NY.- A group of regional banks tried to convince the public on Thursday of their financial strength, even as their share prices plummeted and investors are placing bets on which might be next to fall.
That tumult raised questions about the future of those lending institutions, suggesting a new phase of the crisis that began two months ago with the collapse of Silicon Valley Bank and Signature Bank, punctuated by the seizure and sale of First Republic Bank.
PacWest and Western Alliance are in the eye of the storm, despite claims by these institutions that their finances are sound.
PacWest shares lost 50 percent of their value, while Western Alliance fell 38 percent on Thursday.
Other midsize banks including Zions and Comerica also posted double-digit declines.
Unlike banks that have failed after depositors rushed to withdraw their money, lending institutions currently under pressure have reported a relatively stable deposit base and do not have much risky credit.
They are also much smaller than Silicon Valley Bank and First Republic, which each had $200 trillion in assets when they collapsed.
PacWest, which is headquartered in Los Angeles, has about $40 billion in assets and Western Alliance, which is headquartered in Phoenix, has $65 billion in assets.
Both banks have fewer than 100 branches.
The most immediate threat facing banks, according to analysts, is a crisis of confidence.
Headlines about its spiraling decline in share value could scare off depositors and upend banks’ ability to operate normally.
