US regional bank shares pac west tumbled Thursday morning on Wall Street after he reported that many clients withdrew deposits in early Mayreigniting nervousness in the financial sector.
Its shares plunged 28.8%. The PacWest has lost 77% since March 8, the start of a banking crisis that has shaken the world of finance for two months.
Los Angeles-based Pacific Western, or PacWest, is the 53rd-ranked bank in the United States by asset size.
It is now seen as the new weak link in the system following the bankruptcies of SVB and Signature Bank in March, and the government takeover of the First Republic in early May before its resale to JPMorgan Chase.
PacWest had already been rocked on Wall Street when it said on May 3, two days after the First Republic’s fall, that it was considering “all strategic options.”
The message was meant to be reassuring, but in a stock filing on Thursday, PacWest acknowledged that “this information (had) reinforced the fears of (its) customers about the security of their deposits.”
Result: For the week ending May 5, 2023, PacWest deposits fell about 9.5%, with most of that drop occurring on May 4 and 5.
The bank had already seen its total deposits fall 16.9% in the first quarter.
“These recent events and the media coverage to which they are subject have increased certain risks and uncertainties related to our activities and our future prospects,” the bank wrote.
PacWest says it has $15 billion in cash on hand.
Source: AFP
