Shares of
PacWest
and other regional banks were advancing early on Friday after a week of precipitous drops.
PacWest (ticker: PACW) climbed 13.6% in premarket trading.
Western Alliance
(WAL) was up 9.6%.
Comerica
(CMA) rose 2.5%, and
Zions Bancorp
(ZION) rose 3.4%. The SPDR S&P Regional Banking exchange-traded fund (KRE) increased 1.2%.
The collapse of
First Republic
(FRBK) on Monday turned investors’ attention to other regional lenders that might have experienced similar problems. Stocks have been rocked by concerns that depositors are taking flight. PacWest shares dropped 50% on Thursday, despite the company saying that it hadn’t seen any unusual deposit outflows since the collapse of First Republic at the start of the week.
“There’s no doubt that this is a nervous time for markets as we wait for the next series of resolutions in the U.S. regional banking crisis,” said Deutsche Bank analyst Jim Reid. The “scary thing is that the attacks are increasingly looking speculative but risk becoming self-fulfilling.”
It was hoped that
JPMorgan Chase
‘s (JPM) purchase of First Republic’s assets on Monday would quell the market jitters, but they have only intensified since. On Wednesday, Federal Reserve Chairman Jerome Powell said the banking system is “sound and resilient.”
Write to Brian Swint at [email protected]
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