Western Alliance Bancorporation (NYSE:WAL):
FIRST QUARTER 2022 FINANCIAL RESULTS
First Quarter Highlights:
Net income
Earnings per share
PPNR1
Net interest margin
Efficiency ratio1
Book value per common
share
$43.56
$240.1 million
$2.22
$307.2 million
3.32%
44.1%
$37.131, excluding
goodwill and intangibles
CEO COMMENTARY:
Western Alliance's national commercial
business strategy continued to deliver accelerating balance sheet
growth, surpassing the $60 billion asset milestone, and strong
financial performance results to kick off 2022,” said Kenneth A.
Vecchione, President and Chief Executive Officer. “Balance sheet
growth continued with loans up $2.0 billion (or 43.2%
year-over-year), and deposits up $4.5 billion (or 35.9%
year-over-year), bringing total assets to $60.6 billion at quarter
end, driving a 52.1% year-over-year increase in PPNR to $307.2
million. Net income of $240.1 million, earnings per share of $2.22
and return on tangible common equity of 23.9% for the first quarter
2022 mirrors the Company’s strong fourth quarter performance, while
tangible book value per share fell 1.9% quarterly to $37.13 due to
a decline in AOCI from fair value losses on investment securities.
Asset quality remained strong with nonperforming assets to total
assets of 0.17% and negligible net charge-offs for the
quarter."
Acquisition of Digital Disbursements and
AmeriHome Mortgage Company:
On January 25, 2022, the Company completed
its acquisition of Digital Settlement Technologies LLC, doing
business as Digital Disbursements, a digital payments platform for
the class action legal industry. On April 7, 2021, the Company
completed its acquisition of Aris Mortgage Holding Company, LLC,
the parent company of AmeriHome Mortgage Company, LLC
("AmeriHome"). The Company's results include the financial results
of Digital Disbursements and AmeriHome beginning on the acquisition
dates noted.
LINKED-QUARTER BASIS
YEAR-OVER-YEAR
FINANCIAL HIGHLIGHTS:
- Net income of $240.1 million and earnings per share of $2.22,
compared to $246.0 million and $2.32, respectively
- Net income of $240.1 million and earnings per share of $2.22,
up 24.7% and 16.8%, from $192.5 million and $1.90,
respectively
- Net revenue of $555.8 million, a decrease of 0.9%, or $5.2
million, compared to an increase in non-interest expenses of 4.5%,
or $10.8 million
- Net revenue of $555.8 million, an increase of 64.9%, or $218.8
million, compared to an increase in non-interest expenses of 84.1%,
or $113.6 million
- Pre-provision net revenue1 of $307.2 million, down $16.0
million from $323.2 million
- Pre-provision net revenue1 of $307.2 million, up $105.2 million
from $202.0 million
- Effective tax rate of 19.5%, compared to 20.6%
- Effective tax rate of 19.5%, compared to 17.9%
FINANCIAL POSITION RESULTS:
- HFI loans of $41.1 billion, up $2.0 billion, or 21.2%
annualized
- Increase in HFI loans of $12.4 billion, or 43.2%
- Total deposits of $52.2 billion, up $4.5 billion, or 38.7%
annualized
- Increase in total deposits of $13.8 billion, or 35.9%
- Stockholders' equity of $5.0 billion, up $49 million
- Increase in stockholders' equity of $1.3 billion
LOANS AND ASSET QUALITY:
- Nonperforming assets (nonaccrual loans and repossessed assets)
to total assets of 0.17%, compared to 0.15%
- Nonperforming assets to total assets of 0.17%, compared to
0.27%
- Annualized net loan charge-offs to average loans outstanding of
approximately 0.00%, compared to 0.02%
- Annualized net loan charge-offs to average loans outstanding of
approximately 0.00%, compared to 0.02%
KEY PERFORMANCE METRICS:
- Net interest margin of 3.32%, compared to 3.33%
- Net interest margin of 3.32%, compared to 3.37%
- Return on average assets and on tangible common equity1 of
1.64% and 23.9%, compared to 1.69% and 25.8%, respectively
- Return on average assets and on tangible common equity1 of
1.64% and 23.9%, compared to 1.93% and 24.2%, respectively
- Tangible common equity ratio1 of 6.7%, compared to 7.3%
- Tangible common equity ratio1 of 6.7%, compared to 7.9%
- Tangible book value per share1, net of tax, of $37.13, a
decrease of 1.9% from $37.84
- Tangible book value per share1, net of tax, of $37.13, an
increase of 12.4% from $33.02
- Efficiency ratio1 of 44.1%, compared to 41.8%
- Efficiency ratio1 of 44.1%, compared to 39.1%
1 See reconciliation of Non-GAAP Financial Measures.
Income Statement
Net interest income was $449.5 million in the first quarter
2022, a decrease of $1.1 million from $450.6 million in the fourth
quarter 2021, and an increase of $132.2 million, or 41.7%, compared
to the first quarter 2021. The decrease in net interest income from
the fourth quarter 2021 is due to two fewer days in the quarter, a
lower HFS loan balance and interest expense on debt issued in
December 2021, partially offset by higher yields on investment
securities and HFI loan growth. HFI loan growth and interest income
from HFS loans drove the increase in net interest income from the
first quarter 2021.
The Company recorded a provision for credit losses totaling $9.0
million in the first quarter 2022, a decrease of $4.2 million from
$13.2 million in the fourth quarter 2021, compared to a provision
release of $32.4 million in the first quarter 2021. The provision
for credit losses during the first quarter 2022 is primarily due to
loan growth.
The Company’s net interest margin in the first quarter 2022 was
3.32%, a decrease from 3.33% in the fourth quarter 2021, and a
decrease from 3.37% in the first quarter 2021. The decrease in net
interest margin from the prior quarter is largely a result of
increased rates on borrowings, a greater portion of earnings assets
held in cash, and lower yields on certain HFI loan types, partially
offset by higher yields on investment securities and HFS loans. The
decrease in net interest margin from the first quarter 2021 was
driven by lower yields on all HFI loan types, except CRE owner
occupied loans, and higher interest expense due to debt issued in
2021 and AmeriHome senior notes, partially offset by higher yields
on investment securities.
Non-interest income was $106.3 million for the first quarter
2022, compared to $110.4 million for the fourth quarter 2021, and
$19.7 million for the first quarter 2021. The $4.1 million decrease
in non-interest income from the fourth quarter 2021 was primarily
the result of a decrease in net gain on loan origination and sale
activities of $36.3 million from lower production volume, which was
offset entirely by an increase in loan servicing revenue of $38.8
million as rising interest rates and falling prepayment speeds
benefit MSR valuations and servicing income. Also contributing to
the decrease in non-interest income from the fourth quarter 2021
was a larger loss on fair value adjustments on assets measured at
fair value of $5.8 million, which was offset by a net gain on sales
of investment securities of $6.9 million for the first quarter 2022
(a decrease of $1.4 million from the prior quarter). Changes from
the fourth quarter 2021 for all other non-interest income items,
including gain on recovery from credit guarantees, income from
equity investments, and other, net to an increase of $0.6 million.
The increase in non-interest income from the first quarter 2021 is
primarily the result of mortgage banking related income.
Net revenue was $555.8 million for the first quarter 2022, a
decrease of $5.2 million, or (0.9)%, compared to $561.0 million for
the fourth quarter 2021, and an increase of $218.8 million, or
64.9%, compared to $337.0 million for the first quarter 2021.
Non-interest expense was $248.6 million for the first quarter
2022, compared to $237.8 million for the fourth quarter 2021, and
$135.0 million for the first quarter 2021. The Company’s efficiency
ratio1 was 44.1% for the first quarter 2022, compared to 41.8% in
the fourth quarter 2021, and 39.1% for the first quarter 2021.
Non-interest expense increased from the fourth quarter 2021 due to
increased compensation costs. The increase in non-interest expense
from the first quarter 2021 is attributable to growth from the
AmeriHome acquisition, which increased compensation costs and also
introduced additional non-interest expense items, such as loan
servicing and loan acquisition and origination expenses.
Income tax expense was $58.1 million for the first quarter 2022,
compared to $64.0 million for the fourth quarter 2021, and $41.9
million for the first quarter 2021.
Net income was $240.1 million for the first quarter 2022, a
decrease of $5.9 million from $246.0 million for the fourth quarter
2021, and an increase of $47.6 million from $192.5 million for the
first quarter 2021. Earnings per share was $2.22 for the first
quarter 2022, compared to $2.32 for the fourth quarter 2021, and
$1.90 for the first quarter 2021. The increase in net income and
earnings per share for the first quarter 2022 compared to the same
quarter last year was due to HFI loan growth and new mortgage
banking activity related to the AmeriHome acquisition.
The Company views its pre-provision net revenue1 ("PPNR") as a
key metric for assessing the Company’s earnings power, which it
defines as net revenue less non-interest expense. For the first
quarter 2022, the Company’s PPNR1 was $307.2 million, down $16.0
million from $323.2 million in the fourth quarter 2021, and up
$105.2 million from $202.0 million in the first quarter 2021. The
decrease in PPNR1 from the fourth quarter 2021 was driven by
increased compensation costs. The increase in PPNR1 from the first
quarter 2021 was driven by HFI loan growth and the AmeriHome
acquisition completed on April 7, 2021.
The Company had 3,170 full-time equivalent employees and 60
offices at March 31, 2022, compared to 3,139 employees and 58
offices at December 31, 2021, and 1,947 employees and 49 offices at
March 31, 2021. The increase in employees from March 31, 2021
primarily relates to the addition of AmeriHome employees.
1 See reconciliation of Non-GAAP Financial Measures.
Balance Sheet
HFI loans, net of deferred fees totaled $41.1 billion at March
31, 2022, an increase of $2.0 billion from $39.1 billion at
December 31, 2021, and $12.4 billion from $28.7 billion at March
31, 2021. The increase in HFI loans from the prior quarter was
driven by a $2.0 billion increase in residential real estate as
well as loan growth of $323 million in CRE non-owner occupied, and
$255 million in construction and land development loans, which were
partially offset by decreases in commercial and industrial loans of
$436 million and CRE owner occupied loans of $93 million. From
March 31, 2021, loan growth was primarily driven by residential
real estate, commercial and industrial, and CRE non-owner occupied
loans which increased $8.2 billion, $2.8 billion, and $1.2 billion,
respectively. Construction and land development loans also
increased $510 million, partially offset by a decrease in CRE owner
occupied loans of $247 million from March 31, 2021.
The Company's allowance for credit losses on HFI loans consists
of an allowance for funded HFI loans and an allowance for unfunded
loan commitments. At March 31, 2022, the allowance for loan losses
to funded HFI loans was 0.63%, compared to 0.65% at December 31,
2021, and 0.86% at March 31, 2021. The allowance for credit losses,
which includes the allowance for unfunded loan commitments, to
funded HFI loans was 0.73% at March 31, 2022, compared to 0.74% at
December 31, 2021, and 0.97% at March 31, 2021. In 2021, the
Company entered into two separate credit linked note transactions,
which effectively transfers the risk of loan losses on a reference
pool of loans to the purchasers of the notes. However, as these
note transactions are considered to be free standing credit
enhancements, the allowance for credit losses cannot be reduced by
the expected credit losses that may be mitigated by these notes.
Accordingly, the allowance for loan and credit losses ratios as of
March 31, 2022 and December 31, 2021 include an allowance of $9.5
million and $7.2 million, respectively, related to this pool of
loans. The allowance for credit losses to funded HFI loans,
adjusted to take into consideration the transfer of risk associated
with the credit linked note transactions, was 0.84% at March 31,
2022 and 0.89% at December 31, 2021.
Deposits totaled $52.2 billion at March 31, 2022, an increase of
$4.5 billion from $47.6 billion at December 31, 2021, and an
increase of $13.8 billion from $38.4 billion at March 31, 2021. By
deposit type, the increase from the prior quarter is primarily
attributable to an increase of $2.2 billion from non-interest
bearing demand deposits, $1.3 billion from interest bearing demand
deposits, and $1.3 billion from savings and money market accounts,
partially offset by a decrease of $238 million from certificates of
deposits. From March 31, 2021, deposits increased across all
deposit types, with the largest increases in non-interest bearing
demand deposits of $6.0 billion, interest-bearing demand deposits
of $4.4 billion, and savings and money market accounts of $3.3
billion. Non-interest bearing deposits were $23.5 billion at March
31, 2022, compared to $21.4 billion at December 31, 2021, and $17.5
billion at March 31, 2021.
The table below shows the Company's deposit types as a
percentage of total deposits:
Mar 31, 2022
Dec 31, 2021
Mar 31, 2021
Non-interest bearing
45.1
%
44.9
%
45.7
%
Savings and money market
35.6
36.3
39.8
Interest-bearing demand
15.8
14.5
10.1
Certificates of deposit
3.5
4.3
4.4
The Company’s ratio of HFI loans to deposits was 78.8% at March
31, 2022, compared to 82.1% at December 31, 2021, and 74.8% at
March 31, 2021.
Borrowings were $815 million at March 31, 2022, $1.5 billion at
December 31, 2021, and $5 million at March 31, 2021. The decrease
in borrowings from December 31, 2021 is due primarily to a decrease
in overnight borrowings of $675 million. The increase in borrowings
from March 31, 2021 is due primarily to the assumption of
borrowings related to the acquisition of AmeriHome and the issuance
of $470 million in credit linked notes during 2021.
Qualifying debt totaled $893 million at March 31, 2022, compared
to $896 million at December 31, 2021, and $544 million at March 31,
2021. The increase in qualifying debt from March 31, 2021 is
primarily related to the issuance of $600 million in subordinated
debt in June 2021, partially offset by $250 million in subordinated
debt redemptions during 2021.
Stockholders’ equity was $5.0 billion at March 31, 2022,
compared to $5.0 billion at December 31, 2021, and $3.7 billion at
March 31, 2021. Stockholders' equity remained consistent quarter
over quarter as net income and net proceeds from the sale of the
Company's common stock under its ATM program were offset by
dividends to shareholders and fair value losses of approximately
$250 million on the Company's fixed rate available for sale
securities, which are recorded in other comprehensive income, net
of tax. During the quarter, the Company sold 1.3 million shares of
its common stock at an average purchase price of $86.78 per share,
with aggregate net proceeds totaling $107.7 million. A cash
dividend of $0.35 per share was paid to common shareholders on
March 4, 2022, totaling $37.3 million, and a cash dividend of $0.27
per depository share was paid to preferred shareholders on March
30, 2022, totaling $3.2 million. The increase in stockholders'
equity from March 31, 2021 is primarily a function of net income,
issuance of preferred stock, and sales of common stock under the
Company's ATM program, partially offset by dividends to
shareholders and losses on available for sale securities.
At March 31, 2022, tangible common equity, net of tax1, was 6.7%
of tangible assets1 and total capital was 12.0% of risk-weighted
assets. The Company’s tangible book value per share1 was $37.13 at
March 31, 2022, up 12.4% from March 31, 2021.
Total assets increased 8.2% to $60.6 billion at March 31, 2022,
from $56.0 billion at December 31, 2021, and increased 39.6% from
$43.4 billion at March 31, 2021. The increase in total assets from
December 31, 2021 was driven by continued organic loan and deposit
growth. The increase in total assets from March 31, 2021 was also
driven by continued organic loan and deposit growth along with the
acquisition of net assets in the AmeriHome acquisition.
1 See reconciliation of Non-GAAP Financial Measures.
Asset Quality
Provision for credit losses totaled $9.0 million for the first
quarter 2022, compared $13.2 million for the fourth quarter 2021,
and a recovery of credit losses of $32.4 million for the first
quarter 2021. Net loan charge-offs in the first quarter 2022 were
$0.2 million, or approximately 0.00% of average loans (annualized),
compared to $1.4 million, or 0.02%, in the fourth quarter 2021, and
$1.4 million, or 0.02%, in the first quarter 2021.
Nonaccrual loans increased $18.4 million to $91.0 million during
the quarter and decreased $22.6 million from March 31, 2021. Loans
past due 90 days and still accruing interest were zero at March 31,
2022, December 31, 2021, and March 31, 2021. Loans past due 30-89
days and still accruing interest totaled $57.6 million at March 31,
2022, an increase from $52.5 million at December 31, 2021, and an
increase from $7.3 million at March 31, 2021.
Repossessed assets totaled $11.7 million at March 31, 2022, flat
from December 31, 2021, and an increase of $7.5 million from $4.2
million at March 31, 2021. Classified assets totaled $365.1 million
at March 31, 2022, an increase of $64.4 million from $300.7 million
at December 31, 2021, and $84.3 million from $280.9 million at
March 31, 2021.
The ratio of classified assets to Tier 1 capital plus the
allowance for credit losses, a common regulatory measure of asset
quality, was 7.4% at March 31, 2022, compared to 6.4% at December
31, 2021, and 7.5% at March 31, 2021.
1 See reconciliation of Non-GAAP Financial Measures.
Segment Highlights
The Company's reportable segments are aggregated with a focus on
products and services offered and consist of three reportable
segments:
- Commercial segment: provides commercial banking and treasury
management products and services to small and middle-market
businesses, specialized banking services to sophisticated
commercial institutions and investors within niche industries, as
well as financial services to the real estate industry.
- Consumer Related segment: offers both commercial banking
services to enterprises in consumer-related sectors and consumer
banking services, such as residential mortgage banking and
beginning on April 7, 2021 includes the financial results of
AmeriHome.
- Corporate & Other segment: consists of the Company's
investment portfolio, Corporate borrowings and other related items,
income and expense items not allocated to our other reportable
segments, and inter-segment eliminations.
Key management metrics for evaluating the performance of the
Company's Commercial and Consumer Related segments include loan and
deposit growth, asset quality, and pre-tax income.
The Commercial segment reported an HFI loan balance of $25.8
billion at March 31, 2022, an increase of $702 million during the
quarter, and an increase of $5.1 billion during the last twelve
months. Deposits for the Commercial segment totaled $30.1 billion
at March 31, 2022, a decrease of $333 million during the quarter,
and an increase of $6.0 billion during the last twelve months.
Pre-tax income for the Commercial segment was $236.8 million for
the three months ended March 31, 2022, a decrease of $1.5 million
from the three months ended December 31, 2021, and an increase of
$15.9 million from the three months ended March 31, 2021.
The Consumer Related segment reported an HFI loan balance of
$15.3 billion at March 31, 2022, an increase of $1.3 billion during
the quarter, and an increase of $7.3 billion during the last twelve
months. The Consumer Related segment also has loans held for sale,
initially acquired as part of the AmeriHome acquisition, of $4.8
billion at March 31, 2022, a decrease of $874 million during the
quarter. Deposits for the Consumer Related segment totaled $18.5
billion, an increase of $3.2 billion during the quarter, and an
increase of $5.2 billion during the last twelve months.
Pre-tax income for the Consumer Related segment was $126.9
million for the three months ended March 31, 2022, a decrease of
$8.1 million from the three months ended December 31, 2021, and an
increase of $55.4 million from the three months ended March 31,
2021.
Conference Call and Webcast
Western Alliance Bancorporation will host a conference call and
live webcast to discuss its first quarter 2022 financial results at
12:00 p.m. ET on Friday, April 22, 2022. Participants may access
the call by dialing 1-833-236-2753 and using the conference ID
8647856 or via live audio webcast using the website link
https://event.on24.com/wcc/r/3722529/285EA0451C6B4F5BCA17F23768468E57.
The webcast is also available via the Company’s website at
www.westernalliancebancorporation.com.
Participants should log in at least 15 minutes early to receive
instructions. The call will be recorded and made available for
replay after 3:00 p.m. ET April 22nd through 11:00 p.m. ET May 22nd
by dialing 1-800-585-8367, conference ID: 8647856.
Reclassifications
Certain amounts in the Consolidated Income Statements for the
prior periods have been reclassified to conform to the current
presentation. The reclassifications have no effect on net income or
stockholders’ equity as previously reported.
Use of Non-GAAP Financial Information
This press release contains both financial measures based on
GAAP and non-GAAP based financial measures, which are used where
management believes them to be helpful in understanding the
Company’s results of operations or financial position. Where
non-GAAP financial measures are used, the comparable GAAP financial
measure, as well as the reconciliation 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.
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 our
expectations with regard to our business, financial and operating
results, future economic performance and dividends. 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: the risk factors discussed in the Company’s Annual Report
on Form 10-K for the year ended December 31, 2021 and the Company's
subsequent Quarterly Reports on Form 10-Q, each as filed with the
Securities and Exchange Commission; the potential adverse effects
of unusual and infrequently occurring events such as the COVID-19
pandemic and any governmental or societal responses thereto;
changes in general economic conditions, either nationally or
locally in the areas in which we conduct or will conduct our
business; the impact on financial markets from geopolitical
conflicts such as the war between Russia and Ukraine; 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, including
expansion through acquisitions; additional regulatory requirements
resulting from our continued growth; 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.
About Western Alliance Bancorporation
With more than $60 billion in assets, Western Alliance
Bancorporation (NYSE: WAL) is one of the country’s top-performing
banking companies. The company is #2 best-performing of the 50
largest public U.S. banks in the S&P Global Market Intelligence
listing for 2021, ranks high on the Forbes “America’s Best Banks”
list year after year and was named #1 Best Emerging Regional Bank
per Bank Director’s 2022 RankingBanking study. Its primary
subsidiary, Western Alliance Bank, Member FDIC, helps business
clients realize their ambitions with teams of experienced bankers
who deliver superior service and a full spectrum of customized
loan, deposit and treasury management capabilities, including
blockchain-based offerings. Business clients also benefit from a
powerful array of specialized financial services that provide
strong expertise and tailored solutions for a wide variety of
industries and sectors. Serving clients across the country wherever
business happens, Western Alliance Bank operates individual,
full-service banking and financial services brands, including
AmeriHome Mortgage, and has offices in key markets nationwide. For
more information, visit westernalliancebank.com.
Western Alliance Bancorporation and
Subsidiaries
Summary Consolidated Financial
Data
Unaudited
Selected Balance Sheet Data:
As of March 31,
2022
2021
Change %
(in millions)
Total assets
$
60,576.1
$
43,397.0
39.6
%
Loans held for sale
4,761.6
—
—
HFI loans, net of deferred fees
41,119.1
28,711.0
43.2
Investment securities
8,276.6
7,888.8
4.9
Total deposits
52,159.5
38,393.1
35.9
Qualifying debt
893.3
543.7
64.3
Stockholders' equity
5,011.6
3,712.7
35.0
Tangible common equity, net of tax (1)
4,020.9
3,416.1
17.7
Selected Income Statement Data:
For the Three Months Ended
March 31,
2022
2021
Change %
(in millions, except per share
data)
Interest income
$
484.5
$
334.1
45.0
%
Interest expense
35.0
16.8
NM
Net interest income
449.5
317.3
41.7
Provision for (recovery of) credit
losses
9.0
(32.4
)
NM
Net interest income after provision for
credit losses
440.5
349.7
26.0
Non-interest income
106.3
19.7
NM
Non-interest expense
248.6
135.0
84.1
Income before income taxes
298.2
234.4
27.2
Income tax expense
58.1
41.9
38.7
Net income
240.1
192.5
24.7
Dividends on preferred stock
3.2
—
—
Net income available to common
stockholders
$
236.9
$
192.5
23.1
Diluted earnings per common share
$
2.22
$
1.90
16.8
(1)
See Reconciliation of Non-GAAP Financial
Measures.
NM
Changes +/- 100% are not meaningful.
Western Alliance Bancorporation and
Subsidiaries
Summary Consolidated Financial
Data
Unaudited
Common Share Data:
At or For the Three Months
Ended March 31,
2022
2021
Change %
Diluted earnings per common share
$
2.22
$
1.90
16.8
%
Book value per common share
43.56
35.89
21.4
Tangible book value per common share, net
of tax (1)
37.13
33.02
12.4
Average common shares outstanding
(in millions):
Basic
106.0
100.8
5.2
Diluted
106.6
101.4
5.1
Common shares outstanding
108.3
103.4
4.7
Selected Performance Ratios:
Return on average assets (2)
1.64
%
1.93
%
(15.0
) %
Return on average tangible common equity
(1, 2)
23.9
24.2
(1.2
)
Net interest margin (2)
3.32
3.37
(1.5
)
Efficiency ratio - tax equivalent basis
(1)
44.1
39.1
12.8
Loan to deposit ratio
78.8
74.8
5.3
Asset Quality Ratios:
Net charge-offs to average loans
outstanding (2)
0.00
%
0.02
%
NM
Nonaccrual loans to funded HFI loans
0.22
0.40
(45.0
)
Nonaccrual loans and repossessed assets to
total assets
0.17
0.27
(37.0
)
Allowance for loan losses to funded HFI
loans
0.63
0.86
(26.7
)
Allowance for loan losses to nonaccrual
HFI loans
283
218
30.1
Capital Ratios:
Mar 31, 2022
Dec 31, 2021
Mar 31, 2021
Tangible common equity (1)
6.7
%
7.3
%
7.9
%
Common Equity Tier 1 (3)
9.0
9.1
10.3
Tier 1 Leverage ratio (3)
8.0
7.8
8.8
Tier 1 Capital (3)
9.8
9.9
10.6
Total Capital (3)
12.0
12.3
12.6
(1)
See Reconciliation of Non-GAAP Financial
Measures.
(2)
Annualized on an actual/actual basis for
periods less than 12 months.
(3)
Capital ratios for March 31, 2022 are
preliminary.
NM
Changes +/- 100% are not meaningful.
Western Alliance Bancorporation and
Subsidiaries
Condensed Consolidated Income
Statements
Unaudited
Three Months Ended March
31,
2022
2021
(dollars in millions, except per
share data)
Interest income:
Loans
$
434.7
$
298.4
Investment securities
48.0
34.0
Other
1.8
1.7
Total interest income
484.5
334.1
Interest expense:
Deposits
14.1
10.8
Qualifying debt
8.4
5.9
Borrowings
12.5
0.1
Total interest expense
35.0
16.8
Net interest income
449.5
317.3
Provision for (recovery of) credit
losses
9.0
(32.4
)
Net interest income after provision for
credit losses
440.5
349.7
Non-interest income:
Net loan servicing revenue
41.1
—
Net gain on loan origination and sale
activities
36.9
—
Service charges and fees
7.0
6.7
Commercial banking related income
5.1
3.4
Income from equity investments
4.1
7.6
Gain on sales of investment securities
6.9
0.1
Gain on recovery from credit
guarantees
2.3
—
Fair value loss adjustments on assets
measured at fair value, net
(6.6
)
(1.5
)
Other
9.5
3.4
Total non-interest income
106.3
19.7
Non-interest expenses:
Salaries and employee benefits
138.3
83.7
Legal, professional, and directors'
fees
24.0
10.1
Data processing
17.6
9.9
Occupancy
12.8
8.6
Loan servicing expenses
10.8
—
Deposit costs
9.3
6.3
Insurance
7.2
4.2
Loan acquisition and origination
expenses
6.5
—
Business development and marketing
4.4
1.4
Net loss (gain) on sales and valuations of
repossessed and other assets
0.1
(0.3
)
Acquisition and restructure expenses
0.4
0.4
Other
17.2
10.7
Total non-interest expense
248.6
135.0
Income before income taxes
298.2
234.4
Income tax expense
58.1
41.9
Net income
240.1
192.5
Dividends on preferred stock
3.2
—
Net income available to common
stockholders
$
236.9
$
192.5
Earnings per common share:
Diluted shares
106.6
101.4
Diluted earnings per share
$
2.22
$
1.90
Western Alliance Bancorporation and
Subsidiaries
Five Quarter Condensed Consolidated
Income Statements
Unaudited
Three Months Ended
Mar 31, 2022
Dec 31, 2021
Sep 30, 2021
Jun 30, 2021
Mar 31, 2021
(in millions, except per share
data)
Interest income:
Loans
$
434.7
$
438.6
$
398.0
$
353.8
$
298.4
Investment securities
48.0
43.7
43.5
43.5
34.0
Other
1.8
1.0
1.3
1.2
1.7
Total interest income
484.5
483.3
442.8
398.5
334.1
Interest expense:
Deposits
14.1
12.8
12.3
11.6
10.8
Qualifying debt
8.4
9.2
10.8
7.2
5.9
Borrowings
12.5
10.7
9.3
9.2
0.1
Total interest expense
35.0
32.7
32.4
28.0
16.8
Net interest income
449.5
450.6
410.4
370.5
317.3
Provision for (recovery of) credit
losses
9.0
13.2
12.3
(14.5
)
(32.4
)
Net interest income after provision for
credit losses
440.5
437.4
398.1
385.0
349.7
Non-interest income:
Net loan servicing revenue (expense)
41.1
2.3
2.2
(20.8
)
—
Net gain on loan origination and sale
activities
36.9
73.2
121.0
132.0
—
Service charges and fees
7.0
7.1
7.1
7.4
6.7
Commercial banking related income
5.1
4.9
4.6
4.5
3.4
Income from equity investments
4.1
5.2
2.5
6.8
7.6
Gain on sales of investment securities
6.9
8.3
—
—
0.1
Gain on recovery from credit
guarantees
2.3
7.2
—
—
—
Fair value (loss) gain adjustments on
assets measured at fair value, net
(6.6
)
(0.8
)
(2.2
)
3.2
(1.5
)
Other
9.5
3.0
2.9
2.9
3.4
Total non-interest income
106.3
110.4
138.1
136.0
19.7
Non-interest expenses:
Salaries and employee benefits
138.3
120.6
133.5
128.9
83.7
Legal, professional, and directors'
fees
24.0
20.8
13.7
14.0
10.1
Data processing
17.6
17.9
15.4
15.0
9.9
Occupancy
12.8
12.4
12.4
10.4
8.6
Loan servicing expenses
10.8
15.6
15.6
22.3
—
Deposit costs
9.3
9.1
7.3
7.1
6.3
Insurance
7.2
7.1
6.2
5.5
4.2
Loan acquisition and origination
expenses
6.5
8.6
9.7
10.5
—
Business development and marketing
4.4
6.1
2.8
3.2
1.4
Loss on extinguishment of debt
—
5.9
—
—
—
Net loss (gain) on sales and valuations of
repossessed and other assets
0.1
(0.4
)
(1.3
)
(1.5
)
(0.3
)
Acquisition and restructure expenses
(recoveries)
0.4
(3.2
)
2.4
15.7
0.4
Other
17.2
17.3
16.1
13.7
10.7
Total non-interest expense
248.6
237.8
233.8
244.8
135.0
Income before income taxes
298.2
310.0
302.4
276.2
234.4
Income tax expense
58.1
64.0
65.5
52.4
41.9
Net income
240.1
246.0
236.9
223.8
192.5
Dividends on preferred stock
3.2
3.5
—
—
—
Net income available to common
stockholders
$
236.9
$
242.5
$
236.9
$
223.8
$
192.5
Earnings per common share:
Diluted shares
106.6
104.5
103.9
103.4
101.4
Diluted earnings per share
$
2.22
$
2.32
$
2.28
$
2.17
$
1.90
Western Alliance Bancorporation and
Subsidiaries
Five Quarter Condensed Consolidated
Balance Sheets
Unaudited
Mar 31, 2022
Dec 31, 2021
Sep 30, 2021
Jun 30, 2021
Mar 31, 2021
(in millions)
Assets:
Cash and due from banks
$
2,602.3
$
516.4
$
917.9
$
3,395.8
$
5,346.5
Investment securities
8,276.6
7,540.9
7,695.9
7,845.0
7,888.8
Loans held for sale
4,761.6
5,635.1
6,534.3
4,465.2
—
Loans held for investment:
Commercial and industrial
17,861.9
18,297.5
16,524.7
14,284.5
15,070.7
Commercial real estate - non-owner
occupied
6,849.6
6,526.4
5,843.7
5,695.6
5,681.4
Commercial real estate - owner
occupied
1,805.4
1,898.1
1,996.6
2,028.1
2,052.0
Construction and land development
3,277.7
3,022.7
2,943.3
2,856.9
2,767.9
Residential real estate
11,269.7
9,281.7
7,452.8
5,120.7
3,109.1
Consumer
54.8
49.0
40.8
40.6
29.9
Loans, net of deferred fees
41,119.1
39,075.4
34,801.9
30,026.4
28,711.0
Allowance for loan losses
(257.6
)
(252.5
)
(246.9
)
(232.9
)
(247.1
)
Loans, net of deferred fees and
allowance
40,861.5
38,822.9
34,555.0
29,793.5
28,463.9
Mortgage servicing rights
950.3
698.0
604.8
726.2
—
Premises and equipment, net
196.3
181.9
161.2
150.2
138.4
Operating lease right-of-use asset
141.8
133.0
106.0
94.9
77.0
Other assets acquired through foreclosure,
net
11.7
11.7
11.5
3.9
4.2
Bank owned life insurance
178.9
180.2
179.2
178.2
177.3
Goodwill and other intangibles, net
698.2
634.8
608.4
610.7
298.0
Other assets
1,896.9
1,627.7
1,400.9
1,805.4
1,002.9
Total assets
$
60,576.1
$
55,982.6
$
52,775.1
$
49,069.0
$
43,397.0
Liabilities and Stockholders'
Equity:
Liabilities:
Deposits
Non-interest bearing demand deposits
$
23,520.4
$
21,353.4
$
21,058.2
$
20,105.6
$
17,542.8
Interest bearing:
Demand
8,268.2
6,924.0
4,954.3
4,187.7
3,893.4
Savings and money market
18,552.7
17,278.6
17,440.1
15,810.3
15,276.0
Certificates of deposit
1,818.2
2,056.0
1,830.0
1,817.4
1,680.9
Total deposits
52,159.5
47,612.0
45,282.6
41,921.0
38,393.1
Customer repurchase agreements
18.0
16.6
16.1
20.2
15.9
Total customer funds
52,177.5
47,628.6
45,298.7
41,941.2
38,409.0
Borrowings
815.3
1,485.3
987.4
595.2
5.0
Qualifying debt
893.3
895.8
1,064.9
1,140.0
543.7
Operating lease liability
154.9
142.8
115.0
102.4
84.6
Accrued interest payable and other
liabilities
1,523.5
867.5
795.1
1,255.7
642.0
Total liabilities
55,564.5
51,020.0
48,261.1
45,034.5
39,684.3
Stockholders' Equity:
Preferred stock
294.5
294.5
294.5
—
—
Common stock and additional paid-in
capital
1,979.6
1,879.4
1,609.9
1,603.4
1,524.2
Retained earnings
2,972.6
2,773.0
2,567.0
2,366.6
2,168.6
Accumulated other comprehensive (loss)
income
(235.1
)
15.7
42.6
64.5
19.9
Total stockholders' equity
5,011.6
4,962.6
4,514.0
4,034.5
3,712.7
Total liabilities and stockholders'
equity
$
60,576.1
$
55,982.6
$
52,775.1
$
49,069.0
$
43,397.0
Western Alliance Bancorporation and
Subsidiaries
Changes in the Allowance For Credit
Losses on Loans
Unaudited
Three Months Ended
Mar 31, 2022
Dec 31, 2021
Sep 30, 2021
Jun 30, 2021
Mar 31, 2021
(in millions)
Allowance for loan losses
Balance, beginning of period
$
252.5
$
246.9
$
232.9
$
247.1
$
278.9
Provision for (recovery of) credit losses
(1)
5.3
7.0
17.0
(14.1
)
(30.4
)
Recoveries of loans previously
charged-off:
Commercial and industrial
2.4
1.8
0.1
0.4
0.5
Commercial real estate - non-owner
occupied
—
0.3
—
1.7
0.2
Commercial real estate - owner
occupied
—
—
0.1
—
—
Construction and land development
—
—
0.1
—
—
Residential real estate
—
0.4
—
0.1
—
Consumer
—
—
—
—
—
Total recoveries
2.4
2.5
0.3
2.2
0.7
Loans charged-off:
Commercial and industrial
2.6
3.8
3.3
2.3
0.1
Commercial real estate - non-owner
occupied
—
—
—
—
2.0
Commercial real estate - owner
occupied
—
—
—
—
—
Construction and land development
—
—
—
—
—
Residential real estate
—
0.1
—
—
—
Consumer
—
—
—
—
—
Total loans charged-off
2.6
3.9
3.3
2.3
2.1
Net loan charge-offs
0.2
1.4
3.0
0.1
1.4
Balance, end of period
$
257.6
$
252.5
$
246.9
$
232.9
$
247.1
Allowance for unfunded loan
commitments
Balance, beginning of period
$
37.6
$
32.1
$
31.3
$
32.6
$
37.0
Provision for (recovery of) credit losses
(1)
5.7
5.5
0.8
(1.3
)
(4.4
)
Balance, end of period (2)
$
43.3
$
37.6
$
32.1
$
31.3
$
32.6
Components of the allowance for credit
losses on loans
Allowance for loan losses
$
257.6
$
252.5
$
246.9
$
232.9
$
247.1
Allowance for unfunded loan
commitments
43.3
37.6
32.1
31.3
32.6
Total allowance for credit losses on
loans
$
300.9
$
290.1
$
279.0
$
264.2
$
279.7
Net charge-offs to average loans -
annualized
0.00
%
0.02
%
0.04
%
0.00
%
0.02
%
Allowance for loan losses to funded HFI
loans (3)
0.63
%
0.65
%
0.71
%
0.78
%
0.86
%
Allowance for credit losses to funded HFI
loans (3)
0.73
0.74
0.80
0.88
0.97
Allowance for loan losses to nonaccrual
HFI loans
283
348
316
242
218
Allowance for credit losses to nonaccrual
HFI loans
331
400
357
274
246
(1)
The above tables reflect the provision for
credit losses on funded and unfunded loans. Recovery of credit
losses on investment securities totaled $2.0 million, resulting in
an ending allowance for credit losses on investment securities of
$3.2 million as of March 31, 2022.
(2)
The allowance for unfunded loan
commitments is included as part of accrued interest payable and
other liabilities on the balance sheet.
(3)
Ratio includes an allowance for credit
losses of $9.5 million as of March 31, 2022 related to a $5.4
billion pool of loans covered under two separate credit linked note
transactions.
Western Alliance Bancorporation and
Subsidiaries
Asset Quality Metrics
Unaudited
Three Months Ended
Mar 31, 2022
Dec 31, 2021
Sep 30, 2021
Jun 30, 2021
Mar 31, 2021
(in millions)
Nonaccrual loans
$
91.0
$
72.6
$
78.1
$
96.3
$
113.6
Nonaccrual loans to funded HFI loans
0.22
%
0.19
%
0.22
%
0.32
%
0.40
%
Repossessed assets
$
11.7
$
11.7
$
11.5
$
3.9
$
4.2
Nonaccrual loans and repossessed assets to
total assets
0.17
%
0.15
%
0.17
%
0.20
%
0.27
%
Loans past due 90 days, still accruing
$
—
$
—
$
—
$
—
$
—
Loans past due 90 days and still accruing
to funded HFI loans
—
%
—
%
—
%
—
%
—
%
Loans past due 30 to 89 days, still
accruing
$
57.6
$
52.5
$
23.6
$
9.8
$
7.3
Loans past due 30 to 89 days, still
accruing to funded HFI loans
0.14
%
0.13
%
0.07
%
0.03
%
0.03
%
Special mention loans
$
349.9
$
331.1
$
364.5
$
404.8
$
474.2
Special mention loans to funded HFI
loans
0.85
%
0.85
%
1.05
%
1.35
%
1.65
%
Classified loans on accrual
$
252.8
$
216.4
$
175.3
$
138.2
$
163.1
Classified loans on accrual to funded HFI
loans
0.61
%
0.55
%
0.50
%
0.46
%
0.57
%
Classified assets
$
365.1
$
300.7
$
264.9
$
238.5
$
280.9
Classified assets to total assets
0.60
%
0.54
%
0.50
%
0.49
%
0.65
%
Western Alliance Bancorporation and
Subsidiaries
Analysis of Average Balances, Yields
and Rates
Unaudited
Three Months Ended
March 31, 2022
December 31, 2021
Average Balance
Interest
Average Yield / Cost
Average Balance
Interest
Average Yield / Cost
($ in millions)
($ in millions)
Interest earning assets
Loans held for sale
$
6,521.5
$
50.4
3.14
%
$
9,158.7
$
70.3
3.04
%
Loans held for investment:
Commercial and industrial
17,487.0
165.9
3.91
17,087.5
169.5
4.01
CRE - non-owner occupied
6,689.6
73.2
4.44
6,208.5
70.0
4.48
CRE - owner occupied
1,859.1
22.8
5.07
1,970.9
24.2
4.96
Construction and land development
3,090.0
41.7
5.47
3,016.0
43.9
5.78
Residential real estate
10,384.6
80.2
3.13
8,282.3
60.3
2.89
Consumer
51.6
0.5
3.95
43.5
0.4
3.85
Total HFI loans (1), (2), (3)
39,561.9
384.3
3.98
36,608.7
368.3
4.03
Securities:
Securities - taxable
5,534.0
29.9
2.19
5,442.7
25.6
1.86
Securities - tax-exempt
2,136.2
18.1
4.29
2,175.3
18.1
4.12
Total securities (1)
7,670.2
48.0
2.77
7,618.0
43.7
2.51
Cash and other
2,057.7
1.8
0.36
1,274.6
1.0
0.31
Total interest earning assets
55,811.3
484.5
3.58
54,660.0
483.3
3.57
Non-interest earning assets
Cash and due from banks
244.8
252.6
Allowance for credit losses
(261.9
)
(255.9
)
Bank owned life insurance
180.5
179.5
Other assets
3,298.8
2,766.8
Total assets
$
59,273.5
$
57,603.0
Interest-bearing liabilities
Interest-bearing deposits:
Interest-bearing transaction accounts
$
7,743.1
$
2.7
0.14
%
$
5,918.6
$
1.7
0.11
%
Savings and money market
18,131.0
9.6
0.21
17,215.2
9.1
0.21
Certificates of deposit
1,920.2
1.8
0.38
2,073.6
2.0
0.38
Total interest-bearing deposits
27,794.3
14.1
0.21
25,207.4
12.8
0.20
Short-term borrowings
1,149.5
1.7
0.62
2,815.5
2.4
0.35
Long-term debt
769.9
10.8
5.67
564.8
8.3
5.81
Qualifying debt
896.0
8.4
3.81
978.2
9.2
3.72
Total interest-bearing
liabilities
30,609.7
35.0
0.46
29,565.9
32.7
0.44
Interest cost of funding earning
assets
0.26
0.24
Non-interest-bearing
liabilities
Non-interest-bearing demand deposits
22,580.0
22,487.0
Other liabilities
1,094.9
912.5
Stockholders’ equity
4,988.9
4,637.6
Total liabilities and stockholders'
equity
$
59,273.5
$
57,603.0
Net interest income and margin (4)
$
449.5
3.32
%
$
450.6
3.33
%
(1)
Yields on loans and securities have been
adjusted to a tax equivalent basis. The tax equivalent adjustment
was $8.0 million and $8.4 million for the three months ended March
31, 2022 and December 31, 2021, respectively.
(2)
Included in the yield computation are net
loan fees of $29.1 million and $35.8 million for the three months
ended March 31, 2022 and December 31, 2021, respectively.
(3)
Includes non-accrual loans.
(4)
Net interest margin is computed by
dividing net interest income by total average earning assets,
annualized on an actual/actual basis.
Western Alliance Bancorporation and
Subsidiaries
Analysis of Average Balances, Yields
and Rates
Unaudited
Three Months Ended
March 31, 2022
March 31, 2021
Average Balance
Interest
Average Yield / Cost
Average Balance
Interest
Average Yield / Cost
($ in millions)
($ in millions)
Interest earning assets
Loans held for sale
$
6,521.5
$
50.4
3.14
%
$
—
$
—
—
%
Loans held for investment:
Commercial and industrial
17,487.0
165.9
3.91
13,951.6
151.0
4.48
CRE - non-owner-occupied
6,689.6
73.2
4.44
5,649.7
65.1
4.68
CRE - owner-occupied
1,859.1
22.8
5.07
2,094.2
24.4
4.83
Construction and land development
3,090.0
41.7
5.47
2,484.8
35.6
5.81
Residential real estate
10,384.6
80.2
3.13
2,507.7
21.9
3.55
Consumer
51.6
0.5
3.95
34.5
0.4
5.39
Total HFI loans (1), (2), (3)
39,561.9
384.3
3.98
26,722.5
298.4
4.59
Securities:
Securities - taxable
5,534.0
29.9
2.19
4,531.4
18.5
1.66
Securities - tax-exempt
2,136.2
18.1
4.29
1,980.9
15.5
3.99
Total securities (1)
7,670.2
48.0
2.77
6,512.3
34.0
2.37
Other
2,057.7
1.8
0.36
5,864.0
1.7
0.12
Total interest earning assets
55,811.3
484.5
3.58
39,098.8
334.1
3.55
Non-interest earning assets
Cash and due from banks
244.8
166.1
Allowance for credit losses
(261.9
)
(289.1
)
Bank owned life insurance
180.5
176.6
Other assets
3,298.8
1,271.2
Total assets
$
59,273.5
$
40,423.6
Interest-bearing liabilities
Interest-bearing deposits:
Interest-bearing transaction accounts
$
7,743.1
$
2.7
0.14
%
$
3,905.4
$
1.3
0.13
%
Savings and money market accounts
18,131.0
9.6
0.21
13,994.4
7.1
0.21
Certificates of deposit
1,920.2
1.8
0.38
1,681.1
2.4
0.59
Total interest-bearing deposits
27,794.3
14.1
0.21
19,580.9
10.8
0.22
Short-term borrowings
1,149.5
1.7
0.62
24.8
0.1
1.13
Long-term debt
769.9
10.8
5.67
—
—
—
Qualifying debt
896.0
8.4
3.81
547.2
5.9
4.39
Total interest-bearing
liabilities
30,609.7
35.0
0.46
20,152.9
16.8
0.34
Interest cost of funding earning
assets
0.26
0.18
Non-interest-bearing
liabilities
Non-interest-bearing demand deposits
22,580.0
15,972.6
Other liabilities
1,094.9
772.3
Stockholders’ equity
4,988.9
3,525.8
Total liabilities and stockholders'
equity
$
59,273.5
$
40,423.6
Net interest income and margin (4)
$
449.5
3.32
%
$
317.3
3.37
%
(1)
Yields on loans and securities have been
adjusted to a tax equivalent basis. The tax equivalent adjustment
was $8.0 million and $8.0 million for the three months ended March
31, 2022 and 2021, respectively.
(2)
Included in the yield computation are net
loan fees of $29.1 million and $32.9 million for the three months
ended March 31, 2022 and 2021, respectively.
(3)
Includes non-accrual loans.
(4)
Net interest margin is computed by
dividing net interest income by total average earning assets,
annualized on an actual/actual basis.
Western Alliance Bancorporation and
Subsidiaries
Operating Segment Results
Unaudited
Balance Sheet:
Consolidated Company
Commercial
Consumer Related
Corporate & Other
At March 31, 2022:
(dollars in millions)
Assets:
Cash, cash equivalents, and investment
securities
$
10,878.9
$
15.6
$
97.0
$
10,766.3
Loans held for sale
4,761.6
—
4,761.6
—
Loans, net of deferred fees and costs
41,119.1
25,794.8
15,324.3
—
Less: allowance for credit losses
(257.6
)
(221.3
)
(36.3
)
—
Total loans
40,861.5
25,573.5
15,288.0
—
Other assets acquired through foreclosure,
net
11.7
11.7
—
—
Goodwill and other intangible assets,
net
698.2
294.3
403.9
—
Other assets
3,364.2
253.2
1,594.8
1,516.2
Total assets
$
60,576.1
$
26,148.3
$
22,145.3
$
12,282.5
Liabilities:
Deposits
$
52,159.5
$
30,133.6
$
18,527.6
$
3,498.3
Borrowings and qualifying debt
1,726.6
18.0
369.8
1,338.8
Other liabilities
1,678.4
268.1
170.3
1,240.0
Total liabilities
55,564.5
30,419.7
19,067.7
6,077.1
Allocated equity:
5,011.6
2,661.8
1,752.1
597.7
Total liabilities and stockholders'
equity
$
60,576.1
$
33,081.5
$
20,819.8
$
6,674.8
Excess funds provided (used)
—
6,933.2
(1,325.5
)
(5,607.7
)
No. of offices
60
50
8
2
No. of full-time equivalent employees
3,170
606
1,131
1,433
Income Statement:
Three Months Ended March 31,
2022:
(in millions)
Net interest income
$
449.5
$
334.9
$
183.2
$
(68.6
)
Provision for (recovery of) credit
losses
9.0
0.6
10.5
(2.1
)
Net interest income (expense) after
provision for credit losses
440.5
334.3
172.7
(66.5
)
Non-interest income
106.3
16.9
79.2
10.2
Non-interest expense
248.6
114.4
125.0
9.2
Income (loss) before income taxes
298.2
236.8
126.9
(65.5
)
Income tax expense (benefit)
58.1
56.2
30.4
(28.5
)
Net income (loss)
$
240.1
$
180.6
$
96.5
$
(37.0
)
Western Alliance Bancorporation and
Subsidiaries
Operating Segment Results
Unaudited
Balance Sheet:
Consolidated Company
Commercial
Consumer Related
Corporate
At December 31, 2021:
(dollars in millions)
Assets:
Cash, cash equivalents, and investment
securities
$
8,057.3
$
12.9
$
82.4
$
7,962.0
Loans held for sale
5,635.1
—
5,635.1
—
Loans, net of deferred fees and costs
39,075.4
25,092.4
13,983.0
—
Less: allowance for credit losses
(252.5
)
(226.0
)
(26.5
)
—
Total loans
38,822.9
24,866.4
13,956.5
—
Other assets acquired through foreclosure,
net
11.7
11.7
—
—
Goodwill and other intangible assets,
net
634.8
294.7
340.1
—
Other assets
2,820.8
253.8
1,278.1
1,288.9
Total assets
$
55,982.6
$
25,439.5
$
21,292.2
$
9,250.9
Liabilities:
Deposits
$
47,612.0
$
30,466.8
$
15,362.9
$
1,782.3
Borrowings and qualifying debt
2,381.1
—
353.2
2,027.9
Other liabilities
1,026.9
233.4
138.2
655.3
Total liabilities
51,020.0
30,700.2
15,854.3
4,465.5
Allocated equity:
4,962.6
2,588.0
1,596.2
778.4
Total liabilities and stockholders'
equity
$
55,982.6
$
33,288.2
$
17,450.5
$
5,243.9
Excess funds provided (used)
—
7,848.7
(3,841.7
)
(4,007.0
)
No. of offices
58
50
7
1
No. of full-time equivalent employees
3,139
628
1,173
1,338
Income Statement:
Three Months Ended March 31,
2021:
(in millions)
Net interest income
$
317.3
$
263.7
$
107.9
$
(54.3
)
Provision for (recovery of) credit
losses
(32.4
)
(36.3
)
1.7
2.2
Net interest income (expense) after
provision for credit losses
349.7
300.0
106.2
(56.5
)
Non-interest income
19.7
19.2
0.5
—
Non-interest expense
135.0
98.3
35.2
1.5
Income (loss) before income taxes
234.4
220.9
71.5
(58.0
)
Income tax expense (benefit)
41.9
52.7
17.5
(28.3
)
Net income (loss)
$
192.5
$
168.2
$
54.0
$
(29.7
)
Western Alliance Bancorporation and
Subsidiaries
Reconciliation of Non-GAAP Financial
Measures
Unaudited
Pre-Provision Net Revenue by
Quarter:
Three Months Ended
3/31/2022
12/31/2021
9/30/2021
6/30/2021
3/31/2021
(in millions)
Net interest income
$
449.5
$
450.6
$
410.4
$
370.5
$
317.3
Total non-interest income
106.3
110.4
138.1
136.0
19.7
Net revenue
$
555.8
$
561.0
$
548.5
$
506.5
$
337.0
Total non-interest expense
248.6
237.8
233.8
244.8
135.0
Pre-provision net revenue (1)
$
307.2
$
323.2
$
314.7
$
261.7
$
202.0
Less:
Provision for (recovery of) credit
losses
9.0
13.2
12.3
(14.5
)
(32.4
)
Income tax expense
58.1
64.0
65.5
52.4
41.9
Net income
$
240.1
$
246.0
$
236.9
$
223.8
$
192.5
Efficiency Ratio by Quarter:
Total non-interest expense
$
248.6
$
237.8
$
233.8
$
244.8
$
135.0
Divided by:
Total net interest income
449.5
450.6
410.4
370.5
317.3
Plus:
Tax equivalent interest adjustment
8.0
8.4
8.5
8.5
8.0
Total non-interest income
106.3
110.4
138.1
136.0
19.7
$
563.8
$
569.4
$
557.0
$
515.0
$
345.0
Efficiency ratio - tax equivalent basis
(2)
44.1
%
41.8
%
42.0
%
47.5
%
39.1
%
Tangible Common Equity:
3/31/2022
12/31/2021
9/30/2021
6/30/2021
3/31/2021
(dollars and shares in
millions)
Total stockholders' equity
$
5,011.6
$
4,962.6
$
4,514.0
$
4,034.5
$
3,712.7
Less:
Goodwill and intangible assets
698.2
634.8
608.4
610.7
298.0
Preferred stock
294.5
294.5
294.5
—
—
Total tangible common equity
4,018.9
4,033.3
3,611.1
3,423.8
3,414.7
Plus: deferred tax - attributed to
intangible assets
2.0
1.9
1.8
1.8
1.4
Total tangible common equity, net of
tax
$
4,020.9
$
4,035.2
$
3,612.9
$
3,425.6
$
3,416.1
Total assets
$
60,576.1
$
55,982.6
$
52,775.1
$
49,069.0
$
43,397.0
Less: goodwill and intangible assets,
net
698.2
634.8
608.4
610.7
298.0
Tangible assets
59,877.9
55,347.8
52,166.7
48,458.3
43,099.0
Plus: deferred tax - attributed to
intangible assets
2.0
1.9
1.8
1.8
1.4
Total tangible assets, net of
tax
$
59,879.9
$
55,349.7
$
52,168.5
$
48,460.1
$
43,100.4
Tangible common equity ratio (3)
6.7
%
7.3
%
6.9
%
7.1
%
7.9
%
Common shares outstanding
108.3
106.6
104.2
104.2
103.4
Tangible book value per share, net of tax
(3)
$
37.13
$
37.84
$
34.67
$
32.86
$
33.02
Non-GAAP Financial Measures
Footnotes
(1)
We believe this non-GAAP measurement is a
key indicator of the earnings power of the Company.
(2)
We believe this non-GAAP ratio provides a
useful metric to measure the efficiency of the Company.
(3)
We believe this non-GAAP metric provides
an important metric with which to analyze and evaluate financial
condition and capital strength. In addition, we believe that use of
tangible equity and tangible assets improves the comparability to
other institutions that have not engaged in acquisitions that
resulted in recorded goodwill and other intangibles.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220420006255/en/
Western Alliance Bancorporation Dale Gibbons, 602-952-5476
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