Zions Bancorporation Reports Earnings Of $0.48 Per Diluted Common Share For First Quarter 2013

Apr 22, 2013, 16:10 ET from Zions Bancorporation


SALT LAKE CITY, April 22, 2013 /PRNewswire/ -- Zions Bancorporation (NASDAQ: ZION) ("Zions" or "the Company") today reported first quarter net earnings applicable to common shareholders of $88.3 million or $0.48 per diluted common share, compared to $35.6 million or $0.19 per diluted share for the fourth quarter of 2012, and $25.5 million or $0.14 per diluted share for the first quarter of 2012.

First Quarter 2013 Highlights

  • Loans and leases, excluding FDIC-supported loans, increased $148 million to $37.3 billion at March 31, 2013. Average loans and leases, excluding FDIC-supported loans, increased $413 million.
  • Gross loan and lease charge-offs declined 35% compared to the fourth quarter, while net loan and lease charge-offs declined 5%. Other improvements in credit quality were generally consistent with prior quarters. 
  • The continued improvement in credit quality resulted in first quarter negative provisions of $29.0 million for loan losses and $6.4 million for unfunded lending commitments.
  • Tangible common equity per common share improved $0.72 to $21.67 from $20.95 in the fourth quarter, driven by increased retained earnings and improvement in accumulated other comprehensive income ("AOCI").
  • Net interest income decreased compared to the prior quarter due to reduced day count and loan interest rates resetting at lower levels.

"We are again pleased with our improvement in credit quality, which we expect to continue, and by somewhat better loan growth over the past couple of quarters," said Harris H. Simmons, chairman and chief executive officer, "but we see some renewed signs of new loan pricing pressure. However, we do expect continued bottom line improvement as we take numerous actions over the next several quarters to reduce the cost of our capital and debt financing."

Loans

Loans and leases, excluding loans held for sale and FDIC-supported loans, increased $148 million on a net basis to $37.3 billion at March 31, 2013, compared to $37.1 billion at December 31, 2012. The increases were predominantly in commercial and industrial, construction and land development, and 1-4 family residential loans primarily in Texas and California. Decreases of $258 million primarily in commercial owner occupied, term commercial real estate, and home equity credit line loans partially offset increases in other loan categories. Average loans and leases, excluding FDIC-supported loans, increased $413 million to $37.1 billion during the first quarter of 2013, compared to $36.7 billion during the fourth quarter of 2012.

Deposits

Average total deposits for the first quarter of 2013 decreased $0.5 billion, or 1%, to $44.4 billion, compared to $44.9 billion for the fourth quarter of 2012. Average noninterest-bearing demand deposits declined $0.7 billion, to $17.2 billion in the first quarter from $17.9 billion in the fourth quarter, while average interest-bearing deposits increased $0.2 billion, to $27.2 billion from $27.0 billion quarter over quarter. The ratio of average loans excluding loans held for sale to average deposits was 85% at March 31, 2013, compared to 83% at December 31, 2012.

Debt and Shareholders' Equity

As previously reported, on January 31, 2013, the Company sold $171.8 million of its Series G Fixed/Floating Rate Non-Cumulative Perpetual Preferred Stock. Dividends are payable from the issuance date to March 14, 2023 at an annual rate of 6.30%. Beginning March 15, 2023 (date of earliest redemption) to maturity, dividends will be payable at an annual floating rate equal to three-month LIBOR plus 4.24%. Net of commissions and fees, the proceeds added $168.8 million to shareholders' equity and Tier 1 capital.

The tangible common equity ratio was 7.53% at March 31, 2013, compared to 7.09% at December 31, 2012. The increase was primarily due to increased retained earnings this quarter, a $39 million improvement in AOCI which resulted primarily from increased fair values on collateralized debt obligation ("CDO") securities, and lower cash-related balances. The estimated common equity Tier 1 capital ratio was 10.06% at March 31, 2013, compared to 9.80% at December 31, 2012.

As previously announced, on May 3, 2013, Zions Capital Trust B will redeem all of its 8.0% outstanding trust preferred securities, or 11.4 million shares, at 100% of their $25 per share liquidation amount for a total of $285 million.

Net Interest Income

Net interest income decreased to $418 million for the first quarter of 2013, compared to $430 million for the fourth quarter of 2012. The net interest margin decreased to 3.44% in the first quarter of 2013, compared to 3.47% in the fourth quarter of 2012. The major drivers of these declines were loan rate resets, expiration of in-the-money floors on loans, reduced day count (for net interest income), and lower yields on available-for-sale investment securities. The cost of interest-bearing deposits continued to decline and was 0.23% in the first quarter compared to 0.25% in the fourth quarter.

Noninterest Income

Noninterest income for the first quarter of 2013 was $121.2 million, compared to $54.2 million for the fourth quarter of 2012. The increase was primarily due to the reduced amount of other-than-temporary impairment ("OTTI") on CDO securities taken this quarter compared to the previous quarter.

CDO Investment Securities

During the first quarter of 2013, the Company recognized credit-related OTTI on CDOs of $10.1 million or $0.03 per diluted share, compared to $83.8 million or $0.28 per diluted share during the fourth quarter of 2012. Approximately $6.2 million of the OTTI this quarter was related to an event of default on one CDO. The higher amount of OTTI in the previous quarter resulted from increases to our assumed probabilities of default, primarily on bank issuers deferring payment of trust preferred interest, and to our near-term prepayment assumptions for some banks. Gains from cash principal payments on CDOs previously written down were $3.3 million in the first quarter of 2013, compared to $10.2 million in the fourth quarter of 2012.

The following table provides fair value and other information on the CDOs, stratified into performing tranches without credit impairment and nonperforming tranches at March 31, 2013:

March 31, 2013

Net unrealized losses recognized in AOCI 1

% of carrying value to par

(Amounts in millions)

No. of tranches

Par amount

Amortized cost

Carrying value

Weighted average discount rate 2

 

March 31, 2013

December 31, 2012

 

Change

Performing CDOs

Predominantly bank CDOs

27

$

774

$

694

$

560

$

(134)

5.9%

72%

66%

6%

Insurance-only CDOs

22

447

443

331

(112)

7.9%

74%

72%

2%

Other CDOs

6

51

40

37

(3)

9.6%

73%

70%

3%

Total performing CDOs

55

1,272

1,177

928

(249)

6.7%

73%

68%

5%

Nonperforming CDOs 3

CDOs credit impaired prior to last 12 months

19

394

275

126

(149)

10.1%

32%

30%

2%

CDOs credit impaired during last 12 months

39

732

432

179

(253)

11.4%

24%

25%

(1)%

Total nonperforming CDOs

58

1,126

707

305

(402)

11.0%

27%

26%

1%

Total CDOs

113

$

2,398

$

1,884

$

1,233

$

(651)

8.7%

51%

49%

2%

Amounts presented are pretax.

Margin over related LIBOR index.

Defined as either deferring current interest ("PIKing") or OTTI; the majority are predominantly bank CDOs.

The net unrealized pretax losses in AOCI improved to $651 million in the first quarter of 2013 from $718 million in the fourth quarter of 2012 due to fair value increases that occurred primarily in senior tranches and were driven by continued improvement in credit spreads.

Noninterest Expense

Noninterest expense for the first quarter of 2013 was $397.3 million compared to $407.0 million for the fourth quarter of 2012. The decrease was due primarily to a $7.3 million reduction in the provision for unfunded lending commitments, and to reduced levels of other real estate expense and legal and professional services compared to the fourth quarter. These were partially offset by increased salaries and employee benefits due to increased payroll taxes and variable compensation accruals. Other noninterest expense was approximately $9.7 million higher this quarter than the previous quarter due to increased amortization of the FDIC indemnification asset from loan prepayments.

Asset Quality

Gross loan and lease charge-offs declined 35% to $35.5 million in the first quarter of 2013, compared to $54.7 million in the fourth quarter of 2012; gross charge-offs declined 56% from the first quarter of 2012. Net loan and lease charge-offs decreased 5% in the first quarter of 2013, compared to the fourth quarter of 2012. Net charge-offs declined primarily in consumer home equity credit line and term commercial real estate loans.

Nonperforming lending-related assets declined 8% to $684 million at March 31, 2013 from $746 million at December 31, 2012. Nonaccrual loans declined 8% to $594 million at March 31, 2013 from $648 million at December 31, 2012. The ratio of nonperforming lending-related assets to loans and leases and other real estate owned decreased to 1.80% at March 31, 2013, compared to 1.96% at December 31, 2012.

Classified loans, excluding FDIC-supported loans, decreased approximately 2% to $1.74 billion at March 31, 2013, compared to $1.77 billion at December 31, 2012. Approximately 80% of classified loans were current as to principal and interest for the first quarter of 2013, compared to 79% for the fourth quarter of 2012, and 73% for the first quarter of 2012.

The provision (credit) for loan losses was $(29.0) million for the first quarter of 2013, compared to $(10.4) million for the fourth quarter of 2012. The decline in the provision was driven by the continued improvement in credit quality, including continued improvement in loss severity from classified loans. The allowance for credit losses was $0.9 billion, or 2.50% of loans and leases at March 31, 2013, compared to $1.0 billion, or 2.66% of loans and leases at December 31, 2012.

Conference Call

Zions will host a conference call to discuss these first quarter results at 5:30 p.m. ET this afternoon (April 22, 2013). Media representatives, analysts and the public are invited to listen to this discussion by calling 253-237-1247 (domestic and international) and entering the passcode 24666556, or via on-demand webcast. A link to the webcast will be available on the Zions Bancorporation website at www.zionsbancorporation.com. A replay of the call will be available from approximately 7:30 p.m. ET on Monday, April 22, 2013, until midnight ET on Monday, April 29, 2013, by dialing 855-859-2056 (domestic and international) and entering the same passcode. The webcast of the conference call will also be archived and available for 30 days.

About Zions Bancorporation

Zions Bancorporation is one of the nation's premier financial services companies, consisting of a collection of great banks in select Western markets. Zions operates its banking businesses under local management teams and community identities through approximately 480 offices in 10 Western and Southwestern states: Arizona, California, Colorado, Idaho, Nevada, New Mexico, Oregon, Texas, Utah and Washington. The Company is a national leader in Small Business Administration lending and public finance advisory services, and received 13 "Excellence" awards by Greenwich Associates for the 2012 survey. In addition, Zions is included in the S&P 500 and NASDAQ Financial 100 indices. Investor information and links to subsidiary banks can be accessed at www.zionsbancorporation.com.

Forward-Looking Information

Statements in this press release that are based on other than historical data or that express the Company'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 provide current expectations or forecasts of future events or determinations. These forward-looking statements are not guarantees of future performance or determinations, nor should they be relied upon as representing management's views as of any subsequent date. Forward-looking statements involve significant risks and uncertainties and actual results may differ materially from those presented, either expressed or implied, in this press release. Factors that might cause such differences include, but are not limited to: the Company's ability to successfully execute its business plans and achieve its objectives; changes in general economic and financial market conditions, either internationally, nationally or locally in areas in which the Company conducts its operations, including changes in securities markets and valuations in structured securities and other assets; changes in governmental policies and programs resulting from general economic and financial market conditions; changes in interest and funding rates; continuing consolidation in the financial services industry; new private and governmental legal actions or changes in existing private and governmental legal actions; increased competitive challenges and expanding product and pricing pressures among financial institutions; legislation or regulatory changes which adversely affect the Company's operations or business (including The Dodd-Frank Wall Street Reform and Consumer Protection Act); and changes in accounting policies, procedures or determinations as may be required by the Financial Accounting Standards Board or other regulatory agencies.

Additional factors that could cause actual results to differ materially from those expressed in the forward-looking statements are discussed in Zions Bancorporation's most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission ("SEC") and available at the SEC's Internet site (http://www.sec.gov).

Except as required by law, the Company 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.

FINANCIAL HIGHLIGHTS (Unaudited)

Three Months Ended

(In thousands, except share, per share, and ratio data)

March 31, 2013

December 31, 2012

September 30, 2012

June 30, 2012

March 31, 2012

PER COMMON SHARE

Dividends

$

0.01

$

0.01

$

0.01

$

0.01

$

0.01

Book value per common share 1

27.43

26.73

26.05

25.48

25.25

Tangible common equity per common share 1

21.67

20.95

20.24

19.65

19.39

SELECTED RATIOS

Return on average assets

0.83%

0.43%

0.82%

0.70%

0.69%

Return on average common equity

7.18%

2.91%

5.21%

4.71%

2.21%

Tangible return on average tangible common equity

9.37%

4.07%

7.02%

6.41%

3.18%

Net interest margin

3.44%

3.47%

3.58%

3.56%

3.69%

Capital Ratios

Tangible common equity ratio 1

7.53%

7.09%

7.17%

6.91%

6.89%

Tangible equity ratio 1

9.97%

9.15%

9.32%

10.35%

10.24%

Average equity to average assets

11.54%

11.03%

12.22%

12.37%

13.31%

Risk-Based Capital Ratios 1,2

Common equity Tier 1 capital

10.06%

9.80%

9.86%

9.78%

9.71%

Tier 1 leverage

11.56%

10.96%

11.05%

12.31%

12.17%

Tier 1 risk-based capital

14.04%

13.38%

13.49%

15.03%

14.83%

Total risk-based capital

15.72%

15.05%

15.25%

16.89%

16.76%

Taxable-equivalent net interest income

$

422,252

$

434,252

$

442,595

$

430,967

$

442,340

Weighted average common and common-equivalent shares outstanding

183,655,129

183,456,109

183,382,650

183,136,631

182,963,828

Common shares outstanding 1

184,246,471

184,199,198

184,156,402

184,117,522

184,228,178

At period end.

Ratios for March 31, 2013 are estimates.

 

CONSOLIDATED BALANCE SHEETS

(In thousands, except share amounts)

March 31, 2013

December 31, 2012

September 30, 2012

June 30, 2012

March 31, 2012

(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)

ASSETS

Cash and due from banks

$

928,817

$

1,841,907

$

1,060,918

$

1,124,673

$

1,082,186

Money market investments:

Interest-bearing deposits

5,785,268

5,978,978

5,519,463

7,887,175

7,629,399

Federal funds sold and security resell agreements

2,340,177

2,775,354

1,960,294

83,529

52,634

Investment securities:

Held-to-maturity, at adjusted cost (approximate fair value $684,668, $674,741, $655,768, $715,710, and $728,479)

736,158

756,909

740,738

773,016

797,149

Available-for-sale, at fair value

3,287,844

3,091,310

3,127,192

3,167,590

3,223,086

Trading account, at fair value

28,301

28,290

13,963

20,539

19,033

4,052,303

3,876,509

3,881,893

3,961,145

4,039,268

Loans held for sale

161,559

251,651

220,240

139,245

184,579

Loans, net of unearned income and fees:

Loans and leases

37,284,694

37,137,006

36,674,288

36,319,596

35,998,928

FDIC-supported loans

477,725

528,241

588,566

642,246

687,126

37,762,419

37,665,247

37,262,854

36,961,842

36,686,054

Less allowance for loan losses

841,781

896,087

927,068

973,443

1,011,786

Loans, net of allowance

36,920,638

36,769,160

36,335,786

35,988,399

35,674,268

Other noninterest-bearing investments

855,388

855,462

874,903

867,882

875,037

Premises and equipment, net

706,746

708,882

709,188

714,913

715,815

Goodwill

1,014,129

1,014,129

1,015,129

1,015,129

1,015,129

Core deposit and other intangibles

47,000

50,818

55,034

59,277

63,538

Other real estate owned

89,904

98,151

118,190

144,816

158,592

Other assets

1,208,635

1,290,917

1,335,963

1,420,829

1,405,862

$

54,110,564

$

55,511,918

$

53,087,001

$

53,407,012

$

52,896,307

LIABILITIES AND SHAREHOLDERS' EQUITY

Deposits:

Noninterest-bearing demand

$

17,311,150

$

18,469,458

$

17,295,911

$

16,498,248

$

16,185,140

Interest-bearing:

Savings and money market

22,760,397

22,896,624

21,970,062

21,945,230

22,220,405

Time

2,889,903

2,962,931

3,107,815

3,211,942

3,326,717

Foreign

1,528,745

1,804,060

1,398,749

1,504,827

1,366,826

44,490,195

46,133,073

43,772,537

43,160,247

43,099,088

Securities sold, not yet purchased

1,662

26,735

21,708

104,882

47,404

Federal funds purchased and security repurchase agreements

325,107

320,478

451,214

759,591

486,808

Other short-term borrowings

5,409

6,608

7,621

19,839

Long-term debt

2,352,569

2,337,113

2,326,659

2,274,571

2,283,121

Reserve for unfunded lending commitments

100,455

106,809

105,850

103,586

98,718

Other liabilities

489,923

533,660

484,170

507,151

474,551

Total liabilities

47,759,911

49,463,277

47,168,746

46,917,649

46,509,529

Shareholders' equity:

Preferred stock, without par value, authorized 4,400,000 shares

1,301,289

1,128,302

1,123,377

1,800,473

1,737,633

Common stock, without par value; authorized 350,000,000 shares; issued and outstanding 184,246,471, 184,199,198, 184,156,402, 184,117,522, and 184,228,178 shares

4,170,888

4,166,109

4,162,001

4,157,525

4,162,522

Retained earnings

1,290,131

1,203,815

1,170,477

1,110,120

1,060,525

Accumulated other comprehensive income (loss)

(406,903)

(446,157)

(534,738)

(576,147)

(571,567)

Controlling interest shareholders' equity

6,355,405

6,052,069

5,921,117

6,491,971

6,389,113

Noncontrolling interests

(4,752)

(3,428)

(2,862)

(2,608)

(2,335)

Total shareholders' equity

6,350,653

6,048,641

5,918,255

6,489,363

6,386,778

$

54,110,564

$

55,511,918

$

53,087,001

$

53,407,012

$

52,896,307

 

CONSOLIDATED STATEMENTS OF INCOME

 

(Unaudited)

Three Months Ended

(In thousands, except per share amounts)

March 31, 2013

December 31, 2012

September 30, 2012

June 30, 2012

March 31, 2012

Interest income:

Interest and fees on loans

$

453,433

$

462,002

$

473,162

$

472,926

$

481,794

Interest on money market investments

5,439

6,004

5,349

5,099

4,628

Interest on securities:

Held-to-maturity

7,974

8,130

8,337

9,325

8,959

Available-for-sale

17,712

21,971

22,042

25,090

23,158

Trading account

190

150

110

148

338

Total interest income

484,748

498,257

509,000

512,588

518,877

Interest expense:

Interest on deposits

15,642

16,861

19,049

20,823

23,413

Interest on short-term borrowings

92

178

193

256

779

Interest on long-term debt

50,899

51,261

51,597

65,165

57,207

Total interest expense

66,633

68,300

70,839

86,244

81,399

Net interest income

418,115

429,957

438,161

426,344

437,478

Provision for loan losses

(29,035)

(10,401)

(1,889)

10,853

15,664

Net interest income after provision for loan losses

447,150

440,358

440,050

415,491

421,814

Noninterest income:

Service charges and fees on deposit accounts

43,580

44,492

44,951

43,426

43,532

Other service charges, commissions and fees

42,731

46,497

44,679

44,197

39,047

Trust and wealth management income

6,994

7,450

6,521

8,057

6,374

Capital markets and foreign exchange

7,486

7,708

6,026

7,342

5,734

Dividends and other investment income

12,724

13,117

11,686

21,542

9,480

Loan sales and servicing income

10,951

10,595

10,695

10,287

8,352

Fair value and nonhedge derivative loss

(5,445)

(4,778)

(5,820)

(6,784)

(4,400)

Equity securities gains (losses), net

2,832

(682)

2,683

107

9,145

Fixed income securities gains, net

3,299

10,259

3,046

5,519

720

Impairment losses on investment securities:

Impairment losses on investment securities

(31,493)

(120,082)

(3,876)

(24,026)

(18,273)

Noncredit-related losses on securities not expected to be sold (recognized in other comprehensive income)

21,376

36,274

1,140

16,718

8,064

Net impairment losses on investment securities

(10,117)

(83,808)

(2,736)

(7,308)

(10,209)

Other

6,184

3,309

3,495

2,280

4,045

Total noninterest income

121,219

54,159

125,226

128,665

111,820

Noninterest expense:

Salaries and employee benefits

229,789

220,039

220,223

220,765

224,634

Occupancy, net

27,389

28,226

28,601

28,169

27,951

Furniture and equipment

26,074

27,774

27,122

27,302

26,792

Other real estate expense

1,977

5,266

207

6,440

7,810

Credit related expense

10,482

11,302

13,316

12,415

13,485

Provision for unfunded lending commitments

(6,354)

959

2,264

4,868

(3,704)

Legal and professional services

10,471

15,717

12,749

12,947

11,096

Advertising

5,893

5,969

7,326

6,618

5,807

FDIC premiums

9,711

10,760

11,278

10,444

10,919

Amortization of core deposit and other intangibles

3,819

4,216

4,241

4,262

4,291

Other

78,097

76,786

67,648

67,426

63,291

Total noninterest expense

397,348

407,014

394,975

401,656

392,372

Income before income taxes

171,021

87,503

170,301

142,500

141,262

Income taxes

60,634

29,817

60,704

51,036

51,859

Net income

110,387

57,686

109,597

91,464

89,403

Net loss applicable to noncontrolling interests

(336)

(566)

(254)

(273)

(273)

Net income applicable to controlling interest

110,723

58,252

109,851

91,737

89,676

Preferred stock dividends

(22,399)

(22,647)

(47,529)

(36,522)

(64,187)

Net earnings applicable to common shareholders

$

88,324

$

35,605

$

62,322

$

55,215

$

25,489

Weighted average common shares outstanding during the period:

Basic shares

183,396

183,300

183,237

182,985

182,798

Diluted shares

183,655

183,456

183,383

183,137

182,964

Net earnings per common share:

Basic

$

0.48

$

0.19

$

0.34

$

0.30

$

0.14

Diluted

0.48

0.19

0.34

0.30

0.14

 

 

Loan Balances by Portfolio Type

(Unaudited)

(In millions)

March 31, 2013

December 31, 2012

September 30, 2012

June 30, 2012

March 31, 2012

Commercial:

Commercial and industrial

$

11,504

$

11,257

$

10,840

$

10,471

$

10,253

Leasing

390

423

405

406

394

Owner occupied

7,501

7,589

7,669

7,811

7,886

Municipal

484

494

469

477

441

Total commercial

19,879

19,763

19,383

19,165

18,974

Commercial real estate:

Construction and land development

2,039

1,939

1,956

2,099

2,100

Term

8,012

8,063

8,140

8,012

8,070

Total commercial real estate

10,051

10,002

10,096

10,111

10,170

Consumer:

Home equity credit line

2,125

2,178

2,175

2,181

2,167

1-4 family residential

4,408

4,350

4,181

4,019

3,875

Construction and other consumer real estate

320

321

320

328

316

Bankcard and other revolving plans

293

307

295

284

274

Other

208

216

224

232

223

Total consumer

7,354

7,372

7,195

7,044

6,855

FDIC-supported loans 1

478

528

589

642

687

Total loans

$

37,762

$

37,665

$

37,263

$

36,962

$

36,686

1 FDIC-supported loans represent loans acquired from the FDIC subject to loss sharing agreements.

FDIC-Supported Loans – Effect of Higher Accretion

and Impact on FDIC Indemnification Asset

(Unaudited)

(In thousands)

March 31, 2013

December 31, 2012

September 30, 2012

June 30, 2012

March 31, 2012

Balance sheet:

Change in assets from reestimation of cash flows – increase (decrease):

FDIC-supported loans

$

18,977

$

12,970

$

17,594

$

14,761

$

13,171

FDIC indemnification asset (included in other assets)

(20,288)

(10,610)

(14,401)

(11,233)

(10,002)

Balance at end of period:

FDIC-supported loans

477,725

528,241

588,566

642,246

687,126

FDIC indemnification asset (included in other assets)

71,100

90,074

100,004

117,167

123,862

Three Months Ended

(In thousands)

March 31, 2013

December 31, 2012

September 30, 2012

June 30, 2012

March 31, 2012

Statement of income:

Interest income:

Interest and fees on loans

$

18,977

$

12,970

$

17,594

$

14,761

$

13,171

Noninterest expense:

Other noninterest expense

20,288

10,610

14,401

11,233

10,002

Net increase (decrease) in pretax income

$

(1,311)

$

2,360

$

3,193

$

3,528

$

3,169

 

 

Nonperforming Lending-Related Assets

(Unaudited)

(Amounts in thousands)

March 31, 2013

December 31, 2012

September 30, 2012

June 30, 2012

March 31, 2012

Nonaccrual loans

$

589,221

$

630,810

$

699,952

$

771,510

$

849,543

Other real estate owned

80,701

90,269

106,356

125,142

129,676

Nonperforming lending-related assets, excluding FDIC-supported assets

669,922

721,079

806,308

896,652

979,219

FDIC-supported nonaccrual loans

4,927

17,343

19,454

21,980

22,623

FDIC-supported other real estate owned

9,203

7,882

11,834

19,674

28,916

FDIC-supported nonperforming assets

14,130

25,225

31,288

41,654

51,539

Total nonperforming lending-related assets

$

684,052

$

746,304

$

837,596

$

938,306

$

1,030,758

Ratio of nonperforming lending-related assets to loans 1 and leases and other real estate owned

1.80%

1.96%

2.23%

2.52%

2.78%

Accruing loans past due 90 days or more, excluding FDIC-supported loans

$

12,708

$

9,730

$

14,508

$

29,460

$

38,172

Accruing FDIC-supported loans past due 90 days or more

47,208

52,033

60,913

70,453

76,945

Ratio of accruing loans past due 90 days or more to loans 1 and leases

0.16%

0.16%

0.20%

0.27%

0.31%

Nonaccrual loans and accruing loans past due 90 days or more

$

654,064

$

709,916

$

794,827

$

893,403

$

987,283

Ratio of nonaccrual loans and accruing loans past due 90 days or more to loans 1 and leases

1.72%

1.87%

2.12%

2.41%

2.68%

Accruing loans past due 30 - 89 days, excluding FDIC-supported loans

$

155,896

$

185,422

$

143,539

$

142,501

$

171,224

Accruing FDIC-supported loans past due 30 - 89 days

11,571

11,924

15,462

15,519

13,899

Restructured loans included in nonaccrual loans

193,975

215,476

207,088

227,568

276,669

Restructured loans on accrual

416,181

407,026

421,055

393,360

401,554

Classified loans, excluding FDIC-supported loans

1,737,178

1,767,460

1,810,099

1,880,932

2,076,220

Includes loans held for sale.

 

Allowance for Credit Losses

(Unaudited)

Three Months Ended

(Amounts in thousands)

March 31, 2013

December 31, 2012

September 30, 2012

June 30, 2012

March 31, 2012

Allowance for Loan Losses

Balance at beginning of period

$

896,087

$

927,068

$

973,443

$

1,011,786

$

1,051,685

Add:

Provision for losses

(29,035)

(10,401)

(1,889)

10,853

15,664

Adjustment for FDIC-supported loans

(7,429)

(1,721)

(5,908)

(5,856)

(1,057)

Deduct:

Gross loan and lease charge-offs

(35,467)

(54,709)

(58,781)

(73,685)

(80,014)

Recoveries

17,625

35,850

20,203

30,345

25,508

Net loan and lease charge-offs

(17,842)

(18,859)

(38,578)

(43,340)

(54,506)

Balance at end of period

$

841,781

$

896,087

$

927,068

$

973,443

$

1,011,786

Ratio of allowance for loan losses to loans and leases, at period end

2.23%

2.38%

2.49%

2.63%

2.76%

Ratio of allowance for loan losses to nonperforming loans, at period end

141.68%

138.25%

128.87%

122.68%

116.01%

Annualized ratio of net loan and lease charge-offs to average loans

0.19%

0.20%

0.41%

0.47%

0.59%

Reserve for Unfunded Lending Commitments

Balance at beginning of period

$

106,809

$

105,850

$

103,586

$

98,718

$

102,422

Provision charged (credited) to earnings

(6,354)

959

2,264

4,868

(3,704)

Balance at end of period

$

100,455

$

106,809

$

105,850

$

103,586

$

98,718

Total Allowance for Credit Losses

Allowance for loan losses

$

841,781

$

896,087

$

927,068

$

973,443

$

1,011,786

Reserve for unfunded lending commitments

100,455

106,809

105,850

103,586

98,718

Total allowance for credit losses

$

942,236

$

1,002,896

$

1,032,918

$

1,077,029

$

1,110,504

Ratio of total allowance for credit losses to loans and leases outstanding, at period end

2.50%

2.66%

2.77%

2.91%

3.03%

 

Nonaccrual Loans by Portfolio Type

(Excluding FDIC-Supported Loans)

(Unaudited)

(In millions)

March 31, 2013

December 31, 2012

September 30, 2012

June 30, 2012

March 31, 2012

Loans held for sale

$

$

$

$

$

Commercial:

Commercial and industrial

100

91

103

133

149

Leasing

1

1

1

1

1

Owner occupied

195

206

223

240

245

Municipal

9

9

6

Total commercial

305

307

333

374

395

Commercial real estate:

Construction and land development

93

108

125

115

148

Term

102

125

155

182

191

Total commercial real estate

195

233

280

297

339

Consumer:

Home equity credit line

12

14

12

14

17

1-4 family residential

71

70

66

76

87

Construction and other consumer real estate

4

5

6

8

8

Bankcard and other revolving plans

1

1

1

1

1