{"id":3845,"date":"2023-05-04T16:03:46","date_gmt":"2023-05-04T21:03:46","guid":{"rendered":"https:\/\/embarrdowns.com\/pacwest-bancorp-explores-strategic-options-including-sale-after-49-share-price-drop\/"},"modified":"2023-05-04T16:03:46","modified_gmt":"2023-05-04T21:03:46","slug":"pacwest-bancorp-explores-strategic-options-including-sale-after-49-share-price-drop","status":"publish","type":"post","link":"https:\/\/embarrdowns.com\/pacwest-bancorp-explores-strategic-options-including-sale-after-49-share-price-drop\/","title":{"rendered":"PacWest Bancorp explores strategic options, including sale, after 49% share price drop"},"content":{"rendered":"

PacWest Bancorp, a Los Angeles-area lender, has suffered a 49% share price drop and halted trading on the back of exploring strategic options, including a sale.[0]<\/a><\/sup> The move comes just days after regulators seized First Republic Bank and JPMorgan agreed to buy its deposits and most of its assets.[0]<\/a><\/sup> PacWest is the latest US regional bank to seek a lifeline after First Republic Bank was sold to JP Morgan after talks over the weekend.[1]<\/a><\/sup> The sale of First Republic Bank and other news has not caused any unusual deposit flows for the bank.[2]<\/a><\/sup> Core customer deposits have increased since March 31, 2023, with total deposits totaling $28bn as of May 2, 2023, with insured deposits totaling 75% vs. 71% at quarter end and 73% as of April 24, 2023.[3]<\/a><\/sup> In addition, the company recently paid down $1bn of borrowings with our excess liquidity.[3]<\/a><\/sup> Our cash reserves and liquid assets remain robust and surpass our uninsured deposits by 188%.[4]<\/a><\/sup><\/p>\n

The Federal Reserve recently raised rates for the 10th consecutive time, with Fed chief Jerome Powell hinting at a pause, but not ruling out further tightening.[5]<\/a><\/sup> Powell has pushed back at market calls for Fed rate cuts later this year, stating that low interest rates should be rare.[6]<\/a><\/sup> The US regional banking system is also at risk, according to Bill Ackman, CEO of the New York hedge fund Pershing Square.[7]<\/a><\/sup><\/p>\n

Toronto-Dominion Bank (TD) and Tennessee-based First Horizon (FHN) have called off their $13.4bn merger, citing regulatory concerns.[8]<\/a><\/sup> The deal faced a shifting bank environment.[6]<\/a><\/sup> FHN stock tanked 33% while TD stock rose modestly.[9]<\/a><\/sup> Other regional bank shares have also suffered, with shares in the Dallas-headquartered Comerica and Zions Bancorporation falling by about 10% in after-hours trading and were down again in pre-market trading on Thursday.[7]<\/a><\/sup> Regional banks have a more significant influence on the American economy compared to the UK, as they are responsible for almost 50% of business and consumer loans.[7]<\/a><\/sup> Many regional banks have had their balance sheets negatively impacted by the higher rates.[10]<\/a><\/sup> At a time when loan demand was low, they invested the incoming funds in long-term government securities and loans that today are producing low returns.[4]<\/a><\/sup><\/p>\n

0. <\/span>“U.S. stocks are falling as bank worries cloud over Fed optimism By Investing.com” Investing.com, 4 May. 2023, https:\/\/www.investing.com\/news\/stock-market-news\/us-stocks-are-falling-as-bank-worries-cloud-over-fed-optimism-3073002<\/a><\/a><\/p>\n

1. <\/span>“PacWest, Western Alliance stocks continue to fall on banking uncertainties” Yahoo Finance, 4 May. 2023, https:\/\/finance.yahoo.com\/video\/pacwest-western-alliance-stocks-continue-191857465.html<\/a><\/a><\/p>\n

2. <\/span>“‘Something’s about to break’: Why Wall Street is still freaking out about banks” CNN, 4 May. 2023, https:\/\/www.cnn.com\/2023\/05\/04\/business\/nightcap-banking-crisis-wall-street-analysis\/index.html<\/a><\/a><\/p>\n

3. <\/span>“Pacific Western Bank Issues Update | Pacific Western Bank” PacWest Bancorp, 4 May. 2023, https:\/\/www.pacwestbancorp.com\/news-market-data\/news\/news-details\/2023\/Pacific-Western-Bank-Issues-Update\/default.aspx<\/a><\/a><\/p>\n

4. <\/span>“PacWest shares sink as bank explores asset sales” The Washington Post, 4 May. 2023, https:\/\/www.washingtonpost.com\/business\/2023\/05\/04\/pacwest-bank-stock-drop\/<\/a><\/a><\/p>\n

5. <\/span>“PacWest Tries to Calm Jittery Markets After 60% Stock Plunge” Yahoo Finance, 4 May. 2023, https:\/\/finance.yahoo.com\/news\/pacwest-moves-calm-market-60-053127958.html<\/a><\/a><\/p>\n

6. <\/span>“Dow Jones Futures Fall As PacWest Dives On Sale Report; Apple Earnings On Tap | Investor’s Business Daily” Investor’s Business Daily, 4 May. 2023, https:\/\/www.investors.com\/market-trend\/stock-market-today\/dow-jones-futures-pacwest-update-pacw-dives-on-sale-report-apple-earnings<\/a><\/a><\/p>\n

7. <\/span>“Trading halted in shares of two more US lenders as fears of banking crisis mount” The Guardian, 4 May. 2023, https:\/\/www.theguardian.com\/business\/2023\/may\/04\/shares-in-california-lender-pacwest-plummet-amid-fears-of-new-us-banking-crisis<\/a><\/a><\/p>\n

8. <\/span>“Bitcoin drops with stocks as analyst warns of banking crisis \u2018endgame\u2019” Cointelegraph, 4 May. 2023, https:\/\/cointelegraph.com\/news\/bitcoin-drops-with-stocks-as-analyst-warns-of-banking-crisis-endgame<\/a><\/a><\/p>\n

9. <\/span>“PacWest Bancorp Explores Options. Investors Hit Panic Button.” Investor’s Business Daily, 4 May. 2023, https:\/\/www.investors.com\/news\/pacwest-bancorp-explores-options-including-potential-sale-investors-hit-panic-button\/<\/a><\/a><\/p>\n

10. <\/span>“Bank woes mount as investors bail from regional lenders” CBS News, 4 May. 2023, https:\/\/www.cbsnews.com\/news\/bank-stocks-today-pacwest-western-alliance-first-republic-silicon-valley-bank\/<\/a><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

PacWest Bancorp, a Los Angeles-area lender, has suffered a 49% share price drop and halted trading on the back of exploring strategic options, including a sale.[0]<\/a><\/sup> The move comes just days after regulators seized First Republic Bank and JPMorgan agreed to buy its deposits and most of its assets.[0]<\/a><\/sup> PacWest is the latest US regional bank to seek a lifeline after First Republic Bank was sold to JP Morgan after talks over the weekend.[1]<\/a><\/sup> The sale of First Republic Bank and other news has not caused any unusual deposit flows for the bank.[2]<\/a><\/sup> Core customer deposits have increased since March 31, 2023, with total deposits totaling $28bn as of May 2, 2023, with insured deposits totaling 75% vs. 71% at quarter end and 73% as of April 24, 2023.[3]<\/a><\/sup> In addition, the company recently paid down $1bn of borrowings with our excess liquidity.[3]<\/a><\/sup> Our cash reserves and liquid assets remain robust and surpass our uninsured deposits by 188%.[4]<\/a><\/sup><\/p>\n

The Federal Reserve recently raised rates for the 10th consecutive time, with Fed chief Jerome Powell hinting at a pause, but not ruling out further tightening.[5]<\/a><\/sup> Powell has pushed back at market calls for Fed rate cuts later this year, stating that low interest rates should be rare.[6]<\/a><\/sup> The US regional banking system is also at risk, according to Bill Ackman, CEO of the New York hedge fund Pershing Square.[7]<\/a><\/sup><\/p>\n

Toronto-Dominion Bank (TD) and Tennessee-based First Horizon (FHN) have called off their $13.4bn merger, citing regulatory concerns.[8]<\/a><\/sup> The deal faced a shifting bank environment.[6]<\/a><\/sup> FHN stock tanked 33% while TD stock rose modestly.[9]<\/a><\/sup> Other regional bank shares have also suffered, with shares in the Dallas-headquartered Comerica and Zions Bancorporation falling by about 10% in after-hours trading and were down again in pre-market trading on Thursday.[7]<\/a><\/sup> Regional banks have a more significant influence on the American economy compared to the UK, as they are responsible for almost 50% of business and consumer loans.[7]<\/a><\/sup> Many regional banks have had their balance sheets negatively impacted by the higher rates.[10]<\/a><\/sup> At a time when loan demand was low, they invested the incoming funds in long-term government securities and loans that today are producing low returns.[4]<\/a><\/sup><\/p>\n

0. <\/span>“U.S. stocks are falling as bank worries cloud over Fed optimism By Investing.com” Investing.com, 4 May. 2023, https:\/\/www.investing.com\/news\/stock-market-news\/us-stocks-are-falling-as-bank-worries-cloud-over-fed-optimism-3073002<\/a><\/a><\/p>\n

1. <\/span>“PacWest, Western Alliance stocks continue to fall on banking uncertainties” Yahoo Finance, 4 May. 2023, https:\/\/finance.yahoo.com\/video\/pacwest-western-alliance-stocks-continue-191857465.html<\/a><\/a><\/p>\n

2. <\/span>“‘Something’s about to break’: Why Wall Street is still freaking out about banks” CNN, 4 May. 2023, https:\/\/www.cnn.com\/2023\/05\/04\/business\/nightcap-banking-crisis-wall-street-analysis\/index.html<\/a><\/a><\/p>\n

3. <\/span>“Pacific Western Bank Issues Update | Pacific Western Bank” PacWest Bancorp, 4 May. 2023, https:\/\/www.pacwestbancorp.com\/news-market-data\/news\/news-details\/2023\/Pacific-Western-Bank-Issues-Update\/default.aspx<\/a><\/a><\/p>\n

4. <\/span>“PacWest shares sink as bank explores asset sales” The Washington Post, 4 May. 2023, https:\/\/www.washingtonpost.com\/business\/2023\/05\/04\/pacwest-bank-stock-drop\/<\/a><\/a><\/p>\n

5. <\/span>“PacWest Tries to Calm Jittery Markets After 60% Stock Plunge” Yahoo Finance, 4 May. 2023, https:\/\/finance.yahoo.com\/news\/pacwest-moves-calm-market-60-053127958.html<\/a><\/a><\/p>\n

6. <\/span>“Dow Jones Futures Fall As PacWest Dives On Sale Report; Apple Earnings On Tap | Investor’s Business Daily” Investor’s Business Daily, 4 May. 2023, https:\/\/www.investors.com\/market-trend\/stock-market-today\/dow-jones-futures-pacwest-update-pacw-dives-on-sale-report-apple-earnings<\/a><\/a><\/p>\n

7. <\/span>“Trading halted in shares of two more US lenders as fears of banking crisis mount” The Guardian, 4 May. 2023, https:\/\/www.theguardian.com\/business\/2023\/may\/04\/shares-in-california-lender-pacwest-plummet-amid-fears-of-new-us-banking-crisis<\/a><\/a><\/p>\n

8. <\/span>“Bitcoin drops with stocks as analyst warns of banking crisis \u2018endgame\u2019” Cointelegraph, 4 May. 2023, https:\/\/cointelegraph.com\/news\/bitcoin-drops-with-stocks-as-analyst-warns-of-banking-crisis-endgame<\/a><\/a><\/p>\n

9. <\/span>“PacWest Bancorp Explores Options. Investors Hit Panic Button.” Investor’s Business Daily, 4 May. 2023, https:\/\/www.investors.com\/news\/pacwest-bancorp-explores-options-including-potential-sale-investors-hit-panic-button\/<\/a><\/a><\/p>\n

10. <\/span>“Bank woes mount as investors bail from regional lenders” CBS News, 4 May. 2023, https:\/\/www.cbsnews.com\/news\/bank-stocks-today-pacwest-western-alliance-first-republic-silicon-valley-bank\/<\/a><\/a><\/p>\n","protected":false},"author":3,"featured_media":3844,"comment_status":"","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[47],"tags":[],"_links":{"self":[{"href":"https:\/\/embarrdowns.com\/wp-json\/wp\/v2\/posts\/3845"}],"collection":[{"href":"https:\/\/embarrdowns.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/embarrdowns.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/embarrdowns.com\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/embarrdowns.com\/wp-json\/wp\/v2\/comments?post=3845"}],"version-history":[{"count":0,"href":"https:\/\/embarrdowns.com\/wp-json\/wp\/v2\/posts\/3845\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/embarrdowns.com\/wp-json\/wp\/v2\/media\/3844"}],"wp:attachment":[{"href":"https:\/\/embarrdowns.com\/wp-json\/wp\/v2\/media?parent=3845"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/embarrdowns.com\/wp-json\/wp\/v2\/categories?post=3845"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/embarrdowns.com\/wp-json\/wp\/v2\/tags?post=3845"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}