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Regional bank Pac West Bancorp has secured a $1.4 billion line of credit from an Atlas SP Partners finance facility as part of its effort to boost liquidity, after customers withdrew roughly 20% of their deposits in the first few months of 2023. According to a statement released by the bank, deposits have been stabilized.
About $4.9 billion of the nearly $7 billion in deposit outflow were from PacWest’s venture banking operations. The bank has reported that it still maintains cash on hand totaling more than $11.4 billion. PacWest’s total deposits have fallen to $27.1 billion since the fourth quarter of 2022.
The bank’s latest move to boost liquidity comes on the heels of several other financing successes. PacWest has already obtained $10.5 billion from the Federal Reserve discount window, as well as a $3.7 billion loan from the Federal Home Loan Bank Systems and an additional $2.1 billion from a recently rolled-out Fed program designed to assist banks as they protect depositor interests.
PacWest has announced that it will forgo a previously planned move to raise capital:
“In light of the current volatility in the market and depressed market prices for regional bank stocks, as well as the availability of other options to enhance capital, the company determined it would not be prudent to move forward with a transaction at this time.”