Business Context and Reporting Period
Company: Zions Bancorporation, National Association
Filing Type: Form 10-K (Annual Report)
Period Ended: December 31, 2025
Headquarters: Salt Lake City, Utah
Operations: A regional bank operating through seven affiliate banks (Zions Bank, CB&T, Amegy, NBAZ, NSB, Vectra, TCBW) across 11 Western states. The bank serves over one million customers through 407 branches and digital channels.
Key Financial Metrics (Year Ended Dec 31, 2025)
| Metric | 2025 Value | 2024 Value | Change |
|---|---|---|---|
| Total Net Revenue | $3,385 million | $3,130 million | +8% |
| Net Interest Income | $2,627 million | $2,430 million | +8% |
| Net Interest Margin (NIM) | 3.21% | 3.00% | +21 bps |
| Noninterest Income | $758 million | $700 million | +8% |
| Provision for Credit Losses | $72 million | $72 million | Flat |
| Net Income | $899 million | $784 million | +15% |
| Diluted EPS | $6.01 | $4.95 | +21% |
| Efficiency Ratio | 62.6% | 64.2% | Improved |
| Total Assets | $88.99 billion | $88.78 billion | Flat |
| Total Loans & Leases | $60.92 billion | $59.41 billion | +3% |
| Total Deposits | $75.64 billion | $76.22 billion | -1% |
| Return on Average Assets (ROAA) | 1.00% | 0.88% | +12 bps |
| Return on Average Common Equity (ROAE) | 13.7% | 13.1% | +60 bps |
| CET1 Capital Ratio | 11.5% | 10.9% | +60 bps |
Material Changes vs. Prior Period
- Revenue Growth: Net interest income grew 8% driven by lower funding costs and a favorable shift in asset composition. Noninterest income rose 8%, with a 57% increase in noncustomer-related income due to net securities gains from SBIC investments.
- Expense Management: Noninterest expense increased 4% ($92 million), primarily due to higher salaries/benefits and a $15 million charitable contribution. Despite this, the efficiency ratio improved to 62.6%.
- Asset Quality: Net charge-offs increased to $89 million (0.15% of average loans) from $60 million in 2024. This increase was driven by a $50 million loss on two related commercial loans in Q3 2025. Nonperforming assets rose slightly to $320 million (0.52% of loans).
- Balance Sheet: Total loans grew 3% to $60.9 billion, led by commercial and industrial and consumer residential loans. Total deposits declined 1% to $75.6 billion, primarily due to a reduction in brokered deposits, partially offset by growth in noninterest-bearing demand deposits.
Guidance, Outlook, and Risks
Management Commentary:
- Management emphasizes a strategy of balanced growth in customers, pre-tax net income, and shareholder returns.
- Capital markets fees and income benefited from increased swap fee revenue and investment banking advisory fees.
- The bank maintains a "well-capitalized" status under Basel III, exceeding all regulatory minimums.
Key Risks and Contingencies:
- Credit Risk: Concentrations in Commercial Real Estate (CRE), specifically office, multifamily, and industrial properties, face elevated vacancy rates and declining valuations. The bank also has exposure to oil and gas lending and nondepository financial institutions (NDFIs).
- Interest Rate Risk: The bank is asset-sensitive. While NIM improved in 2025, future rate cuts could compress margins. The bank utilizes derivatives (swaps and futures) to manage this exposure.
- Regulatory Environment: Potential impacts from the "Basel III Endgame" proposal, which could revise capital requirements for large banks. The bank is currently under the $100 billion asset threshold but monitors the proposal closely.
- Cybersecurity: Persistent threats from sophisticated actors, including AI-enabled attacks, remain a primary operational risk.
Unusual Items:
- A $50 million charge-off in Q3 2025 related to revolving lines of credit for two related commercial borrowers involved in mortgage origination fraud.
- A $15 million charitable contribution in 2025 to fund future donations that would otherwise be nondeductible under new tax laws.
Investor Verification Checklist
- Credit Quality Trends: Verify the trajectory of the $50 million NDFI charge-off and monitor the allowance for credit losses (ACL) coverage ratio, which decreased to 1.19%.
- Deposit Stability: Assess the sustainability of the shift from brokered deposits to noninterest-bearing demand deposits and the impact on funding costs.
- CRE Exposure: Review the specific performance of the office and multifamily CRE portfolios, which represent significant concentrations (approx. 13% and 30% of CRE respectively).
- Regulatory Capital: Monitor the finalization of the Basel III Endgame rules and their potential impact on capital requirements and share repurchase capacity.
- Non-GAAP Measures: Reconcile the reported efficiency ratio (62.6%) with the adjusted ratio excluding the charitable contribution (62.2%) to understand core operational leverage.