Zions Bancorporation’s ( ZION Quick Quote ZION - Free Report) third-quarter 2021 net earnings per share of $1.45 surpassed the Zacks Consensus Estimate of $1.38. The bottom line represents an increase of 43.6% from the year-ago quarter’s number. Results were primarily aided by a decline in expenses and provision benefits. The company witnessed a rise in deposit balances in the quarter. However, net interest income (NII) remained unchanged year over year, while non-interest income witnessed a fall. Net income attributable to common shareholders was $234 million, up 40.1% from the prior-year quarter’s figure. Revenues & Expenses Decline
Net revenues (tax equivalent) were $701 million, down 2.5% year over year. The top line missed the Zacks Consensus Estimate of $708.4 million.
NII was $555 million, unchanged from the prior-year quarter. Net interest margin contracted 38 basis points (bps) year over year to 2.68%. Non-interest income was $139 million, down 11.5% from the year-ago quarter. The decline was due to a fall in fair value and non-hedge derivative income. Also, the company recorded net securities losses in the quarter under review against net gains in the year-ago quarter. Adjusted non-interest expenses were $432 million, down 1.8% from the prior-year quarter. Efficiency ratio was 59.8%, down from 62.2% reported in the prior-year period. A fall in the efficiency ratio indicates an improvement in profitability. As of Sep 30, 2021, net loans held for investment were $50.2 billion, down 1.3% from the prior quarter’s end. Total deposits were $77.9 billion, up 2.3% sequentially. Credit Quality Improves
The ratio of non-performing assets to loans and leases as well as other real estate owned contracted 4 bps year over year to 0.64%. In the reported quarter, the company recorded net loan and lease recoveries of $1 million against charge-offs of $52 million in the prior-year quarter.
Provision for credit losses was a benefit of $46 million against a provision of $55 million reported in the year-earlier quarter. Capital Ratios Mixed, Profitability Ratios Improve
Tier 1 leverage ratio was 7.6% as of Sep 30, 2021, compared with 8.3% recorded at the end of the prior-year quarter. Tier 1 risk-based capital ratio of 11.6% increased from 11.4%.
At the end of the reported quarter, return on average assets was 1.08%, up from 0.89% as of Sep 30, 2020. Also, return on average tangible common equity was 14.2%, up from 11% witnessed in the year-ago quarter. Our Take
Zions’ strong balance-sheet position along with its business-simplifying efforts bodes well for the future. However, given the low interest rate environment, the company’s margins are expected to remain under pressure.
Currently, Zions carries a Zacks Rank #3 (Hold). You can see
. the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here Performance of Major Banks
Robust advisory business, reserve release, and a modest rise in demand for loans drove
JPMorgan’s ( JPM Quick Quote JPM - Free Report) third-quarter 2021 earnings of $3.74 per share. The bottom line also handily outpaced the Zacks Consensus Estimate of $3.00. Bank of America’s ( BAC Quick Quote BAC - Free Report) third-quarter 2021 earnings of 85 cents per share beat the Zacks Consensus Estimate of 71 cents. The bottom line compared favorably with 51 cents earned in the prior-year quarter. Results in the quarter included a reserve release of $1.1 billion. PNC Financial ( PNC Quick Quote PNC - Free Report) pulled off a third-quarter 2021 earnings beat of 3.02% on substantial recapture of credit losses. Adjusted earnings per share (excluding pre-tax integration costs related to the BBVA USA acquisition) of $3.75 surpassed the Zacks Consensus Estimate of $3.64 and improved 42% sequentially.