Western Alliance Bancorporation (NYSE: WAL) announced today its
financial results for the fourth quarter 2013.
Fourth Quarter 2013 Highlights:
- Net income of $31.4 million, compared
to $28.2 million for the third quarter 2013 and $32.1 million for
the fourth quarter 2012
- Net income of $29.8 million for the
fourth quarter 2013, excluding the following, net of tax effect:
$3.7 million tax benefit related to the Western Liberty
acquisition, $1.3 million net gain on other repossessed assets,
$1.3 million net loss from debt valuation adjustments and
securities gains, $1.2 million merger/restructure expenses, and
$0.9 million net loss on extinguishment of debt
- Earnings per share of $0.36, compared
to $0.32 per share in the third quarter 2013 and $0.37 per share in
the fourth quarter 2012
- Earnings per share of $0.34 for the
fourth quarter 2013, excluding the following, net of tax effect:
$0.04 tax benefit related to the Western Liberty acquisition, $0.02
net gain on other repossessed assets, $0.02 net loss from debt
valuation adjustments and securities gains, $0.01
merger/restructure expenses, and $0.01 net loss on extinguishment
of debt
- Pre-tax, pre-provision operating
earnings of $43.8 million, up 4.2% from $42.1 million in third
quarter 2013 and up 19.1% from $36.8 million in fourth quarter
20121
- Net interest margin of 4.44%, compared
to 4.41% in the third quarter 2013 and 4.55% in the fourth quarter
2012
- Total loans of $6.80 billion, up $285
million from September 30, 2013
- Total deposits of $7.84 billion, up
$563 million from September 30, 2013
- Nonperforming assets (nonaccrual loans
and repossessed assets) decreased to 1.5% of total assets from 1.7%
in the third quarter 2013 and from 2.4% in the fourth quarter
2012
- Net loan charge-offs (annualized) to
average loans outstanding of 0.13%, compared to net loan recoveries
to average loans of 0.10% in the third quarter 2013 and net loan
charge-offs to average loans of 0.99% in the fourth quarter
2012
- Tier I Leverage capital of 9.8% and
Total Risk-Based Capital ratio of 12.6%, compared to 10.1% and
12.6%, respectively, at December 31, 2013
- Total equity of $855 million, up $96
million from December 31, 2012
Full Year 2013 Highlights:
- Net income of $114.5 million, compared
to $72.8 million for 2012
- Return on assets and return on tangible
common equity of 1.35% and 16.67%, compared to 1.01% and 12.37%,
respectively, in 2012
- Earnings per share of $1.31, compared
to $0.83 per share for 2012
- Net interest margin of 4.39%, compared
to 4.49% in 2012
- Total loan and deposit growth of $1.09
billion and $1.38 billion, respectively, from December 31,
2012
Financial Performance
“2013 was an outstanding year for Western Alliance, with
exceptional balance sheet growth, record revenue and earnings, and
low credit losses,” said Robert Sarver, Chairman and Chief
Executive Officer of Western Alliance Bancorporation. “Our team of
professionals from the front line to the back office have driven
our strong performance as we continue to win business. During the
fourth quarter, our loan and deposit growth accelerated without
sacrificing quality and margin.”
Sarver continued, “On December 31, 2013, we consolidated our
three affiliate banks under one charter, which will enable us to
improve efficiency and risk identification and management, while
maintaining our high level of customer service and
responsiveness.”
Income Statement
Net interest income was $90.0 million in the fourth quarter
2013, an increase of $5.4 million, or 6.4%, from $84.6 million in
the third quarter of 2013 and an increase of $12.5 million, or
16.2%, compared to the fourth quarter 2012. The Company’s net
interest margin increased in the fourth quarter 2013 to 4.44%,
compared to 4.41% in the third quarter 2013 and declined from 4.55%
in the fourth quarter 2012.
Operating non-interest income was $5.2 million for the fourth
quarter 2013, compared to $5.8 million in the third quarter of 2013
and $5.1 million for the fourth quarter of 2012.1
Net operating revenue was $95.2 million for the fourth quarter
2013, an increase of 5.3% compared to $90.4 million for the third
quarter of 2013 and an increase of 15.3% compared to $82.5 million
for the fourth quarter 2012.1
Operating non-interest expense was $51.4 million for the fourth
quarter 2013, compared to $48.3 million for the third quarter of
2013 and $45.8 million for the fourth quarter of 2012.1 The
Company’s operating efficiency ratio1 on a tax equivalent basis was
51.9% for the fourth quarter 2013, compared to 51.6% for the third
quarter 2013 and an improvement from 53.5% for the fourth quarter
2012.
Income tax expense decreased as a result of increased
deductibility of credit losses related to the Western Liberty
acquisition.
The Company had 1,051 full-time equivalent employees and 40
offices at December 31, 2013, compared to 982 employees and 40
offices at December 31, 2012.
The Company views its pre-tax, pre-provision operating earnings
as a key metric for assessing the Company’s earning power, which it
defines as net operating revenue less operating non-interest
expense. For the fourth quarter 2013, the Company’s pre-tax,
pre-provision operating earnings were $43.8 million, up from $42.1
million in the third quarter 2013 and up 19.1% from $36.8 million
in the fourth quarter 2012.1
The provision for credit losses was $4.3 million for the fourth
quarter 2013, compared to zero in the third quarter 2013 and $11.5
million for the fourth quarter 2012. Net loan charge-offs in the
fourth quarter 2013 were $2.1 million, or 0.13% of average loans
(annualized), compared to net loan recoveries to average loans of
0.10% for the third quarter 2013. Net charge-offs for the fourth
quarter 2012 were $13.5 million, or 0.99% of average loans
(annualized).
Nonaccrual loans decreased $1.0 million to $75.7 million during
the quarter. Loans past due 90 days and still accruing interest
totaled $1.5 million at December 31, 2013, compared to $5.5 million
at September 30, 2013 and $1.4 million at December 31, 2012. Loans
past due 30-89 days, still accruing interest totaled $13.4 million
at quarter end, up from $8.7 million at September 30, 2013 and down
from $16.6 million at December 31, 2012.
As the Company’s asset quality improved and its capital
increased, the ratio of classified assets to Tier I capital plus
the allowance for credit losses, a common regulatory measure of
asset quality, improved to 27% at December 31, 2013 from 34% at
December 31, 2012.1
Net gain on repossessed assets (primarily other real estate) was
$2.2 million for the fourth quarter 2013, compared to a net loss of
$0.4 million in the third quarter 2013 and a net loss of $0.5
million in the fourth quarter 2012. At December 31, 2013, other
repossessed assets totaled $67 million, compared to $77 million at
September 30, 2013 and December 31, 2012.
Balance Sheet
Gross loans totaled $6.80 billion at December 31, 2013, an
increase of $285 million from September 30, 2013 and an increase of
$1.09 billion from $5.71 billion at December 31, 2012. At December
31, 2013, the allowance for credit losses was 1.47% of total loans,
compared to 1.50% at September 30, 2013 and 1.67% at December 31,
2012, reflecting an improvement in the Company’s asset profile.
Deposits totaled $7.84 billion at December 31, 2013, an increase
of $563 million from $7.28 billion at September 30, 2013 and an
increase of $1.38 billion from $6.46 billion at December 31, 2012.
Non-interest bearing deposits were $2.20 billion at December 31,
2013, compared to $1.97 billion at September 30, 2013 and $1.93
billion at December 31, 2012. Non-interest bearing deposits
comprised 28.1% of total deposits at December 31, 2013, compared to
29.9% at December 31, 2012, while the proportion of savings and
money market accounts increased to 42.2% from 39.9% during the same
period. Certificates of deposit as a percent of total deposits were
20.6% at December 31, 2013, compared to 21.2% at December 31, 2012.
The Company’s ratio of loans to deposits was 86.8% at December 31,
2013, compared to 89.6% at September 30, 2013 and 88.5% at December
31, 2012.
Stockholders’ equity at December 31, 2013 increased to $855
million from $826 million at September 30, 2013. At December 31,
2013, tangible common equity was 7.4% of tangible assets1 and total
risk-based capital was 12.6% of risk-weighted assets. The Company’s
tangible book value per share1 was $7.89 at December 31, 2013, up
15.4% during the past year.
Total assets increased 4.3% to $9.31 billion at December 31,
2013 from $8.92 billion at September 30, 2013, and 22.1% from $7.62
billion at December 31, 2012.
Segment Highlights
Western Alliance Bank reported loan growth of $245 million
during the fourth quarter 2013 and $797 million during the last 12
months to $2.83 billion. Fourth quarter loan growth came primarily
from commercial and industrial and construction and land
development loans. Deposits increased $233 million in the fourth
quarter and $840 million during the last 12 months to $3.06
billion. Net income for Western Alliance Bank was $12.7 million
during the fourth quarter 2013, compared with net income of $9.8
million during the third quarter of 2013 and $10.4 million during
the fourth quarter 2012.
Bank of Nevada reported that loans decreased by $102 million
during the fourth quarter of 2013 and increased $102 million during
the last 12 months to $2.29 billion at December 31, 2013. The
decline in fourth quarter loans came primarily from a decrease in
commercial real estate and commercial and industrial loans.
Deposits increased by $150 million in the fourth quarter of 2013
and increased $194 million over the last twelve months to $2.76
billion. Net income for Bank of Nevada was $13.0 million for the
fourth quarter 2013, compared with net income of $16.3 million for
the third quarter of 2013 and $7.6 million during the fourth
quarter 2012.
Torrey Pines Bank, exclusive of the discontinued operations of
PartnersFirst, reported that loans increased $100 million during
the fourth quarter 2013 and increased $116 million during the last
12 months to $1.62 billion. The fourth quarter increase in the loan
balances were primarily attributable to an increase in commercial
real estate and commercial and industrial loans. Deposits increased
$177 million in the fourth quarter 2013 and $342 million over the
last 12 months to $2.02 billion. Net income for Torrey Pines Bank
was $6.0 million during the fourth quarter 2013, compared with net
income of $4.6 million for the third quarter of 2013 and $5.2
million during the fourth quarter 2012.
On December 31, 2013, the Company consolidated its three bank
subsidiaries under one charter, Western Alliance Bank. Prior to the
consolidation, Alliance Bank of Arizona and First Independent Bank
operated as divisions of Western Alliance Bank. In 2014, Bank of
Nevada and Torrey Pines Bank also will operate as divisions of
Western Alliance Bank.
Attached to this press release is summarized financial
information for the quarter ended December 31, 2013.
Conference Call and Webcast
Western Alliance Bancorporation will host a conference call and
live webcast to discuss its fourth quarter 2013 financial results
at 12:00 p.m. ET on Friday, January 24, 2014. Participants may
access the call by dialing 1-888-317-6003 and using passcode:
1025905 or via live audio webcast using the website link:
http://services.choruscall.com/links/wal140124.html.
The webcast is also available via the Company’s website at
www.westernalliancebancorp.com.
Participants should log in at least 15 minutes early to receive
instructions. The call will be recorded and made available for
replay after 2:00 p.m. ET January 24th through February 10th at
9:00 a.m. ET by dialing 1-877-344-7529 passcode: 10038670.
About Western Alliance Bancorporation
Western Alliance Bancorporation (NYSE: WAL) is a leading bank
holding company providing comprehensive business banking and
related financial services through its wholly-owned banking
subsidiary, Western Alliance Bank (the "Bank"). With local teams of
experienced bankers, the Bank provides a superior level of
capabilities, products and service, to assist the growth of local
businesses and the quality of life in the markets it serves. In
addition to a national platform of specialized financial service
units, the Bank operates full service banking divisions in its
local markets as Alliance Bank of Arizona, Bank of Nevada, First
Independent Bank and Torrey Pines Bank. Western Alliance
Bancorporation is publicly traded on the New York Stock Exchange.
Additional investor information can be accessed on the Investor
Relations page of the Company's website, www.westernalliancebancorp.com.
Cautionary Note Regarding Forward-Looking Statements
This release contains forward-looking statements that relate to
expectations, beliefs, projections, future plans and strategies,
anticipated events or trends and similar expressions concerning
matters that are not historical facts. Examples of forward-looking
statements include, among others, statements we make regarding
guidance or expectations relating to balance sheet growth, interest
margin, operating efficiency, asset quality, and regulatory
capital. The forward-looking statements contained herein reflect
our current views about future events and financial performance and
are subject to risks, uncertainties, assumptions and changes in
circumstances that may cause our actual results to differ
significantly from historical results and those expressed in any
forward-looking statement. Some factors that could cause actual
results to differ materially from historical or expected results
include, among others: factors discussed in the Company’s Annual
Report on Form 10-K for the year ended December 31, 2012 as filed
with the Securities and Exchange Commission; changes in general
economic conditions, either nationally or locally in the areas in
which we conduct or will conduct our business; inflation, interest
rate, market and monetary fluctuations; increases in competitive
pressures among financial institutions and businesses offering
similar products and services; higher defaults on our loan
portfolio than we expect; changes in management’s estimate of the
adequacy of the allowance for credit losses; legislative or
regulatory changes or changes in accounting principles, policies or
guidelines; supervisory actions by regulatory agencies which may
limit our ability to pursue certain growth opportunities;
management’s estimates and projections of interest rates and
interest rate policy; the execution of our business plan; and other
factors affecting the financial services industry generally or the
banking industry in particular.
Any forward-looking statement made by us in this release is
based only on information currently available to us and speaks only
as of the date on which it is made. We do not intend and disclaim
any duty or obligation to update or revise any industry information
or forward-looking statements, whether written or oral, that may be
made from time to time, set forth in this press release to reflect
new information, future events or otherwise.
This press release contains both financial measures based on
accounting principles generally accepted in the United States
(“GAAP”) and non-GAAP based financial measures, which are used
where management believes it to be helpful in understanding Western
Alliance Bancorporation’s results of operations or financial
position. Where non-GAAP financial measures are used, the
comparable GAAP financial measure, as well as the reconcilement to
the comparable GAAP financial measure, can be found in this press
release. These disclosures should not be viewed as a substitute for
operating results determined in accordance with GAAP, nor are they
necessarily comparable to non-GAAP performance measures that may be
presented by other companies.
1 See Reconciliation of Non-GAAP Financial Measures
Western Alliance Bancorporation and
Subsidiaries
Summary Consolidated Financial Data Unaudited
At or for the Three Months
EndedDecember 31,
For the Twelve Months Ended
December 31,
2013 2012 Change % 2013
2012 Change % Selected Balance Sheet
Data: (dollars in millions) Total assets $ 9,307.1 $ 7,622.6
22.1 % Loans, net of deferred fees 6,801.4 5,709.3 19.1 Securities
and money market investments 1,689.6 1,236.6 36.6 Total deposits
7,838.2 6,455.2 21.4 Borrowings 341.1 193.7 76.1 Junior
subordinated debt 41.9 36.2 15.7 Stockholders' equity 855.3 759.6
12.6
Selected Income Statement Data: (dollars in
thousands) Interest income $ 97,582 $ 84,343 15.7 % $ 362,655 $
318,295 13.9 % Interest expense 7,601 6,888 10.4
29,760 28,032 6.2 Net interest income 89,981 77,455
16.2 332,895 290,263 14.7 Provision for loan losses 4,300
11,501 (62.6 ) 13,220 46,844 (71.8 ) Net
interest income after provision for credit losses 85,681 65,954
29.9 319,675 243,419 31.3 Non-interest (loss) income (158 ) 24,463
(100.6 ) 17,228 44,726 (61.5 ) Non-interest expense 51,131
48,989 4.4 196,266 188,860 3.9 Income from
continuing operations, before income tax expense 34,392 41,428
(17.0 ) 140,637 99,285 41.6 Income tax expense 2,341 7,509
(68.8 ) 25,254 23,961 5.4 Income from
continuing operations 32,051 33,919 (5.5 ) 115,383 75,324 53.2 Loss
on discontinued operations, net (701 ) (1,804 ) (61.1 ) (861 )
(2,490 ) (65.4 ) Net income $ 31,350 $ 32,115 (2.4 )%
$ 114,522 $ 72,834 57.2 % Diluted net income per
common share from continuing operations $ 0.37 $ 0.39
(5.1 )% $ 1.32 $ 0.86 53.5 % Diluted net loss per
common share from discontinued operations, net of tax $ (0.01 ) $
(0.02 ) $ (0.01 ) $ (0.03 ) Diluted net income per common share $
0.36 $ 0.37 (2.7 )% $ 1.31 $ 0.83 57.8
%
Common Share Data: Diluted net income per common
share $ 0.36 $ 0.37 (2.7 )% $ 1.31 $ 0.83 57.8 % Book value per
common share $ 8.19 $ 7.15 14.5 % Tangible book value per share,
net of tax (1) $ 7.89 $ 6.84 15.4 % Average shares outstanding (in
thousands): Basic 85,939 84,416 1.8 85,682 82,285 4.1 Diluted
86,877 85,152 2.0 86,541 82,912 4.4 Common shares outstanding
87,186 86,465 0.8 (1) See Reconciliation of Non-GAAP
Financial Measures
Western Alliance Bancorporation
and Subsidiaries Summary Consolidated Financial Data
(continued)
Unaudited
At or for the Three Months
EndedDecember 31,
For the Twelve Months Ended
December 31,
2013 2012 Change % 2013
2012 Change % Selected Performance
Ratios: Return on average assets (1) 1.37 % 1.68 % (18.5 )%
1.35 % 1.01 % 33.7 % Return on tangible common equity (2) 18.11
21.70 (16.5 ) 16.67 12.37 34.8 Net interest margin (1) 4.44 4.55
(2.4 ) 4.39 4.49 (2.2 ) Net interest spread 4.27 4.37 (2.3 ) 4.23
4.31 (1.9 ) Efficiency ratio - tax equivalent basis (2) 51.92 53.48
(2.9 ) 52.51 55.39 (5.2 ) Loan to deposit ratio 86.77 88.45 (1.9 )
Capital Ratios: Tangible equity (2) 8.9 % 9.6 % (7.3
)% Tangible common equity (2) 7.4 7.8 (5.1 ) Tier 1 common equity
(2) 8.9 8.6 3.5 Tier 1 Leverage ratio (3) 9.8 10.1 (3.0 ) Tier 1
Risk Based Capital (3) 11.4 11.3 0.9 Total Risk Based Capital (3)
12.6 12.6 —
Asset Quality Ratios: Net charge-offs to
average loans outstanding (1) 0.13 % 0.99 % (86.9 )% 0.14 % 0.99 %
(85.9 )% Nonaccrual loans to gross loans
1.11
1.83
(39.3
)
Nonaccrual loans and repossessed assets to total assets
1.53
2.39
(36.0
) Loans past due 90 days and still accruing to total loans 0.02
0.02 — Allowance for credit losses to loans 1.47 1.67 (12.0 )
Allowance for credit losses to nonaccrual loans
132.20
91.13
45.1
(1) Annualized for the three month periods ended December
31, 2013 and 2012. (2) See Reconciliation of Non-GAAP Financial
Measures. (3) Capital ratios are preliminary until the Call Report
is filed.
Western Alliance Bancorporation and
Subsidiaries Condensed Consolidated Income Statements
Unaudited
Three Months EndedDecember
31,
Twelve Months EndedDecember
31,
2013 2012 2013
2012 Interest income: (dollars in thousands) Loans $ 86,902
$ 75,303 $ 326,714 $ 280,985 Investment securities 10,137 8,794
34,403 36,802 Federal funds sold and other 543 246
1,538 508
Total interest income 97,582
84,343 362,655 318,295 Interest expense:
Deposits 4,442 3,890 16,335 16,794 Borrowings 2,717 2,528 11,602
9,310 Junior subordinated debt 442 470 1,823
1,928
Total interest expense 7,601 6,888
29,760 28,032
Net interest income
89,981 77,455 332,895 290,263 Provision for credit losses 4,300
11,501 13,220 46,844
Net interest
income after provision for credit losses 85,681 65,954
319,675 243,419 Non-interest income (loss):
Service charges 2,512 2,438 9,920 9,452 Bank owned life insurance
905 1,080 4,809 4,439 Amortization of affordable housing
investments (1,714 ) (1,069 ) (5,018 ) (1,779 ) Gains (losses) on
sales of investment securities, net 342 1,447 (1,195 ) 3,949
Unrealized (losses) gains on assets/liabilities measured at fair
value, net (2,618 ) (48 ) (6,386 ) 653 Loss on extinguishment of
debt (1,387 ) — (1,387 ) — Bargain purchase gain from acquisition —
17,562 10,044 17,562 Other 1,802 3,053 6,441
10,450
Total non-interest (loss) income (158 ) 24,463
17,228 44,726 Non-interest expenses: Salaries
and employee benefits 30,071 26,885 113,434 105,044 Occupancy 4,626
4,769 19,126 18,815 Legal, professional and directors' fees 4,623
2,418 13,633 10,237 Insurance 1,744 2,188 8,094 8,511 Data
Processing 2,040 2,071 7,952 5,749 Marketing 619 575 2,581 2,305
Loan and repossessed asset expenses 793 2,102 4,246 6,675 Customer
service 860 678 2,897 2,604 Net (gain) loss on sales and valuations
of repossessed assets (2,153 ) 529 (2,387 ) 4,207 Intangible
amortization 597 596 2,388 3,256 Merger / restructure expense 1,919
2,706 5,752 2,819 Goodwill and intangible impairment — — — 3,435
Other 5,392 3,472 18,550 15,203
Total non-interest expense 51,131 48,989
196,266 188,860 Income from continuing operations
before income taxes 34,392 41,428 140,637 99,285 Income tax expense
2,341 7,509 25,254 23,961
Income
from continuing operations $ 32,051 $ 33,919 $ 115,383 $ 75,324
Loss from discontinued operations net of tax benefit (701 ) (1,804
) (861 ) (2,490 )
Net income $ 31,350 $ 32,115 $ 114,522 $
72,834 Preferred stock dividends 353 353 1,411
3,793
Net income available to common stockholders $
30,997 $ 31,762 $ 113,111 $ 69,041
Diluted net income per share $ 0.36 $ 0.37 $
1.31 $ 0.83
Western Alliance
Bancorporation and Subsidiaries Five Quarter Condensed
Consolidated Income Statements Unaudited
Three Months Ended
Dec 31, 2013
Sep 30, 2013
Jun 30, 2013
Mar 31, 2013
Dec 31, 2012
Interest income: (in thousands, except per share data) Loans $
86,902 $ 83,994 $ 81,093 $ 74,725 $ 75,303 Investment securities
10,137 8,286 7,822 8,158 8,794 Federal funds sold and other 543
400 370 225 246
Total
interest income 97,582 92,680 89,285
83,108 84,343 Interest expense: Deposits 4,442 4,232
3,929 3,732 3,890 Borrowings 2,717 3,429 2,749 2,707 2,528 Junior
subordinated debt 442 460 455 466 470
Total interest expense 7,601 8,121
7,133 6,905 6,888
Net interest income
89,981 84,559 82,152 76,203 77,455 Provision for credit losses
4,300 — 3,481 5,439 11,501
Net interest income after provision for credit losses 85,681
84,559 78,671 70,764 65,954
Non-interest income (loss): Service charges 2,512 2,425 2,449 2,534
2,438 Bank owned life insurance 905 1,832 1,036 1,036 1,080
Amortization of affordable housing investments (1,714 ) (1,504 )
(900 ) (900 ) (1,069 ) Gains (losses) on sales of investment
securities, net 342 (1,679 ) (5 ) 147 1,447 Unrealized losses on
assets/liabilities measured at fair value, net (2,618 ) (7 ) (3,290
) (471 ) (48 ) Loss on extinguishment of debt (1,387 ) — — — —
Bargain purchase gain from acquisition — — 10,044 — 17,562 Other
1,802 1,558 1,528 1,553 3,053
Total non-interest (loss) income (158 ) 2,625 10,862
3,899 24,463 Non-interest expenses: Salaries
and employee benefits 30,071 28,689 28,100 26,574 26,885 Occupancy
4,626 4,901 4,753 4,846 4,769 Legal, professional and directors'
fees 4,623 3,438 2,549 3,023 2,418 Insurance 1,744 1,884 2,096
2,370 2,188 Data Processing 2,040 1,872 2,175 1,865 2,071 Marketing
619 585 710 667 575 Loan and repossessed asset expenses 793 1,136
721 1,596 2,102 Customer service 860 677 717 643 678 Net (gain)
loss on sales and valuations of repossessed assets (2,153 ) 371
(1,124 ) 519 529 Intangible amortization 597 597 597 597 596 Merger
/ restructure expense 1,919 1,018 2,620 195 2,706 Other 5,392
4,507 4,617 4,034 3,472
Total
non-interest expense 51,131 49,675 48,531
46,929 48,989 Income from continuing operations
before income taxes 34,392 37,509 41,002 27,734 41,428 Income tax
expense 2,341 9,288 6,817 6,808 7,509
Income from continuing operations $ 32,051 $ 28,221 $
34,185 $ 20,926 $ 33,919 (Loss) Income from discontinued
operations, net of tax (701 ) (29 ) (169 ) 38 (1,804 )
Net income $ 31,350 $ 28,192 $ 34,016 $
20,964 $ 32,115 Preferred stock dividends 353
352 353 353 353
Net Income available
to common stockholders $ 30,997 $ 27,840 $ 33,663
$ 20,611 $ 31,762 Diluted net income
per share $ 0.36 $ 0.32 $ 0.39 $ 0.24 $
0.37
Western Alliance Bancorporation and
Subsidiaries Five Quarter Condensed Consolidated Balance
Sheets Unaudited
Dec 31, 2013
Sep 30, 2013 Jun 30, 2013
Mar 31, 2013 Dec 31, 2012 (in
millions)
Assets: Cash and due from banks $ 305.2 $ 380.9 $
248.9 $ 422.3 $ 204.6 Securities purchased under agreement to
resell — 128.1 134.0 134.0 —
Cash and cash equivalents 305.2 509.0 382.9 556.3 204.6
Securities and money market investments 1,689.6 1,370.8
1,313.1 1,302.4 1,236.6 Loans held for sale — 25.4 27.6 27.9 31.1
Loans held for investment: Commercial 2,478.2 2,234.9 2,174.1
2,084.9 1,947.8 Commercial real estate - non-owner occupied 1,841.1
1,864.3 1,839.7 1,538.4 1,505.6 Commercial real estate - owner
occupied 1,561.9 1,551.2 1,550.0 1,414.3 1,396.8 Construction and
land development 535.7 459.8 416.7 381.1 394.3 Residential real
estate 350.3 359.0 381.7 388.7 407.9 Consumer 43.1 29.8 28.5 26.0
31.8 Deferred fees, net (8.9 ) (8.1 ) (6.8 ) (6.0 ) (6.0 )
Gross
loans and deferred fees, net 6,801.4 6,490.9 6,383.9 5,827.4
5,678.2 Allowance for credit losses (100.1 ) (97.9 ) (96.3 ) (95.5
) (95.4 )
Loans, net 6,701.3 6,393.0 6,287.6
5,731.9 5,582.8 Premises and equipment,
net 120.2 105.9 106.1 107.1 107.9 Other repossessed assets 66.7
76.5 76.5 77.9 77.2 Bank owned life insurance 140.6 139.7 140.4
139.4 138.3 Goodwill and other intangibles 27.4 27.9 28.5 29.2 29.8
Other assets 256.1 273.2 231.0 202.0
214.3
Total assets $ 9,307.1 $ 8,921.4
$ 8,593.7 $ 8,174.1 $ 7,622.6
Liabilities
and Stockholders' Equity: Liabilities: Deposits: Non-interest
bearing demand deposits $ 2,200.0 $ 1,972.5 $ 1,919.6 $ 1,930.4 $
1,933.2 Interest bearing: Demand 709.8 673.7 631.3 619.7 582.3
Savings and money market 3,310.4 3,050.0 2,945.1 2,826.7 2,573.5
Time certificates 1,618.0 1,579.1 1,505.3
1,358.1 1,366.2
Total deposits 7,838.2 7,275.3
7,001.3 6,734.9 6,455.2 Customer repurchase agreements 71.2
55.5 51.9 64.7 79.0
Total customer
funds 7,909.4 7,330.8 7,053.2 6,799.6 6,534.2 Securities sold
short — 126.6 129.5 132.6 — Borrowings 341.1 394.1 418.6 293.8
193.7 Junior subordinated debt 41.9 39.4 39.9 36.7 36.2 Accrued
interest payable and other liabilities 159.4 204.2
153.0 130.1 98.9
Total liabilities
8,451.8 8,095.1 7,794.2 7,392.8 6,863.0
Stockholders' Equity Common stock and additional paid-in
capital 797.2 792.2 789.5 786.9 784.9 Preferred stock 141.0 141.0
141.0 141.0 141.0 Accumulated deficit (61.4 ) (92.4 ) (120.2 )
(153.8 ) (174.5 ) Accumulated other comprehensive (loss) income
(21.5 ) (14.5 ) (10.8 ) 7.2 8.2
Total
stockholders' equity 855.3 826.3 799.5
781.3 759.6
Total liabilities and stockholders'
equity $ 9,307.1 $ 8,921.4 $ 8,593.7 $
8,174.1 $ 7,622.6
Western Alliance
Bancorporation and Subsidiaries Changes in the Allowance For
Credit Losses Unaudited Three Months
Ended Dec 31, 2013 Sep 30, 2013
Jun 30, 2013 Mar 31, 2013
Dec 31, 2012 (in thousands) Balance, beginning
of period $ 97,851 $ 96,323 $ 95,494 $ 95,427 $ 97,410 Provision
for credit losses 4,300 — 3,481 5,439 11,501 Recoveries of loans
previously charged-off: Commercial and industrial 666 2,242 1,757
441 372 Commercial real estate - non-owner occupied 395 273 154 440
288 Commercial real estate - owner occupied 297 149 479 502 109
Construction and land development 273 966 120 701 2,033 Residential
real estate 549 430 549 569 313 Consumer 179 726 11
14 63 Total recoveries 2,359 4,786 3,070 2,667
3,178 Loans charged-off: Commercial and industrial 621 544 1,065
1,770 4,654 Commercial real estate - non-owner occupied 2,268 466
1,000 1,908 2,673 Commercial real estate - owner occupied 238 398
1,391 979 4,470 Construction and land development 686 — 238 614 405
Residential real estate 281 1,138 2,010 2,493 1,307 Consumer 366
712 18 275 3,153 Total loans
charged-off 4,460 3,258 5,722 8,039 16,662 Net loan charge-offs
(recoveries) 2,101 (1,528 ) 2,652 5,372 13,484
Balance, end of period $ 100,050 $ 97,851 $
96,323 $ 95,494 $ 95,427 Net
charge-offs (recoveries) to average loans outstanding - annualized
0.13 % (0.10 )% 0.17 % 0.38 % 0.99 % Allowance for credit losses to
gross loans 1.47 1.50 1.50 1.63 1.67 Nonaccrual loans $
75,681
$ 76,641 $ 82,899 $ 93,748 $ 104,716 Repossessed assets 66,719
76,475 76,499 77,921 77,247 Loans past due 90 days, still accruing
1,534 5,456 3,893 1,640 1,388 Loans past due 30 to 89 days, still
accruing 13,425 8,689 7,341 14,795 16,565 Classified loans on
accrual 128,586 144,041 140,192 97,351 112,637 Special mention
loans 129,965 137,247 162,482 125,660 103,550
Western
Alliance Bancorporation and Subsidiaries Analysis of Average
Balances, Yields and Rates Unaudited
Three Months Ended December 31, 2013 2012
AverageBalance
Interest
AverageYield/ Cost
AverageBalance
Interest
AverageYield/ Cost
Interest earning assets ($ in millions) ($ in thousands) ($
in millions) ($ in thousands) Loans (1) $ 6,515.2 $ 86,902 5.48 % $
5,450.0 $ 75,303 5.60 % Investment securities (1) 1,488.8 10,137
3.11 1,329.3 8,794 3.25 Federal funds sold and other 447.5
543 0.49 300.4 246 0.33 Total
interest earning assets 8,451.5 97,582 4.79 7,079.7 84,343 4.94
Non-interest earning assets Cash and due from banks 132.7
121.2 Allowance for credit losses (98.4 ) (99.1 ) Bank owned life
insurance 140.0 137.6 Other assets 465.6 364.0
Total assets $ 9,091.4 $ 7,603.4
Interest-bearing liabilities Interest-bearing deposits:
Interest-bearing transaction accounts $ 676.8 $ 360 0.21 % $ 528.1
$ 301 0.23 % Savings and money market 3,175.1 2,390 0.30 2,539.8
1,973 0.31 Time certificates of deposit 1,592.4 1,692
0.43 1,406.9 1,616 0.46
Total
interest-bearing deposits 5,444.3 4,442 0.33 4,474.8 3,890 0.35
Borrowings 414.6 2,717 2.62 299.6 2,528 3.38 Junior subordinated
debt 39.5 442 4.48 36.2 470 5.19
Total interest-bearing liabilities 5,898.4 7,601 0.52
4,810.6 6,888 0.57
Noninterest-bearing liabilities
Noninterest-bearing demand deposits 2,091.8 1,948.4 Other
liabilities 249.1 94.4 Stockholders’ equity 852.1 750.0
Total liabilities and stockholders' equity $ 9,091.4
$ 7,603.4 Net interest income and margin $ 89,981
4.44 % $ 77,455 4.55 % Net interest spread 4.27 %
4.37 % (1) Yields on loans and securities have been adjusted
to a tax equivalent basis. The taxable-equivalent adjustment was
$3,728 and $3,012 for the fourth quarter ended 2013 and 2012,
respectively.
Western Alliance Bancorporation and
Subsidiaries Analysis of Average Balances, Yields and
Rates Unaudited Twelve Months Ended
December 31, 2013 2012
AverageBalance
Interest
AverageYield/ Cost
AverageBalance
Interest
AverageYield/ Cost
Interest earning Assets ($ in millions) ($ in thousands) ($
in millions) ($ in thousands) Loans (1) $ 6,136.2 $ 326,714 5.43 %
$ 5,110.2 $ 280,985 5.55 % Investment securities (1) 1,342.0 34,403
3.07 1,385.3 36,802 3.17 Federal funds sold & other 409.4
1,538 0.38 189.5 508 0.27
Total interest earnings assets 7,887.6 362,655 4.77 6,685.0 318,295
4.91
Non-interest earning assets Cash and due from banks
128.5 116.9 Allowance for credit losses (97.5 ) (98.9 ) Bank owned
life insurance 139.8 136.0 Other assets 442.0 354.4
Total assets $ 8,500.4 $ 7,193.4
Interest-bearing liabilities Interest-bearing deposits:
Interest bearing transaction accounts $ 640.1 $ 1,407 0.22 % $
515.3 $ 1,220 0.24 % Savings and money market 2,936.1 8,480 0.29
2,371.5 8,088 0.34 Time certificates of deposits 1,488.0
6,448 0.43 1,359.5 7,486 0.55
Total interest-bearing deposits 5,064.2 16,335 0.32 4,246.3
16,794 0.40 Borrowings 408.6 11,602 2.84 369.0 9,310 2.52 Junior
subordinated debt 38.1 1,823 4.78 36.8
1,928 5.24
Total interest-bearing liabilities
5,510.9 29,760 0.54 4,652.1 28,032 0.60
Noninterest-bearing
liabilities Noninterest-bearing demand deposits 1,954.2 1,788.3
Other liabilities 111.8 62.0 Stockholders’ equity 923.5
691.0
Total liabilities and stockholders' equity $
8,500.4 $ 7,193.4 Net interest income and margin $
332,895 4.39 % $ 290,263 4.49 % Net interest spread
4.23 % 4.31 % (1) Yields on loans and securities have been
adjusted to a tax equivalent basis. The taxable-equivalent
adjustment was $13,312 and $9,738 for the twelve months ended
December 31, 2013 and 2012, respectively.
Western
Alliance Bancorporation and Subsidiaries Operating Segment
Results Unaudited
WesternAlliance Bank
Bank of Nevada
Torrey PinesBank*
Other
Inter-segmenteliminations
ConsolidatedCompany
At December 31, 2013 (dollars in millions) Assets 3,551.0
3,426.0 2,258.1 993.1 (921.1 ) 9,307.1 Held for sale loans — — — —
— — Gross loans and deferred fees, net 2,834.3 2,285.6 1,624.5 57.0
—
6,801.4 Less: Allowance for credit losses (30.1 ) (51.0 ) (18.3 )
(0.7 ) — (100.1 ) Loans, net 2,804.2 2,234.6
1,606.2 56.3 — 6,701.3 Goodwill
and intangible assets 2.6 24.8 — — — 27.4 Deposits 3,064.6 2,763.2
2,021.3 — (10.9 ) 7,838.2 Borrowings 73.9 200.0 — 67.2 — 341.1
Stockholders' equity 303.5 368.3 174.5 873.1 (864.1 ) 855.3
No. of branches 17 11 12 — — 40 No. of FTE 292 393 230 136 — 1,051
Three Months Ended December 31, 2013: (in thousands)
Net interest income (expense) $ 37,299 $ 30,978 $ 22,922 $ (1,218 )
$ — $ 89,981 Provision for credit losses 2,579 1,100
621 — — 4,300
Net interest income (expense) after
provision for credit losses
34,720 29,878 22,301 (1,218 ) — 85,681 Non-interest income 1,335
4,798 911 (1,584 ) (5,618 ) (158 ) Non-interest expense (17,655 )
(19,487 ) (13,144 ) (6,463 ) 5,618 (51,131 )
Income (loss) from continuing operations
before income taxes
18,400 15,189 10,068 (9,265 ) — 34,392 Income tax expense (benefit)
5,732 2,166 4,027 (9,584 ) — 2,341
Income from continuing operations 12,668 13,023 6,041 319 —
32,051 Loss from discontinued operations, net — — —
(701 ) — (701 )
Net income (loss) $ 12,668
$ 13,023 $ 6,041 $ (382 ) $ — $ 31,350
Twelve Months Ended December 31, 2013: (in
thousands) Net interest income (expense) $ 130,219 $ 122,799 $
85,357 $ (5,480 ) $ — $ 332,895 Provision for (recovery of) credit
losses 12,500 (4,414 ) 3,840 1,294 —
13,220
Net interest income (expense) after
provision for credit losses
117,719 127,213 81,517 (6,774 ) — 319,675 Non-interest income (1)
15,855 14,181 2,223 2,741 (17,772 ) 17,228 Non-interest expense
(63,343 ) (72,211 ) (49,020 ) (29,464 ) 17,772 (196,266 )
Income (loss) from continuing operations
before income taxes
70,231
69,183 34,720 (33,497 ) — 140,637 Income tax expense (benefit)
18,798 16,458 11,925 (21,927 ) — 25,254
Income (loss) from continuing operations 51,433 52,725
22,795 (11,570 ) — 115,383 Loss from discontinued operations, net —
— — (861 ) — (861 )
Net income
(loss) $ 51,433 $ 52,725 $ 22,795 $
(12,431 ) $ — $ 114,522 * Excludes
discontinued operations (1) Includes bargain purchase gain from
acquisition
Western Alliance Bancorporation and
Subsidiaries Operating Segment Results Unaudited
WesternAlliance Bank
Bank of Nevada
Torrey PinesBank*
Other
Inter-segmenteliminations
ConsolidatedCompany
At December 31, 2012 (dollars in millions) Assets 2,565.1
3,029.1 2,019.8 902.0 (893.4 ) 7,622.6 Held for sale loans — — 31.1
— — 31.1 Gross loans and deferred fees, net 2,037.1 2,183.3 1,477.1
23.5 (42.8 ) 5,678.2 Less: Allowance for credit losses (21.3 )
(58.2 ) (15.6 ) (0.3 ) — (95.4 ) Loans, net 2,015.8
2,125.1 1,461.5 23.2 (42.8 ) 5,582.8
Goodwill and intangible assets 3.5 26.3 — — — 29.8 Deposits 2,224.2
2,569.1 1,679.3 — (17.4 ) 6,455.2 Borrowings 45.0 — 110.0 73.7
(35.0 ) 193.7 Stockholders' equity 224.0 378.2 169.1 780.9 (792.6 )
759.6 No. of branches 16 12 12 0 0 40 No. of FTE 254 400 233
95 0 982
Three Months Ended December 31, 2012: (in
thousands) Net interest income (expense) $ 26,745 $ 30,127 $ 22,247
$ (1,664 ) $ — $ 77,455 Provision for credit losses 1,369
6,532 3,300 300 — 11,501
Net interest income (expense) after
provision for credit losses
25,376
23,595 18,947 (1,964 ) — 65,954 Non-interest income (1) 1,546 5,269
763 19,959 (3,074 ) 24,463 Non-interest expense (13,155 ) (18,616 )
(11,349 ) (8,943 ) 3,074 (48,989 )
Income (loss) from continuing operations
before income taxes
13,767 10,248 8,361 9,052 — 41,428 Income tax expense (benefit)
3,349 2,692 3,146 (1,678 ) — 7,509
Income from continuing operations 10,418 7,556 5,215 10,730
— 33,919 Loss from discontinued operations, net — — —
(1,804 ) — (1,804 )
Net income (loss) $ 10,418
$ 7,556 $ 5,215 $ 8,926 $ — $
32,115
Twelve Months Ended December 31, 2012:
(in thousands) Net interest income (expense) $ 98,309 $ 113,181 $
86,653 $ (7,880 ) $ — $ 290,263 Provision for credit losses 2,584
35,378 8,582 300 — 46,844
Net interest income (expense) after
provision for credit losses
95,725 77,803 78,071 (8,180 ) — 243,419 Non-interest income (1)
6,566 16,401 3,875 29,684 (11,800 ) 44,726 Non-interest expense
(49,141 ) (72,052 ) (44,841 ) (34,626 ) 11,800 (188,860 )
Income (loss) from continuing operations
before income taxes
53,150 22,152 37,105 (13,122 ) — 99,285 Income tax expense
(benefit) 16,380 4,033 14,401 (10,853 ) —
23,961 Income from continuing operations 36,770
18,119 22,704 (2,269 ) — 75,324 Loss from discontinued operations,
net — — — (2,490 ) — (2,490 )
Net
income (loss) $ 36,770 $ 18,119 $ 22,704 $
(4,759 ) $ — $ 72,834 * Excludes discontinued
operations (1) Includes bargain purchase gain from acquisition
Western Alliance Bancorporation and
Subsidiaries Reconciliation of Non-GAAP Financial Measures
(Unaudited) Dec 31, 2013 Sep 30, 2013
Jun 30, 2013 Mar 31, 2013 Dec 31, 2012
(dollars in thousands) Total stockholders' equity $ 855,250 $
826,287 $ 799,524 $ 781,294 $ 759,616 Less: Goodwill and intangible
assets 27,374 27,970 28,568 29,166
29,763
Total tangible stockholders' equity 827,876
798,317 770,956 752,128 729,853 Less: Preferred stock 141,000
141,000 141,000 141,000 141,000
Total tangible common equity 686,876 657,317 629,956 611,128
588,853 Add: Deferred tax 1,452 1,661 1,870
2,080 2,289
Total tangible common equity, net of
tax $ 688,328 $ 658,978 $ 631,826 $
613,208 $ 591,142 Total assets $ 9,307,095 $
8,921,429 $ 8,593,684 $ 8,174,103 $ 7,622,637 Less: Goodwill and
intangible assets 27,374 27,970 28,568 29,166
29,763 Tangible assets 9,279,721 8,893,459 8,565,116
8,144,937 7,592,874 Add: Deferred tax 1,452 1,661
1,870 2,080 2,289
Total tangible assets,
net of tax $ 9,281,173 $ 8,895,120 $ 8,566,986
$ 8,147,017 $ 7,595,163 Tangible equity ratio
(1) 8.9 % 9.0 % 9.0 % 9.2 % 9.6 % Tangible common equity ratio (2)
7.4 % 7.4 % 7.4 % 7.5 % 7.8 % Common shares outstanding 87,186
87,099 86,997 87,079 86,465 Tangible book value per share, net of
tax (3) $ 7.89 $ 7.57 $ 7.26 $ 7.04 $ 6.84
Three Months
Ended Dec 31, 2013 Sep 30, 2013 Jun 30,
2013 Mar 31, 2013 Dec 31, 2012 (in thousands)
Total non-interest income $ (158 ) $ 2,625 $ 10,862 $ 3,899 $
24,463 Less: Unrealized losses on assets/liabilities measuredat
fair value, net (2,618 ) (7 ) (3,290 ) (471 ) (48 ) Gain on sale of
subsidiary/non-controlling interest — — — — 116 Loss on
extinguishment of debt (1,387 ) Bargain purchase gain from
acquisition — — 10,044 — 17,562 Legal settlements — — — 38 879
Mutual fund gains — — — — 483 Amortization of affordable housing
investments (1,714 ) (1,504 ) (900 ) (900 ) (1,069 ) (Losses) Gains
on sales of investment securities, net 342 (1,679 ) (5 ) 147
1,447
Total operating non-interest income
5,219 5,815 5,013 5,085 5,093 Add: net interest income 89,981
84,559 82,152 76,203 77,455
Net operating revenue (4) $ 95,200 $ 90,374 $
87,165 $ 81,288 $ 82,548 Total
non-interest expense $ 51,131 $ 49,675 $ 48,531 $ 46,929 $ 48,989
Less: Net loss (gain) on sales and valuations of repossessed assets
(2,153 ) 371 (1,124 ) 519 529 Merger / restructure expense 1,919
1,018 2,620 195 2,706
Total
operating non-interest expense (4) $ 51,365 $ 48,286
$ 47,035 $ 46,215 $ 45,754 Net
operating revenue $ 95,200 $ 90,374 $ 87,165 $ 81,288 $ 82,548
Less: Operating non-interest expense 51,365 48,286
47,035 46,215 45,754
Pre-tax, pre-provision
operating earnings (5) $ 43,835 $ 42,088 $ 40,130
$ 35,073 $ 36,794
Western Alliance Bancorporation and
Subsidiaries
Reconciliation of Non-GAAP Financial Measures (Unaudited)
Three Months Ended
Dec 31, 2013
Sep 30, 2013 Jun 30, 2013 Mar 31, 2013 Dec
31, 2012 (in thousands)
Total operating non-interest expense
$ 51,365 $ 48,286 $ 47,035 $ 46,215 $
45,754
Divided by:
Total net interest income
$ 89,981 $ 84,559 $ 82,152 $ 76,203 $ 77,455
Add:
Tax equivalent interest adjustment
3,728 3,272 2,929 3,382 3,012
Operating non-interest income
5,219 5,815 5,013 5,085 5,093 $
98,928 $ 93,646 $ 90,094 $ 84,670 $
85,560
Efficiency ratio - tax equivalent basis
(6)
51.9 % 51.6 % 52.2 % 54.6 % 53.5 %
Twelve Months Ended
December 31, 2013 2012
Total operating non-interest expense
$ 192,901 $ 178,399
Divided by:
Total net interest income
$ 332,895 $ 290,263
Add:
Tax equivalent interest adjustment
13,312 9,738
Operating non-interest income
21,132 22,087 $ 367,339 $ 322,088
Efficiency ratio - tax equivalent basis
(6)
52.5 % 55.4 %
Three Months Ended December 31,
2013 2012 (in thousands)
Stockholders' equity
$ 855,250 $ 759,616
Less:
Accumulated other comprehensive (loss)
income
(21,546 ) 8,243
Non-qualifying goodwill and
intangibles
25,991 27,520
Other non-qualifying assets
— 2
Disallowed unrealized losses on equity
securities
8,059 —
Add:
Qualifying trust preferred securities
48,485 44,819
Tier 1 capital (regulatory) (7)
(10)
891,231 768,670
Less:
Qualifying non-controlling interests
— —
Qualifying trust preferred securities
48,485 44,819
Preferred stock
141,000 141,000
Estimated Tier 1 common equity (8)
(10)
$ 701,746 $ 582,851
Divided by:
Estimated risk-weighted assets
(regulatory (8) (10)
$ 7,845,866 $ 6,797,170
Tier 1 common equity ratio (8)
(10)
8.9 % 8.6 %
December 31, 2013 2012 (in
thousands)
Classified assets
$ 270,375 $ 294,519
Divide:
Tier 1 capital (regulatory) (7)
(10)
891,231 768,670
Plus: Allowance for credit losses
100,050 95,427
Total Tier 1 capital plus allowance for
credit losses
$ 991,281 $ 864,097
Classified assets to Tier 1 capital
plus allowance (9) (10)
27 % 34 %
(1) We believe this non-GAAP ratio
provides a critical metric with which to analyze and evaluate
financial condition and capital strength.
(2) We believe this non-GAAP ratio
provides a critical metric with which to analyze and evaluate
financial condition and capital strength.
(3) We believe this non-GAAP ratio
improves the comparability to other institutions that have not
engaged in acquisitions that resulted in
recorded goodwill and other intangibles.
(4) We believe these non-GAAP measurements
provide a useful indication of the cash generating capacity of the
Company.
(5) We believe this non-GAAP measurement
is a key indicator of the earnings power of the Company.
(6) We believe this non-GAAP ratio
provides a useful metric to measure the operating efficiency of the
Company.
(7) Under the guidelines of the Federal
Reserve and the Federal Deposit Insurance Corporation in effect,
Tier 1 capital consisted of common stock, retained earnings,
non-cumulative perpetual preferred stock, trust
preferred securities up to a certain limit, and minority interests
in certain subsidiaries, less most other intangible assets.
(8) Tier 1 common equity is often
expressed as a percentage of risk-weighted assets. Under
the risk-based capital framework, a bank's balance sheet
assets and credit equivalent amounts of off-balance
sheet items are assigned to one of four broad risk
categories. The aggregated dollar amount in
each category is then multiplied by the risk weighting
assigned to that category. The resulting weighted values
from each of the four categories are added together and
this sum is the risk-weighted assets total that, as adjusted,
comprises the denominator (risk-weighted assets) to determine the
Tier 1 capital ratio. Adjustments are made to Tier 1
capital to arrive at Tier 1 common equity. Tier 1 common
equity is divided by the risk-weighted assets to determine the Tier
1 common equity ratio. We believe this non-GAAP ratio
provides a critical metric with which to analyze and evaluate
financial condition and capital strength.
(9) We believe this non-GAAP ratio
provides a critical regulatory metric in which to analyze asset
quality.
(10) Current quarter is preliminary until
Call Reports are filed.
Western Alliance BancorporationDale Gibbons, 602-952-5476
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