Regional bank stocks soar after Western Alliance says deposits are growing

Regional bank stocks surged on Wednesday after Western Alliance reported that customer deposits are growing.

Western Alliance, pictured here, reported that customer deposits are growing. Mandatory Credit: Patrick T. Fallon/AFP/Getty Images

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.