Another regional bank is reportedly considering a sale or other moves.
Bloomberg reported Wednesday that PacWest Bancorp is mulling those options. The California-headquartered bank has not seen an official process for an auction kickoff so far, according to the report.
The outlet attributed the information to unnamed sources “familiar with the matter.” Those sources reportedly indicated selling all of the bank’s businesses as one hasn’t been attractive to many entities.
The other options PacWest is looking at include raising capital or breaking its businesses up, according to Bloomberg.
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FOX Business reached out to PacWest for comment.
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In April, the bank said its total deposits had come in at $28.19 billion for the first quarter, marking a nearly 17% decrease from the fourth quarter and an approximately 15% decline from the first quarter in 2022. Deposits had risen from March 20 when they were at $27.1 billion, and CEO Paul Taylor described them as stabilizing and rebounding.
Taylor also said at the time that PacWest executives “took immediate steps to maximize liquidity, including the exploration of strategic asset sales, which has led to the transfer of our $2.7 billion lender finance loan portfolio to be held for sale.”
In the quarter, the company recorded a $1.38 billion non-cash goodwill impairment “due to decline in our stock price as a result of recent market volatility.” The charge, which affected first-quarter results, “has no impact on [PacWest’s] regulatory capital ratios, cash flows, or liquidity position,” the bank said in its earnings release.
The price of PacWest’s shares has dropped nearly 72% since the start of 2023 as of Wednesday evening. After hours, there has been a drop of almost 52%.
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The report of PacWest’s strategic option exploration comes not long after the Federal Deposit Insurance Corporation (FDIC) accepted JPMorgan Chase’s bid to buy First Republic Bank.
Two banks, Silicon Valley Bank and Signature Bank, were taken over by the FDIC in March. Another, Silvergate, folded not long prior to that. Those collapses were followed by turbulence in the market, particularly among some banking stocks, and stirred worries of additional failures.
Breck Dumas contributed to this report.
Source: https://finance.yahoo.com/news/another-bank-failure-pacwest-reportedly-011202641.html