A screen displays the Western Alliance Bancorporation logo and trading information on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., March 14, 2023.
Brendan Mcdermid | Reuters
Shares of Western Alliance Bancorp cut losses sharply on Thursday after the regional bank issued a new update showing steady outflows amid the banking crisis.
Phoenix-based lender said in a profile that its net outflows had plummeted and returned to normal levels on March 17. Deposit balances increased by about $900 million through the end of the quarter as of March 30, the bank added.
Shares were last traded down 10% after falling as much as 20% the previous Wednesday. Investors were initially disappointed by the lack of detail in an earlier update released Tuesday night.
Western Alliance Bankcorp
Western Alliance suffered a drop in deposits as a result of the collapse of Silicon Valley Bank and Signature Bank last month. Shares of banks in the region tumbled as investors grew increasingly worried they could face similar balance sheet problems, possibly an asset mismatch. long-term and short-term debt.
Western Alliance said it experienced a total of $6 billion in net deposits in the first quarter. The bank said outflows were focused on technology and innovation groups as well as payments services groups.
Investors were now comforted in the update, which noted that the bank saw deposits increase by $1.2 billion this month. The bank also said that total insured deposits now stand at 68% of total deposits, significantly higher than at the end of the year, accounting for 50% of total deposits.
“This increase in the percentage of insured deposits following a surge in outflows in mid-March is almost entirely due to strong deposit usage and growth,” Western Alliance said in a statement. advances and mortgage deposits to customers”.
Bank shares are down more than 50% this year, down 66% from record highs.
