Zions Bancorporation profits dive

Zions Bancorporation, the Salt Lake City-based holding company for Nevada State Bank, on Thursday reported third-quarter profits shrank by 75 percent as it battened down the hatches for the continuing credit storm.

Net income fell to $33.4 million for the third quarter from $132 million in the same period last year.

Earnings per share dropped to 31 cents from $1.22 in the same quarter last year.

The holding company intends to seek and receive Treasury Department approval for federal investment in $500 million to $1.5 billion in senior preferred shares at Zions, said Harris Simmons, chairman and chief executive.

The sale of senior preferred shares will enable Zions to make more loans, he said.

"We do view the (Treasury) program as the cheapest source of capital," Simmons said.

Its Nevada State Bank and National Bank of Arizona acquired $737 million in deposits from failed Silver State Bank of Henderson in September. Simmons expects to acquire other low-risk assets from banks that regulators close.

"We believe we're well-positioned to weather the crisis," Simmons said.

Nonperforming assets, including loans, increased to $924.4 million, up from $196.6 million a year ago. The holding company has $54 billion in assets and operates banks in 10 western states. Arizona is the "most problematic" market, Simmons said.

Shares of Zions jumped $2.61, or 6.94 percent, to close at $40.20 on the Nasdaq Global Select Market.