PacWest Bancorp, the latest regional bank to come under stress, said Thursday that it’s seeking to raise money through asset sales and new investments after its shares plunged.
The Los Angeles-based bank saw its stock drop 38 percent in premarket trading after Bloomberg News reported it was weighing a sale. PacWest’s stock fell 85 percent since the bank failures in early March as investors feared it could be the latest bank to collapse.
PacWest said that, unlike the recently shuttered First Republic Bank, it has not “experienced out-of-the-ordinary deposit flows.” The lender said that its deposits actually increased since March 31, and it has enough cash to cover uninsured deposits.
PacWest said that it plans to sell a $2.7 billion loan portfolio and has “been approached by several potential partners and investors.”
“The company will continue to evaluate all options to maximize shareholder value,” PacWest said in a statement.
More from The Hill: First Republic Bank fails, taken over by JPMorgan Chase
First Republic Bank, a San Francisco-based regional lender, lost around $100 billion in deposits after the lightning-fast bank run on Silicon Valley Bank. Federal regulators seized the bank on Monday and oversaw its sale to JPMorgan Chase.
PacWest’s situation poses a key test for the banking system. Federal regulators believed they quelled future bank runs after they protected all uninsured deposits at the failed Silicon Valley Bank and Signature Bank.
Federal Reserve Chairman Jerome Powell said Wednesday that First Republic Bank was the final domino to fall in the banking crisis. But regional bank stocks plummeted after his press conference.
“There were three large banks, really from the very beginning, that were at the heart of the stress that we saw in early March — the severe period of stress. Those have now all been resolved, and all the depositors have been protected,” Powell told reporters.