Overview

• US regional bank's Q2 net income rose 13% yr/yr, EPS up 14%

• Net interest income climbed 14% yr/yr, driven by higher average earning assets

• Deposits fell 1% from Q1 as company pursued deposit optimization strategy

Outlook

• Company did not provide specific guidance for the current or future periods

Result Drivers

• LOAN GROWTH - Q2 results were driven by $1.8 bln in HFI loan growth, mainly from commercial and industrial lending

• HIGHER EARNING ASSETS - Net interest income rose 4% from prior qtr, primarily due to a $2.7 bln increase in average earning assets

• DEPOSIT OPTIMIZATION - Deposit decline reflected strategy to reduce higher-cost balances

Company press release: ID:nBw2dBnjva

Key Details

Metric	Beat/Miss	Actual	Consensus Estimate
Q2 Net Income		$268.8 mln
Q2 Net Interest Income		$796.90 mln
Q2 Credit Loss Provision		$80.40 mln

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 11 "strong buy" or "buy", 4 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the banks peer group is "buy"

• Wall Street's median 12-month price target for Western Alliance Bancorp is $90.50, about 11.8% above its July 20 closing price of $80.97

• The stock recently traded at 8 times the next 12-month earnings vs. a P/E of 7 three months ago

Reuters Recommended Reads

• July 20 - Wintrust Q2 net interest income rises on growth in average earning assets

• July 21 - KeyCorp quarterly profit rises on interest income strength

• July 20 - ServisFirst Bancshares Q2 EPS rises 40% on loan growth, higher net interest margin

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