PacWest The Bancorp., a regional bank teetering after the collapse of three rival lenders, is weighing a range of strategic options, including a sale, according to people familiar with the matter.
The Beverly Hills-based bank is working with a financial adviser and is also considering a breakup or capital increase, said the people, who asked not to be identified because the matter is not public. While it is open to a sale, the company has not yet begun a formal auction process, the people said.
An outright sale was blocked because there weren’t many potential buyers interested in the entire bank, which consists of a community lender called Pacific Western Bank and some commercial and consumer lending businesses, it said. of people. A potential buyer would also have to book a big loss on some of its loans, the people said.
A PacWest representative declined to comment.
PacWest fell 44% at 4:52 pm in late New York trading. Shares fell 28% on Tuesday as investors pulled back from regional bank stocks following JPMorgan Chase & Co. on Monday for the failed First Republic Bank. PacWest, which has lost about 85% of its value since the start of March, has a market value of about $772 million.
The bank said when Earnings reporting last month that deposits recovered after a rush of withdrawals in March prompted concerns about its health and forced it to shore up liquidity. It’s the bank Exploring the sale of the financial business to its lender to free up capital and reduce its balance sheet.
PacWest has about 70 branches, primarily in California, as well as about $44 billion in assets, ACCORDING on its website.