How Are Regional Banks Doing In A Post-Apocalyptic... We Mean, Post-Silicon Valley Bank World?

Zinger Key Points
  • Shares of First Republic tanked after revealing massive deposit outflows and exploring strategic alternatives to shore up its balance sheet.
  • Western Alliance issued a 3.6% earnings rise, but deposits down 8.8% year over year. Zions and Truist both saw an earnings uptick.

The aftermath of SVB Financial Group's Silicon Valley Bank collapse rocked the financial world, and investors have been keeping a close eye on regional banks' volatile stocks affected by the significant bank failure.

Overall sentiment on the Street is that most regional banks are expected to report lower deposit levels as customers shift to more prominent institutions. Moderate earnings growth is expected to come from an increase in net interest income, already priced into the share prices.

Read Also: Awaiting Q1 GDP Results: Can US Economy Fend Off Recession Fears?

Shares of First Republic Bank FRC, the bank most investors are keeping on watchlists, tanked after revealing massive deposit outflows in its late Monday earnings, following mixed reports last week from the following:

  • Zions Bancorporation ZION
  • Western Alliance Bancorporation WAL
  • Truist Financial Corp TFC
  • KeyCorp KEY
  • Comerica Incorporated CMA
  • Regions Financial Corp RF

While First Republic's earnings dropped 38.5% to $1.23 per share, and revenue fell 13.4% to $1.2 billion, the bank is exploring strategic alternatives to reduce its asset-liability mismatch and shore up its balance sheet to avoid being seized by the FDIC.

The bank may sell $50 billion to $100 billion in long-term securities and mortgages and could offer warrants or preferred equity to potential buyers above market value.

On the other hand, Western Alliance reported adjusted earnings rose 3.6% to $2.30 per share, while Truist earnings rose 6% to $1.05 per share, and Regions earnings jumped nearly 13% to 62 cents per share.

Comerica earnings rocketed 74% to $2.39 per share, while KeyCorp earnings tumbled 33% to 30 cents per share.

Zions earnings rose 4.7% to $1.33 per share, and analysts expect adjusted earnings to tick up to $5.85 per share on 6% revenue growth for the full year.

Although it may take until 2024 for the firms to feel the full impacts of the March collapse, in the meantime, the Street expects some moderate earnings growth, driven by an increase in net interest income.

Are you buying the dip on regionals? Check out the price action below:





Zions Bancorporation




Western Alliance




Truist Financial








Comerica Inc




Regions Financial




First Republic




Read Next: First Republic Bank Shares Sink Another 20% With Report Of Government Unwilling To Come To The Rescue

Photos: Shutterstock

Market News and Data brought to you by Benzinga APIs
Actual EPS
EPS Surprise
Actual Rev
Rev Surprise
Posted In: EarningsLarge CapMid CapNewsSmall CapTop StoriesMarketsTrading Ideasbankbank collapsebanksregional banksSilicon Valley Bank
Benzinga simplifies the market for smarter investing

Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.

Join Now: Free!