Posted: 10:05 AM- Bloomberg News reports today that stock prices for Zions Bancorp., the Salt Lake City-based lender with operations in 10 western states, fell the most in almost six years after it said weakness in residential construction and land values in the Southwest will harm its loan portfolio into 2009.

The lender, which made the remarks in a presentation attached to a regulatory filing today, said that only charge-offs in California were "likely to decline."

Rising foreclosures, higher mortgage rates and declining property values are threatening to keep home sales depressed in the coming months and discouraging builders from starting new projects. Builders broke ground in May on the fewest houses in 17 years, the Commerce Department said today in Washington.

Zions' shares fell 7 percent, or $2.59, to $34.57 in morning trading on the Nasdaq Stock Market. Zions stock had declined 20 percent this year through Monday.

Zions's first-quarter profit was $104.3 million, or 98 cents, a 30 percent decline from earnings of $149.7 million a year earlier. The lender's provision for loan losses climbed 32 percent to $92.3 million, and Zion said uncollectible debt rose to $50.8 million from $26.7 million.