Quarterly profits rise for Western Alliance, City National
Two of the nation’s largest regional banking companies with subsidiaries in Nevada posted second-quarter earnings Thursday that topped Wall Street expectations.
City National Corp., parent of City National Bank, reported its 81st consecutive profitable quarter with net income of $59.7 million, or $1.04 per share, for the three months ended June 30, compared with $54.8 million, or $1.01 a share, for the same period a year earlier.
Strong loan growth and a reduction of short-term borrowing spurred the increase in profits. City National’s net interest margin, a measure of profitability, averaged 3.22 percent, down from 3.83 percent last year.
Analysts surveyed by Yahoo Finance expected earnings of 96 cents a share. Los Angeles-based City National Bank reported $27.4 billion in assets. Nine of the bank’s 80 branches are in Nevada.
Revenue of $285 million for the quarter missed analysts’ estimates of $296.2 million.
“City National delivered another solid performance in the second quarter ... achieving double-digit growth in assets, loans, deposits and wealth management fee income,” City National Bank President and CEO Russell Goldsmith said.
Goldsmith expects net income growth in 2013 to be modest. In its earnings report, the company said the current low short-term interest rate environment and relatively flat yield curve will continue to put pressure on the company’s net interest margin.
Meanwhile, Bank of Nevada’s parent company, Western Alliance Bancorp, earned $34 million, or 39 cents a share, in its second quarter, ended June 30, up from $21 million, or 24 cents a share, a year earlier. Western Alliance’s earnings beat analysts’ expectations of 27 cents a share. Revenue of $87.2 million missed analysts’ expectations of $88.5 million in the second quarter.
The Phoenix-based bank holding company said its earnings include an $8.5 million gain from the acquisition of Centennial Bank, a deal that closed in the first quarter. Western Alliance’s acquisition of Fountain Valley, Calif.-based Centennial was valued at about $57.5 million.
Bank of Nevada reported loans increased by $115 million during the second quarter to $2.42 billion. In its earnings report, the Las Vegas-based bank attributed its loan growth to a rise in commercial real estate and construction and land development loans.
Deposits increased by $13 million in the quarter to $2.62 billion. Net income for Bank of Nevada was $12.7 million for the second quarter, up from $3.8 million a year earlier.
Bank of Nevada operates 12 branches in Mesquite, North Las Vegas, Henderson and Las Vegas.
Shares of Western Alliance gained 31 cents, or 1.85 percent, to $17.08, while City National jumped $2.02, or 3.1 percent, to close at $67.22 on Thursday. Both companies are listed on the New York Stock Exchange.
Zions Bancorp, parent company of Las Vegas-based Nevada State Bank, will release second-quarter earnings Monday. Wall Street forecasts the Salt Lake City-based company will post a profit of 41 cents, a rise from 30 cents per share a year ago. Analysts expect revenue of $552.3 million.
Contact reporter Chris Sieroty at csieroty@reviewjournal
.com or 702-477-3893. Follow @sierotyfeatures on Twitter.
