SEC OKs Zions method for valuing options |
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Published
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Tue, 30 Jan 2007 17:41
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SALT LAKE CITY (AFX) - Zions Bancorp said Tuesday the Securities and Exchange Commission approved the regional bank's new method for determining the value of an employee's stock option.When a company issues an employee a stock option, or a right to buy stock at a certain price, the company needs to figure out what it is worth and record it as a compensation expense. Most companies use a model reflecting what the option would be worth if it were publicly traded.The problem, Zions said, is there are key differences in mechanics and timing between employee stock options and publicly traded options. Zions' new method, known as Employee Stock Option Appreciation Rights Securities, tries to show what an employee's stock option would be worth trading on a public market.The SEC approved the system provided Zions makes certain modifications, Zions said. Zions said a patent on the securities is pending.Shares of Zions rose 45 cents to $84.50 in midday trading on the Nasdaq.Copyright 2006 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
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