Strong Year‑over‑Year Earnings Growth
Net earnings of $232 million, or $1.56 per diluted share, up 37% versus the year‑ago quarter (driven by revenue growth, a lower provision for credit losses and a lower effective tax rate).
Zions Bancorporation National Association
· ZION
April 20th, 2026
Summary
- Earnings Call Date:
- 2026-04-20
- Change Since:
- +10.80%
- Next Earnings Date:
- 2026-07-20
Earnings Call Sentiment
PositiveThe call presented stronger year‑over‑year financial performance, solid credit metrics, deposit growth at period‑end, capital strength and strategic progress in Capital Markets and product launches. The main near‑term headwinds are seasonal and quarter‑over‑quarter compressions in revenue and margin, higher compensation/expense seasonality, some deposit competition and localized CRE/C&I pricing pressure. Management provided constructive guidance for net interest income (7–8% upside in a no‑rate‑cut scenario), reiterated positive operating leverage for the year and highlighted strategic initiatives and potential regulatory capital tailwinds (Basel III end‑game). Overall, the positive YoY improvements, low credit losses and strategic momentum materially outweigh the QoQ softness and expense seasonality concerns.
Company Guidance
Management guided that net interest income is expected to be “moderately increasing,” with a one‑year NII growth estimate of about 7–8% assuming the forward curve at 3/31 (no rate changes); adjusted customer‑related fee income is also expected to be moderately higher versus Q1 2026’s $174 million (management expects results toward the top of that range); adjusted noninterest expense (Q1 was $558 million) is guided to be moderately increasing year‑over‑year while the firm still targets full‑year 2026 positive operating leverage of 100–150 basis points (Q1 delivered roughly 270 bps of positive operating leverage versus the year‑ago quarter); management expects continued loan growth (Q1 average loans grew 2.4% annualized and 2.5% YoY) and margin expansion to drive NII (Q1 NIM was 3.27%), with supporting balance‑sheet metrics including period‑end customer deposits up $1.3 billion (1.8% from year‑end), total funding costs at 1.68% (down 8 bps linked quarter), CET1 at 11.5% and modeled Basel III end‑game RWA relief of ~9–10% (roughly +93 bps to CET1) over time.
Improved Net Interest Income and Margin Year‑over‑Year
Taxable equivalent net interest income of $662 million, up 6% year‑over‑year. Net interest margin (NIM) of 3.27%, up 17 basis points year‑over‑year.
Loan Growth
Average loans grew 2.4% on an annualized basis during the quarter and 2.5% year‑over‑year, led by commercial lending.
Deposit and Funding Progress
Period‑end customer deposits increased $1.3 billion (1.8%) from year‑end; total funding costs declined 8 basis points linked‑quarter to 1.68% as repricing reduced deposit costs and replaced higher‑cost wholesale funding.
Strong Credit Metrics
Net charge‑offs were very modest at 3 basis points annualized of average loans; nonperforming assets ratio declined to 48 basis points; allowance for credit losses at 1.16% with coverage of nonaccrual loans at 239%.
Capital Strength and Tangible Book Value
Common Equity Tier 1 (CET1) ratio remained solid at 11.5% (flat QoQ). Tangible book value per share increased 19% year‑over‑year, reflecting earnings and balance sheet normalization.
Fee Income Momentum & Capital Markets Investment
Adjusted customer‑related noninterest income of $174 million (up $16 million or 10% YoY excluding CVA), with Capital Markets highlighted as an outsized contributor and strong pipelines into Q2. Continued investment in investment banking, sales & trading and real estate capital markets.
Strategic Acquisitions and Product Launches
Agreement to acquire Basis Investment Group's Fannie/Freddie lending programs (expected to strengthen CRE capabilities). New consumer 'Gold' account and pilot 'beyond the business' small business product launched, plus strong SBA 7(a) momentum (ranked 11th nationally in approvals in the first half of the SBA fiscal year).
Liquidity & Securities Cash Flows
Investment securities principal and prepayment cash flows of $493 million with $299 million reinvested; portfolio price sensitivity ~3.7 years, used as an on‑balance liquidity tool and to balance interest rate risk.
Positive Operating Leverage Outlook
Reported adjusted pre‑provision net revenue of $301 million (up 13% YoY) and reiterated full‑year 2026 expectation for positive operating leverage in the range of 100–150 basis points (management noted even stronger intra‑quarter dynamics earlier).
Operator
Greetings, and welcome to Zions Bancorp's First Quarter Earnings Conference Call. [Operator Instructions]. Please note that this conference is being recorded. It is now my pleasure to turn the conference over to Andrea Christoffersen. Thank you. You may begin.
Andrea Christoffersen
Thank you, Julian, and good evening, everyone. Welcome to our conference call to discuss Zions Bancorporation's First Quarter 2026 Results. My name is Andrea Christoffersen, Director of Investor Relations. Before we begin, I would like to remind you that during this call, we will make forward-looking statements. Actual results may differ materially. We encourage you to review the forward-looking statements and non-GAAP disclosures in our press release and on Slide 2 of today's presentation, which apply equally to statements made during this call. A copy of the earnings release and presentation are available at zionsbancorporation.com. For our agenda today, Chairman and Chief Executive Officer, Harris Simmons, will provide opening remarks.
Following Harris' comments, Chief Financial Officer, Ryan Richards, will review our financial results and outlook. Also with us today are Scott McLean, President and Chief Operating Officer; Derek Steward, Chief Credit Officer; and Chris Kyriakakis, Chief Risk Officer. After our prepared remarks, we will hold a question-and-answer session. This call is scheduled for 1 hour. I will now turn the time over to Harris.
Harris Simmons
Thanks very much, Andrea, and good evening, everyone. We are reasonably pleased with our performance and financial results for the first quarter, which reflect meaningful ye...
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