Zions Bancorporation N.a. · NASDAQ:ZION
Zions Bancorporation N.a — Zions Bancorporation — Barclays Capital Global Financial Services Conference 2009
43 slides from Zions Bancorporation N.a's conference presentation, Sep 15, 2009
Slide 1: Barclays Capital Global Financial Services Conference
Barclays Capital Global Financial Services Conference 15 September 2009 ■ New York
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains statements that relate to the projected performance of Zions Bancorporation and elements of or affecting such performance, including statements with respect to the beliefs, plans, objectives, goals, guidelines, expectations, anticipations and est
Slide 3: Bank Headquarters, Offices, Assets, Deposits
Bank Headquarters Offices __Assets _Deposits Zions Bank Salt Lake City 128 $20.88 $16.2B CBaT San Diego 23 $1078 36.58 “Amegy Houston 4 Sie 39.18 NBA Phoenix 76 $4.98 $4.0B NSB Tas Vegas 59 3438 33.78 Vectra Denver EX $2.5B $2.0B ‘Commerce WA Seattle 7 30.88 30.68 Commerce-OR Portland 4 $0.06B $0.04
Slide 4: Zions' Strengths
• Annual pretax, pre-provision earnings of ~$950 mm-to- $1billion – NIM: 4.09%, ranked #2 of regional banks/peers. – One quarter of deposits are non-interest bearing (rank: #3 of peers) • Strong allowance for credit loss: 3.2% of loans • Tier 1 Common / Risk-weighted assets: $1.1 billion in excess o
Slide 5: Zions' Challenges
• Rising NPAs, to 4.7% of loans from 4.0% in prior quarter – Total delinquent + NPA was up 4%, decelerating sharply from the prior quarter rate • YTD net charge-off rate of 2.4% • Continued securities impairments (OTTI), primarily on bank/insurance CDOs - $42.0 million in 2Q Zions’ Challenges
Slide 6: Our Growth Engine
Footprint Population Growth Estimates from SNL Financial (2009-2014) Our Growth Engine
Slide 7: Agenda: Key Drivers Going Forward
Agenda Key Drivers Going Forward – Net Interest Margin – Credit Quality – Securities Portfolio – Capital Outlook Summary
Slide 8: Net Interest Margin (Regional Bank Peers)
Source: SNL Source: SNL Note: Peer group includes U.S. regional banks with assets greater than $20 billion and less than $200 billion plus footprint competitors WFC and USB. Net Interest Margin (Regional Bank Peers)
Slide 9: Net interest margin peer comparison
Note: Peer group includes U.S. regional banks with assets greater than $20 billion and less than $200 billion plus footprint competitors WFC and USB. Source: SNL
Slide 10: NIM Moving Pieces
• Continued strength in DDA balances, strong yields on new loan production • Further reducing negative spread assets - $500 million to $1 billion, or about 1%-2% of earning assets. • As discussed on earnings call, 3Q NIM likely to experience pressure due to capital actions – Swap gain amortization e
Slide 11: Asset Sensitivity
• Fixed-rate loans: – 25% of portfolio – Duration of about 1.1 years • Variable-rate loans: – 75% of portfolio – Continual reduction of interest rate swaps (increasing asset sensitivity) • 22% of total loans have floors that are in-the-money • Non-interest bearing deposits to earning assets is 22% (
Slide 12: Loans with Floors
Amount (in $Millions) Loans with Floors 75 100 125 150 175 200 225 250 275 300+ Basis Points "In the Money"
Slide 13: Agenda: Key Drivers Going Forward
Agenda Key Drivers Going Forward – Net Interest Margin – Credit Quality – Securities Portfolio – Capital Outlook Summary
Slide 14: Loan Portfolio Composition (6/30/2009)
48% 33% 19% Loan Portfolio Composition (6/30/2009)
Slide 15: CRE Portfolio Change Summary
CRE Portfolio Change Summary (Dollar Change from 4Q07 to 2Q09 in billions)
Slide 16: Loan Portfolio Performance (6/30/2009)
Loan Portfolio Performance (6/30/2009)
Slide 17: Loan Portfolio Performance (6/30/2009)
Loan Portfolio Performance (6/30/2009)
Slide 18: NPAs as a % of Total Assets (Large Bank Peers)
Zions NPA/Asset ratio excludes FDIC-supported assets Note: Peer group defined as U.S. bank holding companies with assets > $10 billion. Peer data source: SNL Note: Zions’ ratio excludes FDIC-supported assets NPAs as a % of Total Assets (Large Bank Peers)
Slide 19: Delinquency Trends (Large Bank Peers)
Note: Zions’ ratio excludes FDIC-supported assets Delinquency Trends (Large Bank Peers)
Slide 20: NPAs & Delinquency Trends (Large Bank Peers)
Note: Peer group defined as U.S. bank holding companies with assets > $10 billion. Peer data source: SNL Note: Zions’ ratio excludes FDIC-supported assets NPAs & Delinquency Trends (Large Bank Peers)
Slide 21: Net charge-offs (Large Bank Peers)
*Annualized Note: Peer group defined as U.S. bank holding companies with assets > $10 billion. Peer data source: SNL; 2Q09 peer data estimated from SNL & financial releases
Slide 22: Credit Performance Summary
Credit Performance Summary Compared to Large Banks, Zions has • Relatively – Larger, secured commercial portfolio – Smaller, high performing consumer portfolio • Results in – Higher Non Performing Assets, but – Lower net charge-offs
Slide 23: Net Charge Offs (Regional Bank Peers)
Note: Peer group includes U.S. regional banks with assets greater than $20 billion and less than $200 billion plus footprint competitors WFC and USB. Source: SNL *The C&I Loans category excludes the impact of Flying J. This $47.5 million loan was charged-off in 2Q09, but ZION anticipates a substanti
Slide 24: Reserves & Net Charge Offs (Regional Bank Peers)
Note: Peer group includes U.S. regional banks with assets greater than $20 billion and less than $200 billion plus footprint competitors WFC and USB. Source: SNL Reserves & Net Charge Offs (Regional Bank Peers)
Slide 25: Credit Quality Outlook
Credit Quality Outlook • Weakness in residential construction activity and land values in the Southwest expected to persist through 2009 • Credit problems spreading to other geographies and loan categories as economy weakens • Continued elevated levels of NPAs, provisions and net losses • Continued
Slide 26: Agenda: Key Drivers Going Forward
Agenda Key Drivers Going Forward – Net Interest Margin – Credit Quality – Securities Portfolio – Capital Outlook Summary
Slide 27: Bank & Insurance Trust Preferred CDOs
Bank & Ins. Trup CDOs 3% of Assets
Slide 28: Investment Securities Performance 2Q09
• Credit-related OTTI losses $42.0 million in 2Q09 • Noncredit-related OTTI on securities of $29.5 million in 2Q09 recognized in OCI • Future near-term OTTI losses likely stable – Driven by bank deferrals, defaults, and expected probabilities of default (PDs) – Non-investment grade securities with O
Slide 29: Agenda: Key Drivers Going Forward
Agenda Key Drivers Going Forward – Net Interest Margin – Credit Quality – Securities Portfolio – Capital Outlook Summary
Slide 30: ZION vs. SCAP Baseline Stress Loss Projections
ZION vs. SCAP Baseline Stress Loss Projections (ZION 1HO09 Actual Losses vs. SCAP Baseline $ in millions) First Lien Mortgages Closed-end Junior Liens HELOCs C&l Loans* Construction Multifamily Nonfarm, Non-residential Other CRE Credit Cards Other Consumer Other Loans 0) $200 $400 $600 $800 $1,000 $
Slide 31: ZION vs. SCAP More Adverse Stress Loss Projections
ZION vs. SCAP More Adverse Stress Loss Projections (ZION 1HO09 Actual Losses vs. SCAP More Adverse $ in millions) First Lien Mortgages Closed-end Junior Liens HELOCs C&l Loans* Construction Multifamily Nonfarm, Non-residential Other CRE Credit Cards Other Consumer Other Loans $0 $200 $400 $600 $800
Slide 32: Capital Ratios
2Q08 1Q09 2Q09 Tangible Common Equity 5.51% 5.26% 5.66% Tier 1 Risk Based 7.45% 9.43% 9.66% Total Risk Based 11.58% 13.39% 12.87% Capital Ratios
Slide 33: Outlook Summary
Outlook Summary • Continued elevated levels of credit losses, loss provisions, and some reserve build in a weak economy • Future OTTI losses likely stable, possibly declining • Continued strong core net interest margin, but volatile due to capital actions • Reduced dividend and asset levels will hel
Slide 34: Outlook Summary
Outlook Summary Long-term outlook remains strong when economy begins to recover – Best long-term growth markets – Sustainable competitive advantage in operating model – Superior risk-adjusted NIM through the business cycle
Slide 35: Barclays Capital Global Financial Services Conference
Barclays Capital Global Financial Services Conference 15 September, 2009 New York
Slide 36: Zions Bancorporation
ZIONS BANCORPORATION,
Slide 37: Q2 2009 Earnings Highlights
Million $ Per Share Net Income To Common ($41) ($.35) Goodwill Impairment $0 $0 Valuation Loss on Purchased Securities* ($12) ($.10) OTTI Impairment on Securities ($42) Provisions For Credit Losses $763 Net Charge-offs $347 OREO Expense $24 Core Pretax Income (ex provision, impairment, OREO exp, & n
Slide 38: NPAs as a % of Total Assets (Regional Bank Peers)
Zions NPA/Asset ratio excludes FDIC-supported assets NPAs as a % of Total Assets (Regional Bank Peers) Note: Peer group includes U.S. regional banks with assets greater than $20 billion and less than $200 billion plus footprint competitors WFC and USB. Source: SNL
Slide 39: Delinquency Trends (Regional Bank Peers)
90 + Days Delinquent Still Accruing / Total Net Loans Delinquency Trends (Regional Bank Peers) Note: Peer group includes U.S. regional banks with assets greater than $20 billion and less than $200 billion plus footprint competitors WFC and USB. Source: SNL
Slide 40: NPAs & Delinquency Trends (Regional Bank Peers)
NPAs + Greater than 90 Days Delinquent / Loans + OREO Note: Peer group includes U.S. regional banks with assets greater than $20 billion and less than $200 billion plus footprint competitors WFC and USB. Source: SNL NPAs & Delinquency Trends (Regional Bank Peers)
Slide 41: Net Charge-offs as % of Loans (Regional Bank Peers)
*Annualized Note: Peer group includes U.S. regional banks with assets greater than $20 billion and less than $200 billion plus footprint competitors WFC and USB. Source: SNL Net Charge-offs as % of Loans* (Regional Bank Peers)
Slide 42: CRE Portfolio Composition
CRE Portfolio Composition Loans by Product Type and Location - 6/30/09
Slide 43: CRE Portfolio Change
CRE Portfolio Change (Dollar Change from 4Q07 to 2Q09 in $000s)
Zions Bancorporation — Barclays Capital Global Financial Services Conference 2009 on 6ix