GICS Sector : Financial Services
Western Alliance Bancorporation operates as the bank holding company for Western Alliance Bank that provides various banking products and related services primarily in Arizona, California, and Nevada.It operates in Commercial, Consumer Related, and Corporate & Other segments.The company offers deposit products, including checking, savings, and money market accounts, as well as fixed-rate and fixed maturity certificates of deposit accounts; and treasury management and residential mortgage products and services.
Western Alliance Bancorporation reported record quarterly financial results for Q4 2025, with net interest income of $766 million, net revenue of $981 million, and pre-provision net revenue of $429 million. EPS for the quarter was $2.59, beating estimates of $2.4, and up 33% from the prior year. For the full year 2025, the company generated net interest income of $2.9 billion, net revenue of $3.5 billion, and pre-provision net revenue of $1.4 billion, with EPS of $8.73. The strong financial performance was driven by diversified HFI loan growth of $5 billion, or 9%, across regional banking and specialized C&I verticals, and deposits increased $10.8 billion, or 16%.
Publication Date: Feb -09
The company's loan growth was a key driver of its financial performance, with a 9% increase in HFI loans across regional banking and specialized C&I verticals. Deposits also increased by $10.8 billion, or 16%, with a significant portion coming from lower-cost deposit channels such as HOA, Juris Banking, digital assets, trust company, and business escrow services. Management expects loan growth of $6 billion and deposit growth of $8 billion in 2026, with net interest income growth of 11% to 14%.
The company expects to maintain a stable NIM, with a slight upward trend, despite two rate cuts embedded in its plan. WAL's combined business lines, including lot banking, hotel financing, and resort financing, are yielding well, with the ability to bring in volume based on current pricing. The company's Interbank Trading (IBT) business gets a premium, resulting in a larger discount on funding costs. Management is confident about meeting its 2026 guidance, with a focus on "bigger and better" opportunities and a priority on organic growth.
Western Alliance Bancorporation's current P/TBV ratio is 1.34, and its Dividend Yield is 1.65%. Analysts estimate next year's revenue growth at 8.7%. With a strong track record of EPS growth, the company's valuation multiples will be closely watched. The current ROE of 13.33% is a positive indicator of the company's profitability.
The company's asset quality remains stable, with improvements in several areas. Classified loans to Tier 1 capital plus ACL stand at 11.7%, comparing favorably to the peer group. WAL's ACL ratio is expected to be in the low 80s by the end of 2026, driven by C&I loan growth and NCO replenishment. Management expects net charge-offs to be between 25 and 35 basis points, with a guided range of 20 basis points, but expects normalization in the back half.
Western Alliance Bancorporation to Host 2026 Investor Day on May 12 in New York City
Feb -20
Western Alliance Bank Supports OnQ With $7.5 Million Asset-Based Line of Credit
Feb -20
Western Alliance Bank Promotes Craig Lee Huntington to Head of Market-Leading Association Banking Group
Feb -19
Three Fast-Moving Regional Banks Help Drive This ETF Breakout
Feb -11
Peachtree Group and Western Alliance Bank Announce $50 Million Warehouse Facility to Support Equipment Finance Division's Growth
Feb -09
Western Alliance Bancorporation $WAL Stock Holdings Lifted by New York State Common Retirement Fund
Feb -05
Western Alliance Bank Expands Note Finance Team in New York With Addition of Market Manager Ian Hawk
Feb -02
Western Alliance Bancorporation (WAL) Q4 2025 Earnings Call Transcript
Jan -27
Western Alliance Bancorporation's 10% commercial growth is driven by increasing demand for commercial loans, expansion into new markets, and strategic partnerships. Additionally, the bank's focus on technology and digital transformation has improved operational efficiency, allowing for better customer service and increased revenue. Furthermore, a strong economy and low unemployment rates have contributed to the growth, as businesses are more likely to borrow and invest in their operations.
Western Alliance Bancorporation's 12% growth in Consumer Related segment is driven by increasing demand for consumer loans, expansion of digital banking channels, and strategic partnerships with fintech companies. Additionally, the company's focus on customer experience, competitive pricing, and targeted marketing efforts have contributed to the growth.
Western Alliance Bancorporation's Corporate & Other Segment growth of 9% is driven by increasing mortgage banking revenue, growth in treasury management services, and expansion of its insurance business. Additionally, the segment benefits from the company's strategic investments in digital transformation, cost savings initiatives, and a favorable interest rate environment.
Western Alliance Bancorporation offers a range of commercial loans to help businesses achieve their goals, including term loans, lines of credit, and construction loans.
Western Alliance's treasury management services help businesses manage their cash flow, mitigate risk, and optimize their financial performance.
Western Alliance offers a range of deposit services, including checking and savings accounts, CDs, and IRAs, to help individuals and businesses manage their finances.
Western Alliance's mortgage banking services provide financing solutions for residential and commercial properties, including construction loans and permanent financing.
Western Alliance's wealth management services provide investment and financial planning solutions to help individuals and families achieve their financial goals.
Western Alliance's capital markets services provide access to debt and equity markets, helping businesses raise capital and achieve their financial goals.
The threat of substitutes for Western Alliance Bancorporation is moderate, as customers have some alternatives for banking services, but the company's strong brand and customer loyalty mitigate this threat.
The bargaining power of customers is low, as Western Alliance Bancorporation has a diverse customer base and is not heavily dependent on a few large customers.
The bargaining power of suppliers is low, as Western Alliance Bancorporation has a strong negotiating position with its suppliers due to its large size and scale.
The threat of new entrants is low, as the banking industry has significant barriers to entry, including regulatory hurdles and high capital requirements.
The intensity of rivalry is high, as Western Alliance Bancorporation operates in a highly competitive banking industry with many established players.
| Value | |
|---|---|
| Debt Weight | 70.79% |
| Debt Cost | 8.62% |
| Equity Weight | 29.21% |
| Equity Cost | 11.24% |
| WACC | 9.39% |
| Leverage | 242.32% |
Value: 5.9
Growth: 4.2
Quality: 7.1
Yield: 9.0
Momentum: 4.0
Volatility: 6.7
1-Year Total Return ->
Value: 6.1
Growth: 4.6
Quality: 5.8
Yield: 8.0
Momentum: 6.0
Volatility: 6.3
1-Year Total Return ->
Value: 5.3
Growth: 4.8
Quality: 4.1
Yield: 8.0
Momentum: 5.0
Volatility: 7.0
1-Year Total Return ->
Value: 5.6
Growth: 4.0
Quality: 6.9
Yield: 6.0
Momentum: 2.5
Volatility: 9.0
1-Year Total Return ->
Value: 3.9
Growth: 6.9
Quality: 5.6
Yield: 6.0
Momentum: 3.5
Volatility: 8.0
1-Year Total Return ->
Value: 7.5
Growth: 5.7
Quality: 7.4
Yield: 4.0
Momentum: 3.5
Volatility: 4.0
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