With Asset Sensitivity Waning, Zions Bancorp Needs To Reassure The Street On Core Growth

In a difficult market for banks, the performance of Zions Bancorporation (NASDAQ:ZION) has been mixed. The shares had enjoyed a solid period of outperformance since my last update on the shares in July of 2021, outperforming regional banks by more than 30% at some points, but enthusiasm has waned as the interest rate theme plays out and Zions doesn’t look as differentiated on its growth prospects for the next phase of the cycle.

I still like Zions, but I do think the bank has work to do to convince the Street that past efforts to accelerate growth, including aggressive participation in the PPP and customer-facing IT investments, will pay off. My core growth expectations still aren’t all that aggressive though, and if Zions can unlock some sentiment drivers (better core deposit retention, better operating leverage, and so on), I could see the shares outperforming again.

 

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With Asset Sensitivity Waning, Zions Bancorp Needs To Reassure The Street On Core Growth