Zions Bancorporation, whose principal subsidiary is Zions First National Bank that has 73 Utah branches, had a $17.8 million net loss or $3.04 per share in 1988, according to Roy W. Simmons, chairman and chief executive officer.

He said the corporation had a $14.1 million net loss or $2.09 per share in 1987. The loss for 1988 included a net loss of $12.2 million or $2.09 per share for the fourth quarter of the year compared to a net loss of $6.7 million or $1.18 per share in the same quarter a year ago.Simmons is optimistic the economy in the Intermountain Area will improve this year, allowing the corporation to strengthen its reserves and liquidity so it can show a profit.

He said earnings for 1987 have been restated to reflect the effect of the implementation of new accounting standards relating to accounting for direct costs and fees associated with the origination of loans and leases.

The accounting results for 1987 included $19.7 million in income tax benefits that were not available to the company in 1988, he said.

Reflecting industry trends, the company increased its allowance for loan losses in the fourth quarter of 1988 to $54.5 million compared to $39.3 million in the same period a year ago.

Allowance for loan losses now equals 90.4 percent of nonaccrual loans and leases of $60.3 million and 3.32 percent of total net loans and leases on Dec. 31, 1988, compared to 69.1 percent of nonaccrual loans and leases of $56.9 million and 2.25 percent of total net loans and leases on Dec. 31, 1987.

Simmons said the company, through a subsidiary, Zions Mortgage Co., sold a portion of its mortgage servicing portfolio, which resulted in a gain of $3.8 million in the fourth quarter of 1988.

He said the mortgage servicing aspect of the company's business remains an active part of the operations and continued to be a significant "off balance sheet" asset of the company. Zions Mortgage Co.'s. total mortgage servicing portfolio equaled $876 million on Dec. 31, 1988.

Simmons said the company's liquidity remains at an exceptionally high level as core deposits constituted 91.6 percent of total deposits and the company's investment in liquid securities increased by $175.3 million last year. The company's basic earning power remains strong as net interest income increased 11.6 percent to $109 million in 1988 from $97.7 million in 1987.