Regional bank stocks soar after Western Alliance says deposits are growing

Story by CNN/Stylemagazine.com Newswire

5/17/2023

Originally Published: 17 MAY 23 12:35 ET

By Krystal Hur, CNN

New York (CNN) — Regional bank stocks surged on Wednesday after Western Alliance reported that customer deposits are growing.

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PacWest shares fall heavily after fall in deposits

Matt Egan talks about the struggle of regional banks as customers take their deposits elsewhere. Source: CNN

Western Alliance said in a regulatory filing Tuesday that its deposit balances stabilized by late March, and that its deposit growth exceeded $2 billion between March 31 and May 12 to around $50 billion. That’s up from $46.7 billion as of the end of last quarter.

Western Alliance shares rose roughly 13%, recouping its losses and then some from the last two weeks.

Shares of other beaten-down regional lenders rallied on the news. The SPDR S&P Regional Banking exchange-traded fund rose about 6%. PacWest shares rose about 18%, KeyCorp added 7% and Comerica marched up 11%.

Western Alliance’s latest deposit update comes after it earlier this month strongly denied a report that it’s exploring strategic options, including a potential sale. The report, along with PacWest’s confirmation that it’s exploring options, helped accelerate a steep sell-off in regional bank stocks that started when Silicon Valley Bank and Signature Bank collapsed in March.

Shares of Western Alliance are down about 40% for the year.