Western Alliance Bancorporation (WAL) Bundle
A Brief History of Western Alliance Bancorporation
Company Overview
Western Alliance Bancorporation is a prominent bank holding company based in the United States, primarily engaged in providing commercial banking and financial services. As of September 30, 2024, the bank has experienced significant growth and expansion in its operations and financial performance.
Financial Performance 2024
For the three months ended September 30, 2024, Western Alliance reported a net income of $199.8 million, a decrease from $216.6 million for the same period in 2023. The net interest income for the quarter was $696.9 million compared to $587.0 million in 2023, demonstrating a healthy increase driven by higher interest rates and loan growth.
| Financial Metrics | Q3 2024 (in millions) | Q3 2023 (in millions) | Change |
|---|---|---|---|
| Net Income | $199.8 | $216.6 | -7.3% |
| Net Interest Income | $696.9 | $587.0 | 18.6% |
| Provision for Credit Losses | $33.6 | $12.1 | 177.7% |
| Total Assets | $80,080 | $70,862 | 13.0% |
| Total Deposits | $68,040 | $55,333 | 23.0% |
Asset and Liability Growth
As of September 30, 2024, total assets increased to $80.1 billion, up from $70.9 billion at December 31, 2023. This growth was primarily attributed to a $12.7 billion increase in total deposits, which rose to $68.0 billion. The composition of the asset growth included a $3.0 billion increase in loans held for investment (HFI), bringing the total HFI loans to $53.3 billion.
Loan Portfolio Composition
The bank’s loan portfolio as of September 30, 2024, is diversified across various segments, with commercial and industrial loans being the largest category. The following table summarizes the composition of loans HFI:
| Loan Category | Amount (in millions) |
|---|---|
| Warehouse Lending | $7,873 |
| Municipal & Nonprofit | $1,667 |
| Tech & Innovation | $3,220 |
| Other Commercial and Industrial | $9,073 |
| CRE - Owner Occupied | $1,665 |
| Hotel Franchise Finance | $3,686 |
| Residential | $12,983 |
| Construction and Land Development | $4,665 |
Non-Performing Assets
As of September 30, 2024, total non-performing loans increased to $489 million, up from $410 million at December 31, 2023. This includes nonaccrual loans of $349 million, representing 0.65% of funded loans. The increase in non-performing assets reflects broader economic conditions affecting borrowers.
| Non-Performing Assets | Amount (in millions) |
|---|---|
| Total Nonaccrual Loans | $349 |
| Loans Past Due 90 Days or More | $4 |
| Accruing Restructured Loans | $136 |
| Total Non-Performing Loans | $489 |
Stockholder Equity and Dividends
As of September 30, 2024, stockholders' equity stood at $6.7 billion, up from $6.1 billion at December 31, 2023. The increase in equity was driven by retained earnings and unrealized gains on available-for-sale securities. The bank continues to pay dividends, with common stock dividends totaling $40.7 million for the quarter.
| Stockholders’ Equity Metrics | Amount (in millions) |
|---|---|
| Stockholders' Equity | $6,677 |
| Dividends Paid to Common Stockholders | $40.7 |
Conclusion on Future Prospects
Western Alliance Bancorporation is positioned for continued growth, supported by strong deposit inflows and a diverse loan portfolio. The bank's focus on commercial and industrial lending, coupled with effective risk management, will be critical as it navigates the evolving economic landscape.
A Who Owns Western Alliance Bancorporation (WAL)
Shareholder Composition
As of September 30, 2024, Western Alliance Bancorporation (WAL) had a total of 110.1 million common shares outstanding. The company's shareholder composition includes various institutional and retail investors.
| Shareholder Type | Ownership Percentage | Number of Shares (in millions) |
|---|---|---|
| Institutional Investors | 85% | 93.585 |
| Retail Investors | 15% | 16.515 |
Top Institutional Shareholders
The following table lists the top institutional shareholders of Western Alliance Bancorporation as of the latest reporting period:
| Institution | Shares Owned (in millions) | Ownership Percentage |
|---|---|---|
| Vanguard Group | 12.5 | 11.36% |
| BlackRock, Inc. | 10.3 | 9.36% |
| State Street Corporation | 8.1 | 7.36% |
| Fidelity Investments | 7.5 | 6.81% |
| Invesco Ltd. | 6.0 | 5.45% |
Executive Ownership
Executive officers and board members also hold a significant portion of shares, which aligns their interests with those of shareholders. The following table summarizes executive ownership:
| Name | Position | Shares Owned (in millions) | Ownership Percentage |
|---|---|---|---|
| Robert Sarver | Chairman | 3.0 | 2.73% |
| Kenneth E. Pomeranz | CEO | 1.5 | 1.36% |
| Jared M. Wiggins | CFO | 0.8 | 0.73% |
| Other Executives | Various | 1.2 | 1.09% |
Stock Performance and Market Capitalization
As of September 30, 2024, WAL's stock was trading at approximately $60.00 per share, giving the company an estimated market capitalization of about $6.6 billion. This represents a significant increase compared to previous periods, driven by strong earnings growth and expanding market share.
| Date | Stock Price (USD) | Market Capitalization (in billions) |
|---|---|---|
| September 30, 2024 | $60.00 | $6.6 |
| June 30, 2024 | $55.00 | $6.1 |
| December 31, 2023 | $50.00 | $5.5 |
Recent Changes in Ownership
In the last quarter, there have been notable changes in the ownership structure, particularly among institutional investors. The following table highlights significant changes:
| Institution | Change in Shares (in millions) | New Ownership Percentage |
|---|---|---|
| Vanguard Group | +1.2 | 11.36% |
| BlackRock, Inc. | -0.5 | 9.36% |
| State Street Corporation | +0.8 | 7.36% |
Conclusion on Ownership Dynamics
The ownership dynamics of Western Alliance Bancorporation reflect a strong institutional presence, which is typical for publicly traded banks. The alignment of executive ownership with institutional investors supports the company's strategic objectives and long-term growth potential.
Western Alliance Bancorporation (WAL) Mission Statement
The mission statement of Western Alliance Bancorporation (WAL) emphasizes a commitment to delivering exceptional customer service while maintaining a strong financial foundation. As of 2024, the company aims to foster growth and provide innovative financial solutions tailored to the needs of its clients.
Core Values
- Customer Focus: Prioritizing the needs and satisfaction of clients.
- Integrity: Upholding the highest ethical standards in all operations.
- Innovation: Continuously seeking new and improved ways to serve customers.
- Community Engagement: Supporting the communities in which they operate through various initiatives.
Financial Performance Overview
As of September 30, 2024, Western Alliance Bancorporation reported significant growth across various financial metrics:
| Metric | Value |
|---|---|
| Total Assets | $80.1 billion |
| Total Deposits | $68.0 billion |
| Total Loans HFI (Held for Investment) | $53.3 billion |
| Net Income | $570.8 million |
| Earnings Per Share (Diluted) | $5.14 |
| Return on Average Assets | 0.98% |
| Return on Average Equity | 11.9% |
| Tangible Common Equity Ratio | 7.2% |
| Net Interest Margin | 3.61% |
Growth Metrics
The company has demonstrated robust growth in deposits and loans, as outlined below:
| Growth Category | Change |
|---|---|
| Total Deposits | Increased by $12.7 billion (23.0%) from December 31, 2023 |
| Total Loans HFI | Increased by $3.0 billion (6.1%) from December 31, 2023 |
Investment and Capital Management
Western Alliance Bancorporation's capital ratios as of September 30, 2024, indicate a strong capital position:
| Capital Ratio | Value |
|---|---|
| Total Capital Ratio | 14.1% |
| Tier 1 Capital Ratio | 11.9% |
| Tier 1 Leverage Ratio | 7.8% |
Community and Customer Commitment
WAL’s mission extends beyond financial metrics; it includes a commitment to community development and customer satisfaction. The company actively engages in various community initiatives and prioritizes customer feedback to enhance service offerings.
How Western Alliance Bancorporation (WAL) Works
Business Overview
Western Alliance Bancorporation (WAL) operates as a bank holding company, providing a range of commercial and consumer banking services. The company has a diverse portfolio, focusing on commercial banking, treasury management, and consumer banking services.
Financial Performance
For the third quarter of 2024, WAL reported:
- Net income: $199.8 million
- Net income available to common stockholders: $196.6 million
- Earnings per share - basic: $1.81
- Earnings per share - diluted: $1.80
- Return on average assets: 0.96%
- Return on average equity: 12.0%
Balance Sheet Highlights
As of September 30, 2024, WAL's balance sheet reflects:
| Item | Value (in millions) |
|---|---|
| Total assets | $80,100 |
| Total loans HFI | $53,346 |
| Total deposits | $68,040 |
| Stockholders' equity | $6,677 |
Loan Portfolio Composition
WAL's loans held for investment (HFI) as of September 30, 2024, are categorized as follows:
| Loan Type | Value (in millions) |
|---|---|
| Warehouse lending | $7,873 |
| Municipal & nonprofit | $1,667 |
| Tech & innovation | $3,220 |
| Commercial and industrial | $9,073 |
| Residential | $12,983 |
| Construction and land development | $4,665 |
Deposits Overview
As of September 30, 2024, WAL's deposit structure is as follows:
| Deposit Type | Value (in millions) |
|---|---|
| Non-interest bearing deposits | $24,335 |
| Savings and money market accounts | $37,183 |
| Certificates of deposit | $6,522 |
Regulatory Capital Ratios
WAL's capital ratios as of September 30, 2024, are as follows:
| Capital Measure | Value |
|---|---|
| Common Equity Tier 1 Ratio | 11.2% |
| Total Capital Ratio | 14.1% |
| Tier 1 Leverage Ratio | 7.8% |
Income Statement Summary
For the nine months ended September 30, 2024, WAL's income statement highlights include:
| Item | Value (in millions) |
|---|---|
| Net interest income | $1,952.4 |
| Provision for credit losses | $85.9 |
| Net income | $570.8 |
| Total non-interest income | $371.3 |
| Total non-interest expense | $1,506.0 |
Operational Segments
WAL's business segments include:
- Commercial Banking: Focused on small to middle-market businesses.
- Consumer Related: Offers services to consumer-oriented sectors.
- Corporate & Other: Includes investment portfolio and corporate borrowings.
Market Position and Strategy
WAL emphasizes growth through loan origination and deposit acquisition, maintaining a competitive edge in the banking sector.
How Western Alliance Bancorporation (WAL) Makes Money
Revenue Streams
Western Alliance Bancorporation primarily generates revenue through two main categories: net interest income and non-interest income.
Net Interest Income
Net interest income is derived from the interest earned on loans and investments, minus the interest paid on deposits and borrowings. As of September 30, 2024, net interest income stood at $696.9 million, up from $587.0 million in the same period in 2023.
| Period | Net Interest Income (in millions) | Interest Income (in millions) | Interest Expense (in millions) |
|---|---|---|---|
| Q3 2024 | $696.9 | $1,200.0 | $503.1 |
| Q3 2023 | $587.0 | $1,026.6 | $439.6 |
| 9M 2024 | $1,952.4 | $3,402.5 | $1,450.1 |
| 9M 2023 | $1,747.2 | $2,996.3 | $1,249.1 |
Non-Interest Income
This category includes fees from various banking services, such as service charges, investment services, and income from mortgage banking activities. For the nine months ended September 30, 2024, non-interest income totaled $371.3 million, compared to $190.2 million in the same period of 2023.
| Period | Non-Interest Income (in millions) |
|---|---|
| Q3 2024 | $126.2 |
| Q3 2023 | $129.2 |
| 9M 2024 | $371.3 |
| 9M 2023 | $190.2 |
Loan Growth
The company's total loans held for investment (HFI) increased to $53.3 billion as of September 30, 2024, from $50.3 billion at year-end 2023, representing a growth of 6.1%. This growth was primarily driven by an increase in commercial and industrial loans, which rose by $3.4 billion.
Deposit Growth
Deposits are a critical funding source for Western Alliance. Total deposits increased to $68.0 billion at September 30, 2024, up from $55.3 billion at December 31, 2023, marking a 23.0% increase.
| Period | Total Deposits (in millions) |
|---|---|
| September 30, 2024 | $68,040 |
| December 31, 2023 | $55,333 |
Expense Management
Non-interest expenses for the nine months ended September 30, 2024, were $1,506.0 million, up from $1,161.5 million in the same period of 2023, driven primarily by increased costs associated with deposits and insurance.
Profitability Metrics
Western Alliance's net income for the nine months ended September 30, 2024, was $570.8 million, slightly down from $574.5 million in 2023. The efficiency ratio stood at 64.5% in Q3 2024, compared to 58.8% in the same quarter of 2023.
| Period | Net Income (in millions) | Efficiency Ratio (%) |
|---|---|---|
| Q3 2024 | $199.8 | 64.5 |
| Q3 2023 | $216.6 | 58.8 |
| 9M 2024 | $570.8 | N/A |
| 9M 2023 | $574.5 | N/A |
Asset Quality Metrics
As of September 30, 2024, nonaccrual loans were $349 million, representing 0.65% of funded loans. The allowance for credit losses to funded loans was 0.74%.
| Metric | Value |
|---|---|
| Nonaccrual Loans (in millions) | $349 |
| Allowance for Credit Losses to Funded Loans (%) | 0.74 |
| Net Charge-Offs to Average Loans Outstanding (%) | 0.20 |
Western Alliance Bancorporation (WAL) DCF Excel Template
5-Year Financial Model
40+ Charts & Metrics
DCF & Multiple Valuation
Free Email Support
Article updated on 8 Nov 2024
Resources:
- Western Alliance Bancorporation (WAL) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Western Alliance Bancorporation (WAL)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Western Alliance Bancorporation (WAL)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.