SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
May 18, 1998
Date of Report (Date of Earliest Event Reported)
ZIONS BANCORPORATION
(Exact Name of Registrant As Specified In Its Charter)
UTAH
(State or Other Jurisdiction of Incorporation)
0-2610 87-0227400
(Commission File Number) (IRS Employer Identification No.)
One South Main, Suite 1380
Salt Lake City, Utah 84111
(Address of Principal Executive Offices)(Zip Code)
(801) 524-4787
(Registrant's Telephone Number, including Area Code)
(Former Name or Former Address, If Changed Since Last Report)
<PAGE>
Item 5. Other Events.
On March 25, 1998, Zions Bancorporation ("Zions") entered into an
Agreement and Plan of Merger, by and among Zions, SBC Acquisition Corp. ("SBC")
and The Sumitomo Bank of California ("Sumitomo"), pursuant to which SBC, an
indirect wholly owned subsidiary of Zions, will merge with and into Sumitomo.
In connection therewith, Zions hereby files The Sumitomo Bank of
California's unaudited balance sheet as of March 31, 1998 and unaudited
statements of income, changes in shareholders' equity and cash flows for the
three months ended March 31, 1998 and 1997. This financial information appears
as Exhibit 99.1 and is incorporated herein by reference. The foregoing summary
is qualified in its entirety by reference to such documents.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(a) Not Applicable.
(b) Not Applicable.
(c) Exhibits
The following exhibits are filed with this Current Report on Form 8-K:
Exhibit
Number Description
- ------- ------------
99.1 Unaudited balance sheet as of March 31, 1998 and unaudited
statements of income, changes in shareholders' equity and cash
flows for the three months ended March 31, 1998 and 1997 of The
Sumitomo Bank of California.
2
<PAGE>
SIGNATURE
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 hereunder duly authorized.
Dated: May 15, 1998
ZIONS BANCORPORATION
By: /s/ Dale M. Gibbons
Name: Dale M. Gibbons
Title: Executive Vice President and
Chief Financial Officer
3
<PAGE>
EXHIBIT INDEX
Exhibit
Number Description
- ------- -----------
99.1 Unaudited balance sheet as of March 31, 1998 and unaudited
statements of income, changes in shareholders' equity and cash
flows for the three months ended March 31, 1998 and 1997 of The
Sumitomo Bank of California.
4
<TABLE>
<CAPTION>
BALANCE SHEET
(Unaudited)
- -----------------------------------------------------------------------------------------------------
(In thousands, except share amounts) March 31, December 31, March 31,
1998 1997 1997
-------------------------------------------
<S> <C> <C> <C>
Assets
Cash and due from banks $ 180,813 $ 200,760 $ 204,791
Interest-bearing deposits with other banks 354,681 466,000 526,479
Investment securities:
Held-to-maturity 110,468 150,307 237,718
Available-for-sale 346,612 375,787 385,767
Federal funds sold 0 0 40,000
Loans and lease financing 3,881,131 3,891,863 3,634,293
Less: Unearned income (14,866) (12,038) (12,412)
Allowance for credit losses (116,686) (116,753) (120,624)
--------------------------------------------
Net loans and lease financings 3,749,579 3,763,072 3,501,257
Bank premises and equipment, net 31,902 31,640 29,608
Customers' acceptance liability 4,032 4,390 1,051
Other assets 108,195 109,616 138,461
--------------------------------------------
Total Assets $ 4,886,282 $ 5,101,572 $ 5,065,132
============================================
Liabilities and Shareholders' Equity
Deposits:
Domestic offices:
Noninterest-bearing $ 425,535 $ 671,590 $ 604,804
Interest-bearing 3,752,607 3,587,875 3,570,691
Foreign office:
Interest-bearing 82,737 95,612 113,291
--------------------------------------------
Total deposits 4,260,879 4,355,077 4,288,786
Federal funds purchased and
repurchase agreements 32,700 93,100 71,330
Other short-term borrowings 24,955 25,031 10,648
Acceptances outstanding 4,032 4,390 1,051
Long-term debt 2,812 65,534 151,965
Other liabilities 54,985 55,092 57,412
--------------------------------------------
Total liabilities 4,380,363 4,598,224 4,581,192
-------------------------------------------
Shareholders' equity:
Preferred stock: no par
Authorized: 5,000,000 shares 75,000 75,000 75,000
Outstanding: 1998 and 1997-750,000 shares
Common stock: $5 par value 82,107 82,099 82,059
Authorized: 25,000,000 shares
Outstanding: March 31, 1998 - 16,421,402 shares
December 31, 1997 - 16,419,733 shares
March 31, 1997 - 16,411,723 shares
Surplus 267,555 267,484 267,267
Undivided profits 81,502 78,920 61,826
Net unrealized loss
on available-for-sale securities (245) (155) (2,212)
---------------------------------------------
Total shareholders' equity 505,919 503,348 483,940
---------------------------------------------
Total Liabilities and Shareholders' Equity $4,886,282 $ 5,101,572 $ 5,065,132
---------------------------------------------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
STATEMENTS OF INCOME
(unaudited)
(In thousands) Three Months Ended
March 31,
- ------------------------------------------------------------------------------------------------------
1998 1997
---------------------------------------------
<S> <C> <C>
Interest Income
Interest and fees on loans and lease financing $ 79,982 $ 77,055
Interest on investment securities:
Taxable 7,198 9,393
Exempt from federal income taxes 0 95
Interest on deposits with other banks 6,206 7,187
Interest on federal funds sold 506 575
---------------------------------------------
Total interest expense 93,892 94,305
---------------------------------------------
Interest Expense
Interest on deposits 42,188 39,982
Interest on short-term borrowings 630 792
Interest on long-term debt 847 2,417
---------------------------------------------
Total interest expense 43,665 43,191
---------------------------------------------
Net interest income 50,227 51,114
Provision for credit losses 2,000 5,000
---------------------------------------------
Net interest income after provision for credit losses 48,227 46,114
---------------------------------------------
Other Operating Income
Service charges on deposit accounts 1,244 1,217
Trust fees and commissions 890 871
Investment securities gains 0 61
Other income 3,627 4,026
---------------------------------------------
Total other operating income 5,761 6,175
---------------------------------------------
Other Operating Expense
Salaries 15,833 15,701
Employee benefits 6,507 4,465
---------------------------------------------
Total staff expense 22,340 20,166
Net occupancy expense 4,131 3,851
Equipment expense 1,845 1,942
Other expense 14,235 11,184
---------------------------------------------
Total other operating expense 42,551 37,143
---------------------------------------------
Income before income taxes 11,437 15,146
Income tax expense 4,047 5,473
---------------------------------------------
NET INCOME $ 7,390 $ 9,673
=============================================
NET INCOME APPLICABLE TO COMMON STOCK $ 5,866 $ 8,149
---------------------------------------------
Average common share outstanding 16,420,957 16,410,882
</TABLE>
-2-
<PAGE>
<TABLE>
<CAPTION>
STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
(unaudited)
- ------------------------------------------------------------------------------------------------------
(In thousands) Three Months Ended
March 31,
---------------------------------------------
1998 1997
---------------------------------------------
<S> <C> <C>
Preferred Stock
Balance at beginning of period $ 75,000 $ 75,000
---------------------------------------------
Balance at end of period $ 75,000 $ 75,000
---------------------------------------------
Common Stock
Balance at beginning of period $ 82,099 $ 82,043
Dividends reinvested 8 16
---------------------------------------------
Balance at end of period $ 82,107 $ 82,059
---------------------------------------------
Surplus
Balance at beginning of period $ 267,484 $ 267,197
Dividends reinvested 71 70
---------------------------------------------
Balance at end of period $ 267,555 $ 267,267
---------------------------------------------
Undivided profits
Balance at beginning of period $ 78,920 $ 56,959
Net income 7,390 9,673
Cash dividends declared on:
Common stock at $0.20 per share in 1998 and 1997 (3,284) (3,282)
Preferred stock (1,524) (1,524)
---------------------------------------------
Balance at end of period $ 81,502 $ 61,826
---------------------------------------------
Net unrealized gains (losses)
on available-for-sale securities
Balance at beginning of period $ (155) $ (670)
Change in unrealized gains (losses) (90) (1,542)
---------------------------------------------
Balance at end of period $ (245) $ (2,212)
---------------------------------------------
Total shareholders' equity at end of period $ 505,919 $ 483,940
=============================================
</TABLE>
<TABLE>
<CAPTION>
STATEMENTS OF CHANGES IN ALLOWANCE FOR CREDIT LOSSES
(unaudited)
- ------------------------------------------------------------------------------------------------------
(In thousands) Three Months Ended
March 31,
---------------------------------------------
1998 1997
---------------------------------------------
<S> <C> <C>
Balance at beginning of period $ 116,753 $ 126,171
Provision charged to expense 2,000 5,000
Recoveries credited 968 2,023
Losses charged (3,035) (12,570)
---------------------------------------------
Balance at end of period $ 116,686 $ 120,624
---------------------------------------------
</TABLE>
-3-
<PAGE>
<TABLE>
<CAPTION>
STATEMENTS OF CASH FLOW
(unaudited)
- ------------------------------------------------------------------------------------------------------
(In thousands) Three Months Ended
March 31,
---------------------------------------------
1998 1997
---------------------------------------------
<S> <C> <C>
Operating Activities
Net income $ 7,390 $ 9,673
Adjustments to reconcile net income to net
cash provided by operating activities:
Provision for credit losses 2,000 5,000
Provision for depreciation and amortization 1,398 1,513
Provision for deferred income taxes 2,295 2,240
Gain on sales of other real estate owned (133) (795)
Amortization of investment security premiums and dis (320) (275)
Gain on maturities and sales of investment securities -- (61)
Net (increase) decrease in interest receivable 5,849 (1,591)
Net increase in prepaid expenses (5,963) (1,112)
Net decrease in interest payable (2,253) (670)
Net increase in accrued expenses 3,918 8,582
Others, net (3,197) (24,730)
---------------------------------------------
Net cash provided (used) by operating $ 10,984 $ (2,226)
activities ---------------------------------------------
Investing Activities
Held-to-maturity securities
Maturities $ 40,000 $ 1,727
Available-for-sale securities
Sales -- 58,233
Maturities 159,156 8,990
Purchases (129,962) (145,088)
Net (increase) decrease in interset-bearing deposits
with other banks 111,320 (7,700)
Net increase in loans and lease financing 11,381 11,874
Proceeds from sales of other real estate owned 957 3,331
Purchase of premises and equipment (1,659) (860)
---------------------------------------------
Net cash provided (used) by investing activities $ 191,193 $ (69,493)
---------------------------------------------
Financing Activities
Net increase (decrease) in deposits $ (94,199) $ 50,027
Net increase (decrease) in short-term borrowings (60,476) 33,779
Net decrease in long-term debt (144) (134)
Redemption of long-term debt (62,577) --
Proceeds from issuance of common stock 79 86
Cash dividends paid (4,807) (4,805)
---------------------------------------------
Net cash provided (used) by financing activities $ (222,124) $ 78,953
Net increase (decrease) in cash and due from banks (19,947) 7,234
---------------------------------------------
Cash and due from banks at beginning of period $ 200,760 $ 197,557
---------------------------------------------
Cash and due from banks at end of period $ 180,813 $ 204,791
---------------------------------------------
</TABLE>
-4-
<PAGE>
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
Basis of Presentation
The unaudited financial statements of Sumitomo Bank of California (the Bank)
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. Operating results for the three months ended
March 31, 1998 are not necessarily indicative of the results that may be
expected for the year ended December 31, 1998. For further information, refer to
the financial statements and footnotes thereto included in the Bank's Annual
Report to Shareholders on Form 10-K for the year ended December 31, 1997.
The Bank adopted Statement of Financial Accounting Standards No. 128, "Earnings
per Share" (SFAS 128) on January 1, 1997 and disclosed the effects within its
December 31, 1997 annual report. SFAS 128 replaces primary & fully diluted
earnings per share with basic and diluted earnings per share calculations. Basic
earnings per share calculations result in the same earnings per share previously
reported by the Bank. There are no potentially dilutive common shares. The
Bank's basic earnings per share for the three months ended March 31, 1998, and
1997 were as follows (in thousands, except share data):
Three months ended
March 31,
1998 1997
------------------------------
Net income $ 7,390 $ 9,673
Less: Preferred stock dividends (1,524) (1,524)
------------------------------
Income available to common shareholders 5,866 8,149
------------------------------
Weighted average shares 16,420,957 16,410,882
Basic earnings per share $ 0.36 $ 0.50
==============================
The Bank adopted SFAS 130 "Reporting Comprehensive Income" (by including
footnote disclosure only) for the quarter ending March 31, 1998. SFAS 130
establishes standards for reporting and displaying comprehensive income and its
components in the financial statements. For the Bank, comprehensive income
includes net income reported on the income statement and changes in the fair
value of its available-for-sale investments reported as a component of
shareholders' equity. The following table presents net income adjusted by the
change in unrealized gains or losses on the available-for-sale investments as a
component of comprehensive income for the three months ended March 31, 1998, and
1997 (in thousands):
Three months ended
March 31,
1998 1997
------------------------------
Net income $ 7,390 $ 9,673
Net change in unrealized gains (losses)
on available for sale investments (90) (1,542)
------------------------------
Comprehensive income $ 7,300 $ 8,131
==============================
-5-
