ZIONS BANCORPORATION, NATIONAL ASSOCIATION /UT/ has recently released its 10-Q report. Zions Bancorporation, National Association provides banking and related financial services across a western U.S. footprint that includes Arizona, California, Colorado, Idaho, Nevada, New Mexico, Oregon, Texas, Utah, Washington and Wyoming. Its operations are organized through Zions Bank, California Bank & Trust, Amegy Bank, National Bank of Arizona, Nevada State Bank, Vectra Bank Colorado and The Commerce Bank of Washington, with offerings spanning commercial and small business banking, commercial real estate lending, retail banking, capital markets and wealth management.
In Item 2, management said second-quarter 2026 diluted EPS rose to $3.05 from $1.63 a year earlier, helped by $252 million of pre-tax net gains. Those gains included a $215 million gain on the sale of Visa Class B-1 shares and $37 million of net unrealized gains from SBIC investments, which added about $1.31 per diluted share after tax. Net earnings applicable to common shareholders and adjusted pre-provision net revenue both improved year over year, while the efficiency ratio held at 62.2%, flat with the prior-year quarter and better than 65.0% in the first quarter.
Net interest income increased $29 million, or 4%, to $677 million, as lower funding costs offset declines in asset yields. The net interest margin widened to 3.27% from 3.17% a year earlier, with average interest-bearing liabilities down $2.1 billion, or 4%, to $55.2 billion and average interest-earning assets up $788 million, or 1%, to $84.4 billion.
Average loans and leases rose $1.4 billion, or 2%, to $61.9 billion, driven mainly by commercial loan growth. Average investment securities fell $708 million, or 4%, to $17.7 billion, reflecting principal reductions net of reinvestments, and management said the runoff of lower-yielding securities helped the earning-asset mix.
Provision for credit losses was $3 million versus a negative $1 million in the prior-year quarter. Net loan and lease charge-offs were $9 million, or 0.06% of average loans and leases annualized, compared with $10 million, or 0.07%, a year earlier. Nonperforming assets were $298 million, or 0.48% of total loans and leases plus other real estate owned, down from $313 million, or 0.51%; classified loans were $2.3 billion, or 3.72% of total loans and leases, versus $2.7 billion, or 4.43%.
Total deposits increased $2.8 billion, or 4%, to $72.7 billion excluding brokered deposits, with interest-bearing deposits up $2.0 billion. Average deposits rose $2.0 billion, or 3%, to $76.2 billion, and average noninterest-bearing deposits increased $1.4 billion, or 6%, making up 34% of total deposits versus 33% a year earlier. Total borrowed funds fell $3.6 billion, or 53%, to reflect a $4.6 billion drop in short-term borrowings, partly offset by higher federal funds purchased, security repurchase agreements and $1.0 billion of senior notes issued over the past year.
Noninterest income was lifted by $252 million of pre-tax net gains, while customer-related noninterest income rose $18 million, or 11%, on higher capital markets fees and income, loan-related fees and income, and commercial account fees. Noninterest expense increased $24 million, or 5%, led by higher professional and legal services, salary and employee benefit costs tied to incentive compensation, and higher technology, telecom and information processing expenses.
On July 31, 2026, the company completed its acquisition of Basis Multifamily Finance I, LLC, adding an agency lending platform and mortgage servicing rights. Zions said the deal expands its product suite through the Fannie Mae DUS and Freddie Mac Optigo conventional and small balance loan programs and adds to its commercial real estate and capital markets businesses. As a result of these announcements, the company's shares have moved -1.2% on the market, and are now trading at a price of $70.839. For more information, read the company's full 10-Q submission here.
