Banking: Western Alliance Bancorp deposit growth sparks rally in bank stocks

Western Alliance Bancorp stock jumped 10.4% in premarket action, while other bank stocks that have been under pressure since Silicon Valley Bank collapsed on March 10 also regained their footing.

PacWest Bancorp
PACW,
-14.58%
is up 8.3% in premarket trades, while Zions Bancorp
ZION,
-2.38%
is up by 4.2%; First Horizon Corp.
FHN,
+1.89%
is up 3.9%; and PNC Financial Services Group Inc.
PNC,
-1.83%
is up by 3.8%. Comerica Inc.
CMA,
-1.14%
is up by 2.6%.

Western Alliance Bancorp is also nearing the completion of about 50% in sales of the $6 billion of loans reclassified to held-for-sale in the first quarter, as part of its balance sheet repositioning.

Jefferies analyst Casey Haire reiterated a buy rating on Western Alliance and said the bank’s update reaffirms deposit stability.

“The update is another data point that demonstrates WAL is distancing itself from recent industry turmoil and should be well received by the market,” Haire said.

Prior to Wednesday’s gains, Western Alliance Bancorp stock was down 47% in 2023, amid turmoil among regional-bank stocks following the collapse of Silicon Valley Bank, First Republic Bank and Signature Bank since March.

Megabank stocks also rose on Wednesday as underwriters of a whopping $31 billion debt offering from pharmaceutical giant Pfizer Inc.
PFE,
-0.40%.

Bank of America Corp.’s
BAC,
-1.05%
BofA Securities unit, Citigroup Inc. 
C,
-1.67%,
 Goldman Sachs Group Inc. 
GS,
-0.39%
 and J.P. Morgan Chase & Co. 
JPM,
-0.67%
 are joint lead managers and joint book-running managers for the Pfizer offering, which consisted of eight tranches priced between 4.45% and 5.34%.

Bank of America stock is up 0.6%; Citigroup is up 0.7%; Goldman Sachs is up 0.5%; and JPMorgan Chase is up by 0.7%

In another boost to megabanks. UBS Group AG
UBS,
-1.44%
said it would book a gain of $35 billion for its purchase of Credit Suisse
CS,
-1.93%.