This post was originally published on this site
Shares of Western Alliance Bancorp. dropped more than 5% in the extended session Tuesday after the Phoenix-based bank narrowly missed profit expectations but assured investors it has taken steps to bolster its liquidity after it weathered the crisis unleashed by the collapse of Silicon Valley Bank.
Western Alliance
WAL,
said it earned $215.7 million, or $1.96 a share, in the second quarter, compared with $260.2 million, or $2.39 a share, in the year-ago quarter. Analysts polled by FactSet expected the bank to report EPS of $1.97.
“Western Alliance continued to successfully execute its balance-sheet repositioning strategy and return to normal business operations by bolstering liquidity and capital, sustaining profitability and expanding core client relationships,” Chief Executive Kenneth A. Vecchione said in a statement.
Don’t miss: Banks are doing better than feared as stocks rally and Bank of America builds cash
Revenue rose 21% to $669.3 million, the bank said.
Quarterly deposit growth of $3.5 billion lowered the bank’s loan-to-deposit ratio to 94%, with total insured and collateralized deposits representing 81% of deposits and available liquidity coverage of 276% of uninsured deposits, Vecchione said.
Shares of Western Alliance ended the regular trading day up more than 8%. So far this year, the stock is down 28%, which contrasts with gains of around 19% for the S&P 500 index
SPX,
Banks were in the eye of the storm in March as U.S. banking regulators shut down Silicon Valley Bank after the bank’s parent SVB Financial Group tried to raise capital and triggered a run.
It was the second-largest bank failure in U.S. history after the collapse of Washington Mutual in 2008, and the collapse of other banks, such as crypto-friendly Signature Bank, followed.
Several major U.S. banks have reported their second-quarter results, surprising Wall Street with earnings beats. Bank of America earlier on Tuesday said its revenue rose 11% as the megabank relied on more checking and other accounts.
