NEW YORK (Reuters) - Zions Bancorporation (ZION.O: Quote, Profile , Research) reportedan almost 9 percent rise in first-quarter net profit onThursday, which missed analysts' estimates, as net interestincome increased.

"I was a little disappointed in loan and deposit growth,which came mostly from its recent acquisition," said ThaneBublitz, an analyst with Thrivent Asset Management. "But creditquality was a positive surprise."

In January, Zions closed its acquisition of The Stockmen'sBancorp, which allowed it to expand in Arizona and California.Zions, a Salt Lake City bank, now operates banks throughout thewestern United States.

Its earnings rose to $149.7 million or $1.36 a share, from$137.6 million or $1.28 a share in the year earlier quarter.The figure came below the average forecast of $1.42 a share,according to Reuters estimates.

The bank said, however, that income taxes in the firstquarter and penalties to surrender bank-owned life insurancecontracts had reduced net earnings by 3 cents a share.

Net interest income for the first quarter increased by 8.1percent to $457.1 million from $422.8 million in the year agoquarter, the bank said. Loans and leases grew by $1.3 billionto $35.9 billion, and total deposits also increased $1.3billion to $36.3 billion.

Zions stock closed up 30 cents at $85.80 on the Nasdaq onThursday before the results announcement. In the last 12months, its shares have risen about 4 percent, or less than athird of the gain in the Standard & Poor's 500 index.

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