Key Takeaways
- Zions Bancorporation’s first-quarter revenue fell less than expected, and the bank reduced the amount of cash it set aside to pay for bad loans.
- The bank reduced its provisions for credit losses to $13 million from $45 million last year.
- Zions anticipates loan losses will be “very manageable” over the rest of this year.
Shares of Zions Bancorporation ( ZION ) advanced in intraday trading Monday as the regional bank posted better-than-expected revenue and reduced the money it set aside for bad loans.
The bank reported first-quarter revenue declined more than 11% to $742 million, but that was slightly above analysts’ forecasts compiled by Visible Alpha. Earnings per share (EPS ) of $0.96 matched forecasts.
Net interest income was down 14% to $586 million. However, even though net income margin dropped to 2.94% from 3.33% in Q1 2023, it was slightly higher than the 2.91% in the fourth quarter. Noninterest income slipped 3% year-over-year to $156 million.
Zions slashed its provisions for credit losses to $13 million from $45 million in the same period last year. Chief Executive Officer (CEO ) Harris Simmons said the bank continues to anticipate that “ultimate realized loan losses will be very manageable over the remainder of the year, as indicated by annualized net charge-offs for the quarter which were a very low 0.04% of loans and leases.”
The company also paid $13 million in a special Federal Deposit Insurance Corporation (FDIC) assessment to cover expenses incurred to cover for bank failures.
Shares of Zions Bancorporation rose 4.4% to $41.69 as of 2:06 p.m. ET Monday but are about 5% lower this year.