In a large bowl, cream the butter, sugar and lemon balm. Add eggs, one at a time, beating well after each addition. Combine the flour, baking powder and salt; add to creamed mixture alternately with milk. Stir in walnuts if desired and lemon zest. Pour into a greased 8x4-in. loaf pan. Bake at 350° for 50-60 minutes or until a toothpick comes out clean.
In a small bowl, whisk the sugar, water and lemon juice; stir in lemon balm. Spoon over warm bread while still in the pan. Cool for 10 minutes before removing from pan to a wire rack to cool completely.