death or
disability, shall be exercisable by the grantee's guardian, conservator or legal
representative, or by the person entitled to do so under the Will of the
grantee, or, if the grantee shall fail to make testamentary disposition of the
options or shall die intestate, by the legal representative of the grantee's
estate, at any time prior to the expiration date of such options or within one
(1) year after the date of the grantee's disability or death, whichever period
is longer.
SECTION 10
AMENDMENT OR TERMINATION OF THE PLAN
The Board may at any time terminate, annul, modify or suspend the Plan,
subject to the following conditions:
10.1. No termination of the Plan shall terminate any outstanding
options granted under the Plan.
10.2. The Board cannot amend the Plan more often than once per
six-month period except for amendments to comply with changes in federal tax and
ERISA laws and the rules thereunder.
10.3. No amendment of the Plan shall be made without stockholder
approval if stockholder approval of the amendment is at the time required for
options under the Plan to qualify for the exemption from Section 16(b) of the
Act provided by Rule 16b-3, or any successor Rule, or by the rules of any stock
exchange on which the Common Stock may then be listed.
10.4. The Board cannot amend, modify, suspend, or terminate the Plan in
such a way that affects any options previously granted under the Plan without
the consent of the grantee.
10.5. Without the approval of the stockholders of the Company, no
amendment or modification shall be made by the Board that:
- 8 -
<PAGE> 9
10.5.1. Increases the maximum number of shares as to which
options may be granted under the Plan;
10.5.2. Alters the method by which the option price is
determined;
10.5.3. Extends any option for a period longer than 10 years
after the date of grant;
10.5.4. Materially modifies the requirements as to eligibility
for participation in the Plan;
10.5.5. Provides for the administration of the Plan by a
Committee that is not composed entirely of officers of the Company who are not
eligible to participate in the Plan;
10.5.6. Causes the options granted under the Plan not to qualify
for the exemption provided by Rule 16b-3, or any successor Rule; or
10.5.7. Alters this Section 10 so as to defeat its purpose.
10.6. Notwithstanding anything contained in the preceding paragraph or
any other provision of the Plan or any option agreement, the Board shall have
the power to amend the Plan in any manner deemed necessary or advisable for the
options granted under the Plan to qualify for the exemption provided by Rule
16b-3 (or any successor rule relating to exemption from Section 16(b) of the
Act), and any such amendment shall, to the extent deemed necessary or advisable
by the Board, be applicable to any outstanding options theretofore granted under
the Plan notwithstanding any contrary provisions contained in any option
agreement. In the event of any such amendment to the Plan, the holder of any
option outstanding under the Plan shall, upon request of the Committee and as a
condition to the exercisability of such option, execute a conforming amendment
in the form prescribed by the Committee to their option agreement within such
reasonable time as the Committee shall specify in such request.
- 9 -
<PAGE> 10
SECTION 11
CHANGES IN CAPITALIZATION
11.1. In the event that the shares of stock of the Company, as
presently constituted, shall be changed into or exchanged for a different number
or kind of shares of stock or other securities of the Company or of another
corporation (whether by reason of merger, consolidation, recapitalization,
reclassification, split-up, combination of shares or otherwise) or if the number
of such shares of stock shall be increased through the payment of a stock
dividend, then, subject to the provisions of Section 11.3 below, there shall be
substituted for or added to each share of stock of the Company which was
theretofore appropriated, or which thereafter may become subject to an option
under the Plan, the number and kind of shares of stock or other securities into
which each outstanding share of the stock of the Company shall be so changed or
for which each such share shall be exchanged or to which each such share shall
be entitled, as the case may be. Outstanding options shall also be appropriately
amended as to price and other terms, as may be necessary to reflect the
foregoing events.
11.2. Subject to the provisions of Section 8.6, a dissolution or
liquidation of the Company, or a merger or consolidation in which the Company is
not the surviving corporation, shall cause each outstanding option to terminate,
except to the extent that another corporation may and does in the transaction
assume and continue the option or substitute its own options.
11.3. Fractional shares resulting from any adjustment in options
pursuant to this Section 11 may be dealt with as the Committee shall determine.
11.4. To the extent that the foregoing adjustments relate to stock or
securities of the Company, such adjustments shall be made by the Committee,
whose determination in that respect shall be final,
- 10 -
<PAGE> 11
binding and conclusive. Notice of any adjustment shall be given by the Company
to each holder of an option which shall have been so adjusted.
11.5. The grant of an option pursuant to the Plan shall not affect in
any way the right or power of the Company to make adjustments,
reclassifications, reorganization or changes of its capital or business
structure, to merge, to consolidate, to dissolve, to liquidate or to sell or
transfer all or any part of its business or assets.
SECTION 12
EFFECTIVE DATE AND DURATION OF PLAN
The Plan shall become effective upon approval by the affirmative vote
of the holders of a majority of the Common Stock present in person or by proxy
and entitled to vote at a duly called and convened meeting of the Company's
stockholders. If such approval is obtained at the Annual Meeting of Stockholders
in 1996, the Plan shall be effective on the date of such meeting, the first
options shall be granted on the first business day thereafter and the last
options granted under this Plan shall be granted on the first business day after
the Annual Meeting of Stockholders in 2005.
APPROVED AND ADOPTED BY THE SHAREHOLDERS ON 26 April 1996.
- 11 -
<TABLE> <S> <C>
<ARTICLE> 9
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
UNAUDITED CONSOLIDATED BALANCE SHEET AS OF JUNE 30, 1996 AND THE RELATED
UNAUDITED CONSOLIDATED STATEMENT OF INCOME FOR THE SIX MONTHS ENDED JUNE 30,
1996 INCLUDED IN THE COMPANY'S FORM 10-Q FOR THE PERIOD ENDED JUNE 30, 1996 AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> JUN-30-1996
<CASH> 338,616
<INT-BEARING-DEPOSITS> 40,996
<FED-FUNDS-SOLD> 345,386
<TRADING-ASSETS> 175,259
<INVESTMENTS-HELD-FOR-SALE> 431,194
<INVESTMENTS-CARRYING> 1,335,849
<INVESTMENTS-MARKET> 1,340,467
<LOANS> 3,212,191
<ALLOWANCE> 69,272
<TOTAL-ASSETS> 6,087,914
<DEPOSITS> 4,340,316
<SHORT-TERM> 1,070,691
<LIABILITIES-OTHER> 68,983
<LONG-TERM> 134,402
0
0
<COMMON> 84,604
<OTHER-SE> 388,918
<TOTAL-LIABILITIES-AND-EQUITY> 6,087,914
<INTEREST-LOAN> 146,229
<INTEREST-INVEST> 83,357
<INTEREST-OTHER> 0
<INTEREST-TOTAL> 229,586
<INTEREST-DEPOSIT> 63,762
<INTEREST-EXPENSE> 106,147
<INTEREST-INCOME-NET> 123,439
<LOAN-LOSSES> 1,360
<SECURITIES-GAINS> 70
<EXPENSE-OTHER> 101,192
<INCOME-PRETAX> 73,490
<INCOME-PRE-EXTRAORDINARY> 48,735
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 48,735
<EPS-PRIMARY> 3.31
<EPS-DILUTED> 3.31
<YIELD-ACTUAL> 4.35
<LOANS-NON> 8,501
<LOANS-PAST> 5,494
<LOANS-TROUBLED> 206
<LOANS-PROBLEM> 1,275
<ALLOWANCE-OPEN> 67,555
<CHARGE-OFFS> 5,130
<RECOVERIES> 2,921
<ALLOWANCE-CLOSE> 69,272
<ALLOWANCE-DOMESTIC> 11,686
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 57,586
</TABLE>
