PacWest, Western Alliance stocks plunge as US regional banking woes worsen

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Shares of PacWest Bancorp and Western Alliance Bancorp shares plunged on Thursday, dragging other regional lenders down, as news that both banks were in talks about strategic options sparked investor worries of a worsening financial crisis.

First Horizon shares plunged 36% after the news, while U.S.-listed shares of Toronto-Dominion Bank gained nearly 2%.

U.S. Federal Reserve Chair Jerome Powell on Wednesday reiterated the banking system remains resilient despite "strains" in March, after the central bank delivered a 25-basis- point rate hike and signaled a pause in its tightening cycle. Powell also said bank deposits had stabilized. "The Fed of course would react if a chaotic outflow of deposits from regional banks resumes," Citigroup analysts wrote in a note to investors. "That risk is more elevated after recent banking developments and can never be fully taken off the table."Chibuike OguhChibuike reports on mostly large U.S.-based private equity firms, including Blackstone, KKR, Carlyle, and Apollo.

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Bank stocks continue to fall following First Republic demiseRegulators have barely written the epitaph for First Republic Bank, but investors on Wall Street have already moved onto speculating which bank might be the next to fail. Bank stocks fell sharply Tuesday, led downward by smaller banks with heavy exposure to uninsured deposits and commercial banks like Western Alliance Bank, PacWest Bancorp, Comerica and Zions Bank. Shares of Western Alliance were down 17% in afternoon trading and PacWest dropped 25%, with trading of both stocks halted briefly due to high volatility. The ongoing concern among investors and regulators is that banks such as PacWest have large amounts of uninsured deposits _ those above $250,000.
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