Zions Bancorporation (ZBK)

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ZBKhttp://www.nasdaq.com/symbol/zbkFinancen/aMajor Banks

Latest Zions Bancorporation (ZBK) company news

Loan Growth and Higher Rates Aid Zions (ZION) Amid High Costs

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Zions Bancorporation ZION remains well poised for revenue growth, supported by continued improvement in loan balances along with higher rates. Moreover, the regulatory nod for removal of the label of systemically important financial institution (“SIFI”) is a major positive for the company.

However, increasing expenses and a risky loan portfolio are major concerns for Zions. Despite strong fundamentals, the Zacks Consensus Estimate for current-year earnings has been marginally revised downward over the past 30 days, reflecting that analysts are not very optimistic regarding the company’s earnings growth potential.

Thus, the stock currently carries a Zacks Rank #3 (Hold). In fact, its shares have gained 16.4% in a year’s time, marginally underperforming 16.8% growth recorded by the industry.

Looking at the fundamentals, Zions’ net loans and leases have witnessed a CAGR of 3.5% over the last six years (2012-2017). Additionally, its non-interest deposits, as a percentage of total deposits, have been on the rise. The company’s initiatives to efficiently deploy the capital generated from these deposits and growth in loan demand will support revenue generation in the quarters ahead.

Moreover, with the improvement in interest rates, margin pressure for Zions seems to be easing. The company has been benefiting from increased yields and growth in loan balance.

Additionally, credit quality continues to be a major strength for Zions. The company has been recording a consistent decline in allowance for credit losses over the past several quarters. With stress in energy portfolio gradually diminishing and no longer a concern, the company’s asset quality will improve in the future, driven by improving economy.

However, due to higher salaries and employee benefits, and FDIC premiums, Zions’ expenses have remained elevated. In fact, management expects operating expenses to flare up marginally in 2018.

Moreover, the presence of high levels of commercial real estate (CRE) assets on the company’s balance sheet will likely put it in a tight spot. Because of this, raising new capital and removing troubled loans are expected to take precedence over finding growth opportunities.

Further, the presence of concentration risk because of lack of geographic diversification might hurt the company’s financials in the long run.

A few stocks from the finance space worth considering are Ameriprise Financial, Inc. AMP, Lazard Ltd LAZ and SEI Investments Co. SEIC. Each of these stocks has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Ameriprise Financial’s Zacks Consensus Estimate for current-year earnings has been revised 1.7% upward over the past 60 days. The company’s share price has increased 2% over the past year.

Lazard has witnessed an upward earnings estimate revision of 2.9% for the current year over the past 60 days. The stock has gained 10.1% in the past year.

SEI Investments’ Zacks Consensus Estimate for current-year earnings has been revised nearly 1% upward over the past 60 days. Additionally, the company’s shares have gained 6.4% in a year’s time.

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Zions Bancorporation Announces Commencement Of Consent Solicitation

SALT LAKE CITY, Sept. 17, 2018 /PRNewswire/ -- Zions Bancorporation ("Zions" or "the Company" and NASDAQ: ZION) announced today that it has commenced the solicitation of consent (the "Consent Solicitation") of holders ("Holders") of its 4.50% Senior Notes due June 13, 2023 (CUSIP No.: 989701 BE6; ISIN US989701 BE66) (the "Notes") to obtain a one-time waiver (the "Waiver") in relation to certain covenants in the indenture governing the Notes (specifically, the covenants set forth in Sections 1009 and 1010 of the indenture dated September 10, 2002, as supplemented by the first supplemental indenture, dated April 21, 2014), upon the terms and subject to the conditions set forth in the Consent Solicitation Statement (the "Solicitation Statement"), dated September 17, 2018.

The consents are being solicited to obtain a one-time waiver with respect to Zions' previously announced merger, and related transactions, whereby Zions will merge with and into its wholly-owned subsidiary, ZB, N.A. (the "Bank"), with the Bank continuing as the surviving entity.

The Consent Solicitation will expire at 5:00 p.m., New York City time, on September 25, 2018 (the "Expiration Date").  Zions is offering each consenting Holder a payment of $2.50 per $1,000 principal amount of Notes held by such consenting Holder.

If the consent of Holders of not less than 66 2/3% in aggregate principal amount of the Notes outstanding (disregarding Notes that are held by the Company) are received and not validly revoked, and all of the conditions described in the Solicitation Statement are satisfied or waived by Zions, on or prior to the Expiration Date, the Waiver will become effective immediately upon payment of the consent fee. Once the Waiver is effective, consents may not be revoked.

Zions has engaged TD Securities (USA) LLC to act as solicitation agent in connection with the Consent Solicitation. Questions regarding the Consent Solicitation may be directed to TD Securities (USA) LLC by calling (212) 827-2833 or by email at [email protected].

Zions has engaged Global Bondholder Services Corporation as information and tabulation agent in connection with the Consent Solicitation. Requests for documentation may be directed to Global Bondholder Services Corporation by calling (212) 430-3774 (collect) or (866) 794-2200 (toll free) or by email at [email protected].

This press release does not set forth all of the terms and conditions of the Consent Solicitation. Holders should carefully read the Solicitation Statement and the accompanying materials for a complete description of all terms and conditions before making any decision with respect to the Consent Solicitation. None of Zions, the solicitation agent, the information and tabulation agent or any of their respective affiliates makes any recommendation as to whether or not any Holder should consent to the Waiver.

Zions Bancorporation is one of the nation's premier financial services companies with total assets exceeding $65 billion.  Zions operates under local management teams and distinct brands in 11 western states: Arizona, California, Colorado, Idaho, Nevada, New Mexico, Oregon, Texas, Utah, Washington and Wyoming. The company is a national leader in Small Business Administration lending and public finance advisory services, and is a consistent top recipient of Greenwich Excellence awards in banking.  In addition, Zions is included in the S&P 500 and NASDAQ Financial 100 indices.

 

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Zions Gets Regulatory Approval for Removal of SIFI Label

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The restructuring process that begun with an aim to “reduce or eliminate operating and regulatory burdens and inefficiencies” and lower operating expenses is finally coming to an end. Zions Bancorporation ZION has received regulatory approval for the removal of the “systemically important financial institution" (SIFI) label.

The Financial Stability Oversight Council (FSOC) voted 9 to 0 to remove Zions from SIFI list, thereby, freeing the bank from stricter regulatory oversight by the Federal Reserve. This follows the preliminary approval by the FSOC in July.

Notably, the removal is contingent upon completion of the merger of its holding company with its bank, ZB NA. Now the bank intends to hold a special shareholder meeting on Sep 14 for getting their consent for the merger. If approved, this merger is expected to be closed by Sep 30.

Treasury Secretary, Steven Mnuchin, stated that he was pleased with the council’s decision that "there is not a significant risk that Zions could pose a threat to U.S. financial stability."

What This Means for Zions?

Zions undertook a number of initiatives to consolidate its several branches. Further, in 2015, the company consolidated its seven subsidiary banks into a single national bank charter.

With consolidated assets of nearly $65 billion, Zions is one of the smallest financial institutions that was part of the SIFIs. Per provisions of the 2010 Dodd-Frank Act, banks with more than $50 billion in assets were considered SIFIs. Nonetheless, passage of the Economic Growth, Regulatory Relief and Consumer Protection Act this May will eventually raise the threshold to $250 billion.

Banks with assets in the range of $50-$100 billion got immediate relief, while those with assets between $100 billion and $250 billion will be exempted by November 2019. Thus, other than Zions, SunTrust STI, BB&T Corporation BBT and Citizens Financial Group, Inc. CFG are the other banks that will eventually be exempted.

The SIFIs have to abide by various capital requirement rules and there is a lot of scrutiny that this regulatory label carries with itself. This is because failure of any of these companies can pose a threat to the global financial system. Further, these institutions are required to undergo annual stress tests and submit so-called ‘living wills’, both necessitated as measures to plan for financial disasters.

Thus, with the removal of the SIFI label, Zions’ regulatory compliance costs are expected to come down. Notably, the bank was exempted from being subject to the stress tests from this year itself. This provides the company with financial flexibility to announce capital-deployment actions. In July 2018, the bank authorized repurchase of up to $185 million of shares in third-quarter 2018 and increased quarterly dividend by 25%.

Zions’ shares have rallied 9.5% so far this year, outperforming the 2.8% gain for the industry it belongs to.

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Federal regulators OK removal of strict oversight over Zions

WASHINGTON (AP) -- A panel of federal regulators has lifted the strict government oversight it had imposed on Zions, a big regional bank.

The Financial Stability Oversight Council announced Wednesday it had decided to grant the request by Zions allowing it to escape the more strict oversight upon completion of its proposed merger with its parent company, Salt Lake City-based Zions Bancorporation.

The action, which had been approved on a preliminary basis in July, is the latest move under the Trump administration to relieve regulatory restrictions put in place after the 2008 financial crisis.

Treasury Secretary Steven Mnuchin said in a statement he was pleased the council had determined that "there is not a significant risk that Zions could pose a threat to U.S. financial stability." The council approved the action unanimously.

Zions Bancorporation Announces Results Of Regulatory Actions

SALT LAKE CITY, Sept. 12, 2018 /PRNewswire/ -- Zions Bancorporation ("Zions" or "the Company" and NASDAQ: ZION) announced today that it has been notified of the final decision by the Financial Stability Oversight Council (FSOC) to grant Zions' appeal for relief from the designation of Zions or its successor as a systemically important financial institution, or SIFI, under the Dodd-Frank Act. Zions has now received the material requisite regulatory approvals to complete the merger of its holding company with and into its bank, ZB, N.A., with the resulting bank to be known as Zions Bancorporation, N.A. (the "Bank"). As described in its proxy materials filed with the Securities and Exchange Commission, Zions will hold a special shareholder meeting on September 14, 2018 with respect to shareholder approval of the merger. Assuming receipt of shareholder approval at the meeting, it is anticipated that the merger will be completed effective as of September 30, 2018.  The merger is expected to result in the elimination of duplicative regulatory efforts, leaving the Office of the Comptroller of the Currency as the Bank's primary federal regulator. Additional detail may be found within the proxy materials at Zionsbancorporation.com (link).

Zions Bancorporation is one of the nation's premier financial services companies with total assets exceeding $65 billion.  Zions operates under local management teams and distinct brands in 11 western states: Arizona, California, Colorado, Idaho, Nevada, New Mexico, Oregon, Texas, Utah, Washington and Wyoming. The company is a national leader in Small Business Administration lending and public finance advisory services, and is a consistent top recipient of Greenwich Excellence awards in banking.  In addition, Zions is included in the S&P 500 and NASDAQ Financial 100 indices.

Forward Looking Information

This press release includes forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. Statements in the press release that are based on other than historical information or that express Zions's expectations regarding future events or determinations are forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements reflect, among other things, the current expectations of Zions, all of which are subject to known and unknown risks, uncertainties and other factors that may cause actual results to differ materially from those expressed or implied by such forward-looking statements.

Without limiting the foregoing, the words "anticipates," "believes," "can," "continue," "could," "estimates," "expects," "intends," "may," "might," "plans," "projects," "should," "would," "targets," "will" and the negative thereof and similar words and expressions are intended to identify forward-looking statements. Forward-looking statements by their nature address matters that are, to different degrees, uncertain, such as statements about the potential timing or consummation of the merger described in this press release, actions to be taken by Zions and the Bank or receipt of any required approvals or determinations. Actual results and outcomes may differ materially from those presented, either expressed or implied, in the press release. Important risk factors that may cause such material differences include, but are not limited to, uncertainties related to the ability to obtain shareholder approval, or the possibility that such approval may be delayed; the ability of Zions to achieve anticipated benefits from the consolidation; and legislative, regulatory and economic developments that may diminish or eliminate the anticipated benefits of the consolidation. These risks, as well as other factors, are discussed in Zions's most recent Annual Report on Form 10-K, filed with the Securities and Exchange Commission ("SEC") and available at the SEC's Internet site (http://www.sec.gov), and in the definitive proxy statement filed with the SEC in connection with the merger on July 24, 2018. 

Except as required by law, Zions specifically disclaims any obligation to update any factors or to publicly announce the result of revisions to any of the forward-looking statements included herein to reflect future events or developments.

Important Additional Information and Where to Find It

Zions filed a definitive proxy statement on July 24, 2018, and other relevant documents concerning the merger with the SEC. INVESTORS ARE URGED TO READ THE PROXY STATEMENT AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC BECAUSE THEY CONTAIN IMPORTANT INFORMATION. You will be able to obtain the documents free of charge at the website maintained by the SEC at www.sec.gov. In addition, you may obtain documents filed with the SEC by Zions free of charge by contacting: Investor Relations, Zions Bancorporation, One South Main Street, 11th Floor, Salt Lake City, Utah 84133, (801) 844-7637.

Participants in Proxy Solicitation

Zions and its directors and executive officers may be deemed to be participants in the solicitation of proxies from Zions's shareholders in connection with the merger. Information about the directors and executive officers of Zions and their ownership of Zions stock is set forth in Zions's Annual Report on Form 10-K for the year ended December 31, 2017 and the proxy statement for Zions' 2018 Annual Meeting of Shareholders. Investors may obtain additional information regarding the interests of such participants by reading the definitive proxy statement for the proposed merge, which was filed with the SEC on July 24, 2018.

 

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