Third Quarter 2026
Filed Oct 19, 2026Zions Bancorporation, N.A. reports 3Q26 net earnings of $262 million and diluted EPS of $1.78 compared with 3Q25 net earnings of $221 million and diluted EPS of $1.48.
Third-quarter common earnings increased to $262 million from $221 million as net charge-offs fell to $3 million from $56 million and the provision became an $8 million benefit from a $49 million expense. Net interest income and customer-related fee income grew, while loan growth was flat sequentially, NIM declined, expenses increased, and quarterly results did not include the prior quarter's $269 million securities gains.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Net income, three months ended September 30, 2026GAAP | $263M | – | – |
| Net earnings applicable to common shareholders, three months ended September 30, 2026GAAP | $262M | – | – |
| Diluted net earnings per common share, three months ended September 30, 2026GAAP | $1.78 | – | 20% |
| Net interest income, three months ended September 30, 2026GAAP | $684M | 1% | 2% |
| Net interest margin, three months ended September 30, 2026other | 3.23% | (4) bps | (5) bps |
| Total interest income, three months ended September 30, 2026GAAP | $1.05B | 3% | (2)% |
| Total interest expense, three months ended September 30, 2026GAAP | $362M | 6% | (8)% |
| Yield on interest-earning assets, three months ended September 30, 2026other | 4.91% | 1 bps | (25) bps |
| Rate paid on total deposits and interest-bearing liabilities, three months ended September 30, 2026other | 1.75% | 6 bps | (17) bps |
| Cost of deposits, three months ended September 30, 2026other | 1.59% | 11 bps | (8) bps |
| Total noninterest income, three months ended September 30, 2026GAAP | $197M | (57)% | 4% |
| Customer-related noninterest income, three months ended September 30, 2026GAAP | $192M | 5% | 18% |
| Adjusted customer-related noninterest income, three months ended September 30, 2026non-GAAP | $182M | 1% | 5% |
| Capital markets fees and income, three months ended September 30, 2026GAAP | $46M | 28% | 92% |
| Securities gains (losses), net, three months ended September 30, 2026GAAP | −$4M | NM | NM |
| Total noninterest expense, three months ended September 30, 2026GAAP | $553M | — % | 5% |
| Adjusted noninterest expense, three months ended September 30, 2026non-GAAP | $549M | 1% | 6% |
| Pre-provision net revenue, three months ended September 30, 2026non-GAAP | $340M | – | – |
| Adjusted pre-provision net revenue, three months ended September 30, 2026non-GAAP | $338M | – | – |
| Efficiency ratio, three months ended September 30, 2026non-GAAP | 61.9% | – | – |
| Provision for credit losses, three months ended September 30, 2026GAAP | −$8M | NM | NM |
| Net loan and lease charge-offs, three months ended September 30, 2026other | $3M | (67)% | (95)% |
| Annualized ratio of net loan and lease charge-offs to average loans and leases, three months ended September 30, 2026other | 0.02% | (4) bps | (35) bps |
| Allowance for credit losses, September 30, 2026other | $696M | (2)% | (4)% |
| Ratio of allowance for credit losses to loans and leases outstanding, September 30, 2026other | 1.11% | (2) bps | (9) bps |
| Nonperforming assets, September 30, 2026other | $315M | 6% | (3)% |
| Ratio of nonperforming assets to loans and leases and other real estate owned, September 30, 2026other | 0.50% | 2 bps | (4) bps |
| Classified loans, September 30, 2026other | $2.12B | (9)% | (12)% |
| Ratio of classified loans to total loans and leases, September 30, 2026other | 3.40% | (32) bps | (60) bps |
| Loans and leases, net of unearned income and fees, September 30, 2026other | $62.47B | — | 4% |
| Total deposits, September 30, 2026other | $77.95B | 2% | 4% |
| Customer deposits excluding brokered deposits, September 30, 2026other | $74.46B | 2% | 5% |
| Total borrowed funds, September 30, 2026other | $3.26B | 3% | (35)% |
| Total shareholders' equity, September 30, 2026GAAP | $7.68B | — | 12% |
| Estimated common equity tier 1 capital, September 30, 2026other | $8.27B | – | – |
| Estimated common equity tier 1 capital ratio, September 30, 2026other | 11.8% | – | – |
| Tangible book value per common share, September 30, 2026non-GAAP | $43.50 | – | 13% |
| Return on average tangible common equity, three months ended September 30, 2026non-GAAP | 16.2% | – | – |
| Net earnings applicable to common shareholders, nine months ended September 30, 2026GAAP | $946M | – | – |
| Diluted net earnings per common share, nine months ended September 30, 2026GAAP | $6.39 | – | – |
| Net interest income, nine months ended September 30, 2026GAAP | $2.02B | – | – |
| Total noninterest income, nine months ended September 30, 2026GAAP | $844M | – | – |
| Total noninterest expense, nine months ended September 30, 2026GAAP | $1.67B | – | – |
| Provision for credit losses, nine months ended September 30, 2026GAAP | −$12M | – | – |
| Adjusted pre-provision net revenue, nine months ended September 30, 2026non-GAAP | $971M | – | – |
| Efficiency ratio, nine months ended September 30, 2026non-GAAP | 63.0% | – | – |
Capital returns
- Common dividends paid were $71 million during the third quarter of 2026, compared with $67 million during the third quarter of 2025.
- The common stock dividend was $0.48 per share, compared with $0.45 per share during the third quarter of 2025.
- During the third quarter of 2026, the company repurchased 1.1 million common shares outstanding for $75 million.
- Total capital distributed to common shareholders was $146 million, compared with $67 million in the third quarter of 2025.
What drove it
- Net interest income increased $12 million, or 2%, from the prior-year quarter, driven by lower funding costs and balance-sheet mix, including growth in average loans and leases, money market investments, and deposits.
- Customer-related noninterest income increased $29 million, or 18%, from the prior-year quarter, with broad-based growth across nearly all revenue streams.
- Capital markets fees and income increased $22 million, largely reflecting changes in net CVA; excluding net CVA changes, it increased $1 million due to higher swap fee revenue.
- Loans and leases increased $2.2 billion, or 4%, from the prior-year quarter, led by commercial loans and commercial real estate loans.
- Total deposits increased $3.1 billion, or 4%, from the prior-year quarter, led by interest-bearing deposits and deposit growth initiatives.
- Credit quality improved: the provision was an $8 million benefit and net charge-offs were $3 million, while classified loans declined by $292 million from the prior-year quarter.
- The acquisition of the Basis Multifamily Finance agency lending platform was completed in July 2026.
Concerns
- Net interest margin declined to 3.23% from 3.28% in the prior-year quarter and 3.27% in the preceding quarter.
- Loans and leases were flat sequentially, declining $9 million, as increased loan payoffs and a highly competitive market affected growth.
- Total cost of deposits rose to 1.59% from 1.48% in the preceding quarter, partly due to a shift toward higher-cost interest-bearing deposits and an accounting presentation change.
- Total noninterest expense increased $26 million, or 5%, from the prior-year quarter; adjusted noninterest expense increased $29 million, or 6%.
- Nonperforming assets increased $17 million sequentially to $315 million, although they remained below the prior-year level.
- Tangible book value per common share declined to $43.50 from $44.74 in the preceding quarter, while AOCI decreased by $122 million sequentially.
What to watch
- Whether the moderately asset-sensitive balance sheet produces stronger net interest income if short- and medium-term interest rates remain higher.
- Loan growth after the third quarter's flat sequential balance, including the effects of payoffs and competitive conditions.
- Deposit mix and costs following sequential growth in higher-cost interest-bearing deposits.
- The durability of credit improvement, including nonperforming assets, classified loans, charge-offs, and the allowance ratio.
- Noninterest-income momentum, including capital-markets activity and the recurring contribution from the Basis Multifamily Finance platform.
- Expense growth from compensation, technology, outsourced services, and customer-acquisition and deposit-growth initiatives.
Balance sheet and cash flow
- Cash and due from banks was $727 million at September 30, 2026.
- Total assets were $90,920 million at September 30, 2026.
- Investment securities, net of allowance, were $17,054 million at September 30, 2026, compared with $18,229 million at September 30, 2025.
- Brokered deposits were $3,487 million, compared with $3,824 million at September 30, 2025.
- Federal funds purchased and other short-term borrowings were $843 million, compared with $3,548 million at September 30, 2025.
- Long-term debt was $2,416 million, compared with $1,473 million at September 30, 2025.
- Operating cash flow and free cash flow were not reported.
Analysis
Zions reported third-quarter net earnings applicable to common shareholders of $262 million, or $1.78 per diluted common share, compared with $221 million, or $1.48 per diluted common share, in the third quarter of 2025. The earnings increase was driven primarily by credit costs: the provision for credit losses was an $8 million benefit versus a $49 million expense, while net loan and lease charge-offs declined to $3 million from $56 million. The prior-year quarter included $50 million of charge-offs on revolving credit facilities to two related commercial borrowers.
Core spread revenue improved modestly. Net interest income rose $12 million, or 2%, to $684 million, supported by lower funding costs and growth in average loans, money market investments, and deposits. Deposit growth exceeded loan growth, allowing reduced reliance on higher-cost borrowed funds. However, NIM declined to 3.23% from 3.28% a year earlier and 3.27% sequentially. The cost of deposits was 1.59%, down from 1.67% a year earlier but up from 1.48% in the second quarter due partly to a shift to higher-cost interest-bearing deposits and an accounting presentation change.
Fee trends were favorable. Customer-related noninterest income increased $29 million, or 18%, to $192 million, and adjusted customer-related noninterest income increased $8 million, or 5%, to $182 million. Capital markets fees and income rose $22 million to $46 million, largely from net CVA changes, while wealth management and retail and business banking fees also increased. Total noninterest income was only $197 million because the prior quarter included $269 million of securities gains; securities gains were a $4 million loss in the third quarter.
Loan balances increased $2.2 billion, or 4%, year over year to $62.5 billion but were essentially unchanged from the second quarter. Commercial loans were up 4% year over year and commercial real estate loans were up 5%. Deposits increased $3.1 billion, or 4%, to $77.9 billion, while customer deposits excluding brokered deposits increased $3.4 billion, or 5%, to $74.5 billion. Short-term borrowings declined $2.7 billion, or 76%, from the prior-year quarter, whereas long-term debt increased $943 million, or 64%, following senior note issuances over the past year.
Credit indicators improved year over year, with classified loans down to $2.1 billion from $2.4 billion and the classified-loan ratio declining to 3.40% from 4.00%. Nonperforming assets were $315 million, below $324 million a year earlier but above $298 million sequentially. Expenses increased, with total noninterest expense up 5% to $553 million and adjusted noninterest expense up 6% to $549 million, raising the efficiency ratio to 61.9% from 59.6% a year ago. Capital remained strong with an estimated CET1 ratio of 11.8%, and the company returned $146 million to common shareholders through dividends and repurchases. Management did not provide quantified forward guidance, but stated that it expects stronger net interest income in a higher-rate environment and continued noninterest-income improvement into next year.
Management, verbatim
Third quarter earnings per share increased 20% to $1.78, up from $1.48 a year ago. The higher earnings were primarily a reflection of improved credit quality, as net loan charge-offs were $3 million, down from $56 million a year ago. Although an increased pace of loan payoffs, combined with a highly competitive market, produced flat loan growth compared to the second quarter, customer deposits grew nearly 10% annualized from second quarter levels.
Harris H. Simmons, Chairman and CEO of Zions Bancorporation
Short- and medium-term interest rates began to rise in the last month of the quarter, and we expect that our moderately asset-sensitive balance sheet should produce stronger net interest income in a higher rate environment, while we're seeing continued improvement in noninterest income that we expect will continue into next year.
Harris H. Simmons, Chairman and CEO of Zions Bancorporation
We were pleased to complete the acquisition of Basis Multifamily Finance I, LLC, a subsidiary of Basis Investment Group, at the end of July. This multifamily finance platform becomes an important strategic advantage in serving our commercial real estate clients, particularly in the fast-growing western markets we serve.
Harris H. Simmons, Chairman and CEO of Zions Bancorporation
Not in the filing
stated, not guessed- Quantified forward guidance for revenue, net interest income, NIM, expenses, credit costs, earnings, capital, or other financial metrics was not provided.
- Previous-period outlook was not provided.
- Operating cash flow was not reported.
- Free cash flow was not reported.
- Gross margin was not reported.
- Reportable operating segment revenue was not provided.
- A reported total revenue line was not provided.
AlphAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.