Banks
Western Alliance and Wintrust lift profits as loan books grow
Both regional lenders reported higher third-quarter earnings, and Western Alliance's problem loans eased.
HedgeWeekly News Desk ·
Western Alliance Bancorporation earned $277.2 million, or $2.45 a diluted share, in the third quarter, up 6.4% from a year earlier and ahead of the $2.36 a share it made in the second quarter. Net interest income rose 7.6% year on year to $807.6 million, and the net interest margin widened to 3.57% from 3.53%.
Credit trends improved at the lender. Annualized net charge-offs fell to 0.30% of loans from 0.37% in the second quarter, and nonaccrual loans dropped to 0.79% of funded loans from 0.92%. Loans held for investment grew 1% from June to $61.5 billion while deposits were flat at $81.8 billion. The bank bought back $92.1 million of stock, and its common equity tier 1 ratio slipped to 10.9% from 11.0%.
Wintrust Financial reported net income of $239.1 million, or $3.37 a share, up from $233.7 million in the second quarter and its seventh straight quarterly record. Loans and deposits each grew at an 8% annualized pace, to $56.8 billion and $62.4 billion, and net interest income rose to $621.6 million, although the margin narrowed by 1 basis point to 3.49%.
Wintrust's net charge-offs rose to $21.0 million, or 15 basis points annualized, from 10 basis points in the prior quarter, while non-performing loans edged down to 0.31% of total loans.