Fitch stabilizes Western Alliance view

Fitch Ratings said it revised the outlook for Western Alliance Bancorp. (WAL) and Western Alliance Bank (WAB) to stable from negative. Fitch affirmed both companies' long-term issuer default ratings at BBB-.

“Today's rating action is underpinned by improvements in WAL's funding and liquidity profile, which was revised to stable from negative. Deposit outflows have demonstrated stability for two consecutive quarters, demonstrating a recovery from March. Deposit concentration still remains a concern, but the company's contingent liquidity has improved, benefitting from balance sheet optimization and loan disposals.

“The company's gross loans to customer deposits ratio improved to 94% in 3Q23 from 112% at 1Q23 while its uninsured deposit liquidity coverage improved to 293%,” Fitch said in a press release.

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