Western Alliance Reports Second Quarter 2013 Net Income of $34.0 Million, or $0.39 Per Share

PHOENIX--(BUSINESS WIRE)--July 18, 2013--Western Alliance Bancorporation (NYSE:WAL) announced today its financial results for the second quarter 2013.

“Our proven business model of exceptional client service, strong credit underwriting, and striving for continued performance improvement has driven our record earnings for the second quarter,” said Robert Sarver, Chairman and Chief Executive Officer of Western Alliance Bancorporation. “On the revenue side, strong loan growth and disciplined pricing led to record net interest income. Meanwhile, effective cost control and leveraging our infrastructure resulted in improved operating efficiency, as deposits per branch rose over 10% during the past year to $171 million. The acquisition of Centennial Bank augmented our results with a bargain purchase gain and higher earning assets. Continued collection activities and economic recovery resulted in a gain on sale of real estate owned and a lower credit provision as non-performing loans and repossessed assets fell to under 2%. We also invested in our future by recruiting new members to our team and, on July 1^st, opened our 42^nd office to more effectively serve the vibrant Scottsdale Airpark market.”

Western Alliance Bancorporation reported net income of $34.0 million, or $0.39 per share, in the second quarter 2013 (includes an $8.5 million gain from the acquisition of Centennial Bank, net of merger related expenses and tax), more than double the $14.0 million, or $0.15 per share, earned one year ago. Key performance improvement drivers include sustained organic balance sheet growth, prudent expense management, and reduced legacy asset costs against the backdrop of improved economic conditions.

Total loans increased $556 million to $6.41 billion at June 30, 2013 from $5.86 billion on March 31, 2013. Loans increased $1.25 billion, or 24.1%, from June 30, 2012. The increases in each of these periods were primarily driven by growth in commercial and industrial loans and commercial real estate loans.

Total deposits increased $266 million to $7.00 billion at June 30, 2013 from $6.73 billion at March 31, 2013. Deposits increased $1.00 billion from June 30, 2012. The increases in each of these periods were primarily due to growth in certificates of deposits and savings and money market deposits.

Net interest income was $82.2 million in the second quarter 2013, an increase of $6.0 million, or 7.8%, from $76.2 million in the first quarter of 2013 and an increase of $11.3 million, or 16.0%, compared to the second quarter 2012. The Company’s net interest margin remained flat in the second quarter 2013 at 4.36% compared to the first quarter 2013 and decreased from 4.46% in the second quarter 2012.

Operating non-interest income was $5.0 million for the second quarter 2013, down from $5.1 million in the first quarter of 2013 and down from $5.8 million for the second quarter of 2012.¹

Net revenue was $87.2 million for the second quarter 2013, up from $81.3 million for the first quarter of 2013 and an increase of 13.8% from $76.6 million for the second quarter 2012.¹

Operating non-interest expense was $47.0 million for the second quarter 2013, compared to $46.2 million for the first quarter of 2013 and $44.5 million for the second quarter of 2012.¹ The Company’s operating efficiency ratio¹ on a tax equivalent basis was 52.2% for the second quarter 2013, an improvement from 54.6% for the first quarter 2013 and 56.4% for the second quarter 2012 as the growth rate in revenue continued to outpace that of expense.

The Company had 1,015 full-time equivalent employees and 41 offices at June 30, 2013, compared to 953 employees and 39 offices one year ago.

The Company views its pre-tax, pre-provision operating earnings as a key metric for assessing the Company’s earning power, which it defines as net operating revenue less operating non-interest expense. For the second quarter 2013, the Company’s performance was $40.1 million, up from $35.1 million in the first quarter 2013 and up 25.2% from $32.1 million in the second quarter 2012.

The provision for credit losses was $3.5 million for the second quarter 2013, compared to $5.4 million for the first quarter 2013. The provision for the second quarter of 2012 was $13.3 million. Net loan charge-offs in the second quarter 2013 were $2.7 million, or 0.17% of average loans (annualized), down from 0.38% of average loans (annualized) for the first quarter 2013. Net charge-offs for the second quarter 2012 were $13.9 million or 1.11% of average loans (annualized).

Nonaccrual loans decreased $11 million to $83 million during the quarter. Loans past due 90 days and still accruing interest totaled $793 thousand at June 30, 2013, compared to $2 million at March 31, 2013 and $795 thousand at June 30, 2012. Loans past due 30-89 days, still accruing interest totaled $7 million at quarter end, down from $15 million at March 31, 2013 and down from $14 million at June 30, 2012.

As the Company’s asset quality improved and its capital increased, the ratio of classified assets to Tier I capital plus the allowance for credit losses, a common regulatory measure of asset quality, improved to 32% at June 30, 2013 from 42% at June 30, 2012.¹

Net gain on sales and valuation of repossessed assets (primarily other real estate) was $1.1 million for the second quarter 2013 compared to a $0.5 million loss from the first quarter 2013 and a $0.9 million loss in the second quarter 2012. At June 30, 2013, other repossessed assets totaled $76.5 million compared to $77.9 million at March 31, 2013 and $77.0 million one year ago. During the second quarter 2013, the Company’s net sales proceeds received from other repossessed real estate dispositions was 116.9% of carrying value.

During the quarter, the Company completed its acquisition of Centennial Bank, which increased assets, loans and deposits at June 30, 2013 by $403 million, $343 million and $298 million, respectively, and recorded a net acquisition gain of $8.5 million. Pursuant to the accounting guidance, acquired net assets are recorded at estimated fair value. The estimated fair value of certain net assets are preliminary and subject to measurement period adjustments.

Gross loans totaled $6.41 billion at June 30, 2013, an increase of $556 million from March 31, 2013 and an increase of $1.25 billion from $5.16 billion at June 30, 2012. At June 30, 2013, the allowance for credit losses was 1.50% of total loans, which has declined from 1.63% at March 31, 2013 and 1.89% at June 30, 2012, as the Company’s asset quality has improved.

Deposits totaled $7.00 billion at June 30, 2013, an increase of $266 million from $6.73 billion at March 31, 2013 and an increase of $1.00 billion from $6.00 billion at June 30, 2012. Non-interest bearing deposits were flat at $1.92 billion at June 30, 2013 compared to March 31, 2013 and increased $77 million from $1.84 billion at June 30, 2012. Non-interest bearing deposits comprised 27.4% of total deposits at June 30, 2013, compared to 30.7% a year ago, while the proportion from savings and money market increased to 42.1% from 40.6% during the same period. Certificates of deposit as a percent of total deposits were 21.5% at June 30, 2013. The Company’s ratio of loans to deposits was 91.2% at June 30, 2013 compared to 86.9% at March 31, 2013 and 86.1% at June 30, 2012.

Stockholders’ equity at June 30, 2013 increased to $800 million from $781 million at March 31, 2013. At June 30, 2013, tangible common equity was 7.4% of tangible assets¹ and total risk-based capital was 12.0% of risk-weighted assets. The Company’s tangible book value per share¹ was $7.26 at June 30, 2013, up 20.8% during the past year.

Total assets increased to $8.59 billion at June 30, 2013 from $8.17 billion at March 31, 2013 and increased 20.0% from $7.16 billion at June 30, 2012.

Western Alliance Bank (doing business as Alliance Bank of Arizona and First Independent Bank) reported loan growth of $339 million during the second quarter 2013 and $671 million during the last 12 months to $2.45 billion. Second quarter loan growth came primarily from the acquisition of Centennial Bank (which was merged into Western Alliance Bank). Deposits increased $208 million in the second quarter and $651 million during the last 12 months to $2.65 billion. Net income for Western Alliance Bank was $20.5 million during the second quarter 2013 compared with net income of $8.5 million during the first quarter of 2013 and net income of $7.8 million during the second quarter 2012.

Bank of Nevada, which was the recipient of net affiliate loan sales and participations, reported that loans increased by $115 million during the second quarter of 2013 and increased $414 million during the last 12 months to $2.42 billion at June 30, 2013. Second quarter loan growth came primarily from a rise in commercial real estate and construction and land development loans. Deposits increased by $13 million in the second quarter of 2013 and $189 million over the last twelve months to $2.62 billion. Net income for Bank of Nevada was $12.7 million for the second quarter 2013, compared with net income of $10.7 million for the first quarter of 2013 and net income of $3.8 million during the second quarter 2012.

The Torrey Pines Bank segment, which excludes the discontinued operations of PartnersFirst, reported that loans increased $92 million during the second quarter 2013 and increased $100 million during the last 12 months to $1.52 billion. Second quarter increases in loan balances were primarily attributable to an increase in commercial and industrial loans. Deposits increased $51 million in the second quarter 2013 and $157 million over the last 12 months to $1.75 billion. Net income for Torrey Pines Bank was $5.8 million during the second quarter 2013 compared with net income of $6.3 million for the first quarter of 2013 and net income of $5.3 million during the second quarter 2012.

Attached to this press release is summarized financial information for the quarter ended June 30, 2013.

Western Alliance Bancorporation will host a conference call and live webcast to discuss its second quarter 2013 financial results at 12:00 p.m. ET on Friday, July 19, 2013. Participants may access the call by dialing 1-888-317-6003 and using passcode: 2074791 or via live audio webcast using the website link: https://services.choruscall.com/links/wal130719.html. The webcast is also available via the Company’s website at www.westernalliancebancorp.com. Participants should log in at least 15 minutes early to receive instructions. The call will be recorded and made available for replay after 2:00 p.m. ET July 19^th through August 2^ndat 9:00 a.m. ET by dialing 1-877-344-7529 using the conference number 10031032.

Western Alliance Bancorporation is the parent company of Bank of Nevada, Western Alliance Bank doing business as Alliance Bank of Arizona and First Independent Bank, and Torrey Pines Bank. These dynamic organizations provide a broad array of deposit and credit services to clients in Nevada, Arizona and California. Staffed with experienced financial professionals, these organizations deliver a broader product array and larger credit capacity than community banks, yet are empowered to be more responsive to customers' needs than larger institutions. Additional investor information can be accessed on the Investor Relations page of the Company's website, www.westernalliancebancorp.com.

This release contains forward-looking statements that relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. The forward-looking statements contained herein reflect our current views about future events and financial performance and are subject to risks, uncertainties, assumptions and changes in circumstances that may cause our actual results to differ significantly from historical results and those expressed in any forward-looking statement. Some factors that could cause actual results to differ materially from historical or expected results include: factors discussed in our Annual Report on Form 10-K for the year ended December 31, 2012 as filed with the Securities and Exchange Commission; changes in general economic conditions, either nationally or locally in the areas in which we conduct or will conduct our business; inflation, interest rate, market and monetary fluctuations; increases in competitive pressures among financial institutions and businesses offering similar products and services; higher defaults on our loan portfolio than we expect; changes in management’s estimate of the adequacy of the allowance for credit losses; legislative or regulatory changes or changes in accounting principles, policies or guidelines; supervisory actions by regulatory agencies which may limit our ability to pursue certain growth opportunities; management’s estimates and projections of interest rates and interest rate policy; the execution of our business plan; and other factors affecting the financial services industry generally or the banking industry in particular.

We do not intend and disclaim any duty or obligation to update or revise any industry information or forward-looking statements set forth in this press release to reflect new information, future events or otherwise.

This press release contains both financial measures based on accounting principles generally accepted in the United States (“GAAP”) and non-GAAP based financial measures, which are used where management believes it to be helpful in understanding Western Alliance Bancorporation’s results of operations or financial position. Where non-GAAP financial measures are used, the comparable GAAP financial measure, as well as the reconcilement to the comparable GAAP financial measure, can be found in this press release. These disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.


Western Alliance Bancorporation and Subsidiaries
Summary Consolidated Financial Data
Unaudited
	At or for the Three Months									For the Six Months
	Ended June 30,									Ended June 30,
	2013			2012			Change %			2013			2012			Change %

Selected Balance Sheet Data:
(dollars in millions)
Total assets	$	8,593.7		$	7,163.6		20.0		%
Loans, net of deferred fees		6,411.5			5,164.8		24.1
Securities and money market investments		1,313.1			1,401.5		(6.3	)
Securities purchased under agreement to resell		134.0			-		-
Total deposits		7,001.3			6,001.4		16.7
Borrowings		470.5			390.4		20.5
Junior subordinated debt		39.9			36.7		8.7
Stockholders' equity		799.5			672.1		19.0

Selected Income Statement Data:
(dollars in thousands)
Interest income	$	89,285		$	77,846		14.7		%	$	172,393		$	155,283		11.0		%
Interest expense		7,133			7,041		1.3				14,038			14,421		(2.7	)
Net interest income		82,152			70,805		16.0				158,355			140,862		12.4
Provision for loan losses		3,481			13,330		(73.9	)			8,920			26,411		(66.2	)
Net interest income after provision for credit losses		78,671			57,475		36.9				149,435			114,451		30.6
Non-interest income		10,862			7,397		46.8				14,761			13,281		11.1
Non-interest expense		48,531			45,431		6.8				95,460			92,328		3.4
Income from continuing operations, before income tax expense		41,002			19,441		110.9				68,736			35,404		94.1
Income tax expense		6,817			5,259		29.6				13,625			9,700		40.5
Income from continuing operations		34,185			14,182		141.0				55,111			25,704		114.4		%
Loss on discontinued operations, net		(169	)		(221	)	23.5				(131	)		(443	)
Net income	$	34,016		$	13,961		143.7		%	$	54,980		$	25,261
Diluted net income per common share from continuing operations	$	0.39		$	0.16					$	0.63		$	0.28
Diluted net loss per common share from discontinued operations, net of tax	$	(0.00	)	$	(0.00	)				$	(0.00	)	$	(0.01	)
Diluted net income per common share	$	0.39		$	0.15		160.0		%	$	0.63		$	0.27		133.0		%

Common Share Data:
Diluted net income per common share	$	0.39		$	0.15		160.0		%	$	0.63		$	0.27		133.0		%
Book value per common share	$	7.57		$	6.39		18.5		%
Tangible book value per share, net of tax (1)	$	7.26		$	6.01		20.8		%
Average shares outstanding (in thousands):
Basic		85,659			81,590		5.0				85,493			81,475		4.9
Diluted		86,524			81,955		5.6				86,254			82,091		5.1
Common shares outstanding		86,997			83,157		4.6

(1) See Reconciliation of Non-GAAP Financial Measures


Western Alliance Bancorporation and Subsidiaries
Summary Consolidated Financial Data (continued)
Unaudited
	At or for the Three Months							For the Six Months
	Ended June 30,							Ended June 30,
	2013		2012		Change %			2013		2012		Change %
	(in thousands, except per share data)
Selected Performance Ratios:
Return on average assets (1)	1.64	%	0.80	%	105.0		%	1.37	%	0.74	%	85.1		%
Return on tangible common equity (2)	21.66		11.26		92.4			17.60		10.25		71.7
Net interest margin (1)	4.36		4.46		(2.2	)		4.36		4.49		(2.9	)
Net interest spread	4.22		4.27		(1.2	)		4.21		4.31		(2.3	)
Efficiency ratio - tax equivalent basis (2)	52.21		56.44		(7.5	)
Loan to deposit ratio	91.58		86.06		6.4

Capital Ratios:
Tangible equity (2)	9.0	%	8.9	%	0.6		%
Tangible common equity (2)	7.4		7.0		5.5
Tier 1 common equity (2)	8.3		8.0		4.3
Tier 1 Leverage ratio (3)	9.9		9.7		2.1
Tier 1 Risk Based Capital (3)	10.8		11.0		(1.8	)
Total Risk Based Capital (3)	12.0		12.3		(2.4	)

Asset Quality Ratios:
Net charge-offs to average loans outstanding (1)	0.17	%	1.11	%	(84.7	)	%	0.71	%	1.15	%	(38.3	)	%
Nonaccrual loans to gross loans	1.42		2.02		(29.7	)
Nonaccrual loans and repossessed assets to total assets	1.85		2.53		(26.9	)
Loans past due 90 days and still accruing to total loans	0.01		0.02		(50.0	)
Allowance for credit losses to loans	1.50		1.89		(20.6	)
Allowance for credit losses to nonaccrual loans	116.19		93.47		24.3

(1) Annualized for the three and six month periods ended June 30, 2013 and 2012.
(2) See Reconciliation of Non-GAAP Financial Measures.
(3) Capital ratios are preliminary until Call Reports are filed.


Western Alliance Bancorporation and Subsidiaries
Condensed Consolidated Income Statements
Unaudited	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2013			2012			2013			2012
Interest income:	(dollars in thousands)
Loans	$	81,093		$	68,342		$	155,818		$	136,102
Investment securities		7,822			9,389			15,980			18,974
Federal funds sold and other		370			115			595			207
Total interest income		89,285			77,846			172,393			155,283
Interest expense:
Deposits		3,929			4,168			7,661			8,930
Borrowings		2,749			2,386			5,456			4,520
Junior subordinated debt		455			487			921			971
Total interest expense		7,133			7,041			14,038			14,421
Net interest income		82,152			70,805			158,355			140,862
Provision for credit losses		3,481			13,330			8,920			26,411
Net interest income after provision for credit losses		78,671			57,475			149,435			114,451
Non-interest income
Service charges		2,449			2,317			4,983			4,602
Bank owned life insurance		1,036			1,120			2,072			2,243
Amortization of affordable housing investments		(900	)		(59	)		(1,800	)		(59	)
(Losses) Gains on sales of investment securities, net		(5	)		1,110			142			1,471
Unrealized (losses) gains on assets/liabilities measured at fair value, net		(3,290	)		564			(3,761	)		232
Bargain purchase gain from acquisition		10,044			-			10,044			-
Other		1,528			2,345			3,081			4,792
Total non-interest income		10,862			7,397			14,761			13,281
Non-interest expenses:
Salaries and employee benefits		28,100			25,995			54,674			52,659
Occupancy		4,753			4,669			9,599			9,391
Legal, professional and director's fees		2,227			2,517			5,011			4,089
Insurance		2,096			2,152			4,466			4,202
Data Processing		2,175			1,293			4,040			2,288
Marketing		1,607			1,459			3,371			2,830
Loan and repossessed asset expenses		721			1,653			2,317			3,337
Customer service		717			682			1,360			1,274
Net (gain) loss on sales and valuations of repossessed assets		(1,124	)		901			(605	)		3,552
Intangible amortization		597			890			1,194			1,779
Merger/restructure expense		2,620			-			2,815			-
Other		4,042			3,220			7,218			6,927
Total non-interest expense		48,531			45,431			95,460			92,328
Income from continuing operations before income taxes		41,002			19,441			68,736			35,404
Income tax expense		6,817			5,259			13,625			9,700
Income from continuing operations		34,185			14,182			55,111			25,704
Loss from discontinued operations net of tax benefit		(169	)		(221	)		(131	)		(443	)
Net income		34,016			13,961			54,980			25,261
Preferred stock dividends		353			1,325			706			3,088
Net income available to common stockholders	$	33,663		$	12,636		$	54,274		$	22,173
Diluted net income per share	$	0.39		$	0.15		$	0.63		$	0.27


Western Alliance Bancorporation and Subsidiaries
Five Quarter Condensed Consolidated Income Statements
Unaudited	Three Months Ended
	June 30,			March 31,			December 31,			September 30,			June 30,
	2013			2013			2012			2012			2012
Interest income:	(in thousands, except per share data)
Loans	$	81,093		$	74,725		$	75,303		$	69,580		$	68,342
Investment securities		7,822			8,158			8,794			9,034			9,389
Federal funds sold and other		370			225			246			55			115
Total interest income		89,285			83,108			84,343			78,669			77,846
Interest expense:
Deposits		3,929			3,732			3,890			3,974			4,168
Borrowings		2,749			2,707			2,528			2,262			2,386
Junior subordinated debt		455			466			470			487			487
Total interest expense		7,133			6,905			6,888			6,723			7,041
Net interest income		82,152			76,203			77,455			71,946			70,805
Provision for credit losses		3,481			5,439			11,501			8,932			13,330
Net interest income after provision for credit losses		78,671			70,764			65,954			63,014			57,475
Non-interest income
Service charges		2,449			2,534			2,438			2,412			2,317
Bank owned life insurance		1,036			1,036			1,080			1,116			1,120
Amortization of affordable housing investments		(900	)		(900	)		(1,069	)		(651	)		(59	)
(Losses) Gains on sales of investment securities, net		(5	)		147			1,447			1,031			1,110
Unrealized (losses) gains on assets/liabilities measured at fair value, net		(3,290	)		(471	)		(48	)		470			564
Bargain purchase gain from acquisition		10,044			-			17,562			-			-
Other		1,528			1,553			3,053			2,604			2,345
Total non-interest income		10,862			3,899			24,463			6,982			7,397
Non-interest expenses:
Salaries and employee benefits		28,100			26,574			26,885			25,500			25,995
Occupancy		4,753			4,846			4,769			4,655			4,669
Legal, professional and director's fees		2,227			2,784			1,849			2,291			2,517
Data Processing		2,175			1,865			2,071			1,390			1,293
Insurance		2,096			2,370			2,188			2,121			2,152
Marketing		1,607			1,764			1,546			1,231			1,459
Loan and repossessed asset expenses		721			1,596			2,102			1,236			1,653
Customer service		717			643			678			653			682
Net (gain) loss on sales and valuations of repossessed assets		(1,124	)		519			529			126			901
Intangible amortization		597			597			596			880			890
Merger/restructure expense		2,620			195			2,706			113			-
Goodwill and intangible impairment		-			-			-			3,435			-
Other		4,042			3,176			3,070			3,912			3,220
Total non-interest expense		48,531			46,929			48,989			47,543			45,431
Income from continuing operations before income taxes		41,002			27,734			41,428			22,453			19,441
Income tax expense		6,817			6,808			7,509			6,752			5,259
Income from continuing operations	$	34,185		$	20,926		$	33,919		$	15,701		$	14,182
(Loss) Income from discontinued operations, net of tax		(169	)		38			(1,804	)		(243	)		(221	)
Net income	$	34,016		$	20,964		$	32,115		$	15,458		$	13,961
Preferred stock dividends		353			353			353			352			1,325
Net Income available to common stockholders	$	33,663		$	20,611		$	31,762		$	15,106		$	12,636
Diluted net income per share	$	0.39		$	0.24		$	0.37		$	0.18		$	0.15


Western Alliance Bancorporation and Subsidiaries
Five Quarter Condensed Consolidated Balance Sheets
Unaudited
	June 30,			March 31,			December 31,			September 30,			June 30,
	2013			2013			2012			2012			2012
Assets:	(in millions)
Cash and due from banks	$	248.9		$	422.3		$	204.6		$	168.1		$	178.9
Securities purchased under agreement to resell		134.0			134.0			-			139.8			-
Cash and cash equivalents		382.9			556.3			204.6			307.9			178.9

Securities and money market investments		1,313.1			1,302.4			1,236.6			1,338.9			1,401.5
Loans held for sale		27.6			27.9			31.1			-			-
Loans held for investment
Commercial		2,174.1			2,084.9			1,947.8			1,756.0			1,573.6
Commercial real estate - non-owner occupied		1,839.7			1,538.4			1,505.6			1,407.1			1,440.4
Commercial real estate - owner occupied		1,550.0			1,414.3			1,396.8			1,331.3			1,310.3
Construction and land development		416.7			381.1			394.3			379.8			360.6
Residential real estate		381.7			388.7			407.9			408.4			430.4
Consumer		28.5			26.0			31.8			56.6			55.8
Deferred fees, net		(6.8	)		(6.0	)		(6.0	)		(6.3	)		(6.3	)
Gross loans and deferred fees, net		6,383.9			5,827.4			5,678.2			5,332.9			5,164.8
Allowance for credit losses		(96.3	)		(95.5	)		(95.4	)		(97.4	)		(97.5	)
Loans, net		6,287.6			5,731.9			5,582.8			5,235.5			5,067.3

Premises and equipment, net		106.1			107.1			107.9			106.9			106.9
Other repossessed assets		76.5			77.9			77.2			78.2			77.0
Bank owned life insurance		140.4			139.4			138.3			137.3			136.1
Goodwill and other intangibles		28.5			29.2			29.8			29.0			34.0
Other assets		231.0			202.0			214.3			169.9			161.9
Total assets	$	8,593.7		$	8,174.1		$	7,622.6		$	7,403.6		$	7,163.6
Liabilities and Stockholders' Equity:
Liabilities:
Deposits:
Non-interest bearing demand deposits	$	1,919.6		$	1,930.4		$	1,933.2		$	1,840.8		$	1,842.1
Interest bearing
Demand		631.3			619.7			582.3			514.7			540.6
Savings and money market		2,945.1			2,826.7			2,573.5			2,541.2			2,438.4
Time certificates		1,505.3			1,358.1			1,366.2			1,265.3			1,180.3
Total deposits		7,001.3			6,734.9			6,455.2			6,162.0			6,001.4
Customer repurchase agreements		51.9			64.7			79.0			73.1			86.9
Total customer funds		7,053.2			6,799.6			6,534.2			6,235.1			6,088.3
Securities sold short		129.5			132.6			-			138.3			-
Borrowings		418.6			293.8			193.7			223.6			303.5
Junior subordinated debt		39.9			36.7			36.2			36.2			36.7
Accrued interest payable and other liabilities		153.0			130.1			98.9			72.4			63.0
Total liabilities		7,794.2			7,392.8			6,863.0			6,705.6			6,491.5
Stockholders' Equity
Common stock and additional paid-in capital		789.5			786.9			784.9			751.1			748.1
Preferred Stock		141.0			141.0			141.0			141.0			141.0
Accumulated deficit		(120.2	)		(153.8	)		(174.5	)		(206.2	)		(221.3	)
Accumulated other comprehensive (loss) income		(10.8	)		7.2			8.2			12.1			4.3
Total stockholders' equity		799.5			781.3			759.6			698.0			672.1
Total liabilities and stockholders' equity	$	8,593.7		$	8,174.1		$	7,622.6		$	7,403.6		$	7,163.6


Western Alliance Bancorporation and Subsidiaries
Changes in the Allowance For Credit Losses
Unaudited
	Three Months Ended
	June 30,			March 31,			December 31,			September 30,			June 30,
	2013			2013			2012			2012			2012

	(in thousands)
Balance, beginning of period	$	95,494		$	95,427		$	97,410		$	97,512		$	98,122
Provision for credit losses		3,481			5,439			11,501			8,932			13,330
Recoveries of loans previously charged-off:
Commercial and industrial		1,757			441			372			501			1,417
Commercial real estate - non-owner occupied		154			440			288			27			368
Commercial real estate - owner occupied		479			502			109			606			193
Construction and land development		120			701			2,033			567			217
Residential real estate		549			569			313			153			274
Consumer		11			14			63			38			214
Total recoveries		3,070			2,667			3,178			1,892			2,683
Loans charged-off:
Commercial and industrial		1,065			1,770			4,654			4,100			4,933
Commercial real estate - non-owner occupied		1,000			1,908			2,673			998			2,463
Commercial real estate - owner occupied		1,391			979			4,470			472			3,178
Construction and land development		238			614			405			2,315			3,185
Residential real estate		2,010			2,493			1,307			2,242			2,094
Consumer		18			275			3,153			799			770
Total loans charged-off		5,722			8,039			16,662			10,926			16,623
Net loans charged-off		2,652			5,372			13,484			9,034			13,940
Balance, end of period	$	96,323		$	95,494		$	95,427		$	97,410		$	97,512

Net charge-offs (annualized) to average loans outstanding		0.17	%		0.38	%		0.99	%		0.70	%		1.11	%
Allowance for credit losses to gross loans		1.50			1.63			1.67			1.83			1.89
Nonaccrual loans	$	82,899		$	93,748		$	104,716		$	121,238		$	104,324
Repossessed assets		76,499			77,921			77,247			78,234			76,994
Loans past due 90 days, still accruing		793			1,640			1,388			1,710			795
Loans past due 30 to 89 days, still accruing		7,341			14,795			16,565			10,181			13,848
Classified loans on accrual		140,192			97,351			112,637			116,841			135,913
Special mention loans		115,135			125,660			103,550			97,681			91,924


Western Alliance Bancorporation and Subsidiaries
Analysis of Average Balances, Yields and Rates
Unaudited
	Three Months Ended June 30,
	2013							2012
	Average Balance			Interest		Average Yield/ Cost		Average Balance			Interest		Average Yield/ Cost
Interest earning assets	($ in millions)			($ in thousands)				($ in millions)			($ in thousands)
Loans (1)	$	6,100.8		$	81,093	5.40	%	$	5,014.1		$	68,342	5.50	%
Investment securities (1)		1,295.9			7,822	2.92	%		1,417.1			9,389	3.15	%
Federal funds sold and other		407.6			370	0.36	%		133.1			115	0.35	%
Total interest earning assets		7,804.4			89,285	4.73	%		6,564.3			77,846	4.88	%
Non-interest earning assets
Cash and due from banks		119.2							113.1
Allowance for credit losses		(96.6	)						(97.5	)
Bank owned life insurance		139.7							135.4
Other assets		432.7							346.9
Total assets	$	8,399.4						$	7,062.2
Interest-bearing liabilities
Interest-bearing deposits:
Interest-bearing transaction accounts	$	626.8		$	370	0.24	%	$	518.4		$	310	0.24	%
Savings and money market		2,768.7			2,007	0.29	%		2,296.0			1,956	0.34	%
Time certificates of deposit		1,584.0			1,552	0.39	%		1,320.7			1,902	0.58	%
Total interest-bearing deposits		4,979.5			3,929	0.32	%		4,135.1			4,168	0.40	%
Borrowings		554.0			2,749	1.98	%		425.7			2,386	2.24	%
Junior subordinated debt		36.7			455	4.96	%		37.3			487	5.22	%
Total interest-bearing liabilities		5,570.1			7,133	0.51	%		4,598.1			7,041	0.61	%
Noninterest-bearing liabilities
Noninterest-bearing demand deposits		1,898.2							1,744.1
Other liabilities		124.6							52.1
Stockholders’ equity		806.4							667.9
Total liabilities and stockholders' equity	$	8,399.4						$	7,062.2
Net interest income and margin				$	82,152	4.36	%				$	70,805	4.46	%
Net interest spread						4.22	%						4.27	%


Western Alliance Bancorporation and Subsidiaries
Analysis of Average Balances, Yields and Rates
Unaudited

	Six Months Ended June 30,
	2013							2012

	Average Balance			Interest		Average Yield/ Cost		Average Balance			Interest		Average Yield/ Cost
Interest earning Assets	($ in millions)			($ in thousands)				($ in millions)			($ in thousands)
Loans (1)	$	5,857.0		$	155,818	5.41	%	$	4,898.5		$	136,102	5.59	%
Investment securities (1)		1,289.7			15,980	3.06	%		1,420.2			18,974	3.14	%
Federal funds sold & other		406.2			595	0.29	%		132.2			207	0.31	%
Total interest earnings assets		7,552.9			172,393	4.73	%		6,450.9			155,283	4.94	%
Non-interest earning assets
Cash and due from banks		122.9							113.3
Allowance for credit losses		(96.8	)						(99.1	)
Bank owned life insurance		139.2							134.8
Other assets		427.3							352.5
Total assets	$	8,145.5						$	6,952.4
Interest-bearing liabilities
Interest-bearing deposits:
Interest bearing transaction accounts	$	617.8		$	671	0.22	%	$	511.3		$	624	0.24	%
Savings and money market		2,695.2			3,918	0.29	%		2,264.8			4,124	0.36	%
Time certificates of deposits		1,517.2			3,072	0.40	%		1,372.5			4,182	0.61	%
Total interest-bearing deposits		4,830.2			7,661	0.32	%		4,148.6			8,930	0.44	%
Borrowings		501.3			5,456	2.18	%		360.3			4,520	2.51	%
Junior subordinated debt		36.5			921	5.05	%		37.1			971	5.23	%
Total interest-bearing liabilities	$	5,368.0			14,038	0.52	%	$	4,546.0			14,421	0.63	%
Noninterest-bearing liabilities
Noninterest-bearing demand deposits		1,876.8							1,694.9
Other liabilities		108.2							48.7
Stockholders’ equity		792.5							662.8
Total liabilities and stockholders' equity	$	8,145.5						$	6,952.4
Net interest income and margin				$	158,355	4.36	%				$	140,862	4.49	%
Net interest spread						4.21	%						4.31	%


Western Alliance Bancorporation and Subsidiaries
Operating Segment Results
Unaudited													Inter-
													segment			Consoli-
	Western			Bank			Torrey						elimi-			dated
	Alliance Bank			of Nevada			Pines Bank*			Other			nations			Company
At June 30, 2013	(dollars in millions)
Assets	$	3,053.0		$	3,319.2		$	2,030.7		$	1,124.8		$	(934.0	)	$	8,593.7
Held for sale loans		-			-			27.6			-			-			27.6
Gross loans and deferred fees, net		2,454.4			2,416.3			1,494.0			62.1			(43.0	)		6,383.9
Less: Allowance for credit losses		(22.3	)		(55.8	)		(15.6	)		(2.6	)		-			(96.3	)
Loans, net		2,432.1			2,360.5			1,478.5			59.5			(43.0	)		6,287.6
Goodwill and intangible assets		3.0			25.6			-			-			-			28.6
Deposits		2,648.9			2,619.9			1,749.4			-			(16.9	)		7,001.3
Borrowings		74.7			200.0			45.0			123.9			(25.0	)		418.6
Stockholders' equity		262.4			393.1			170.1			817.8			(843.9	)		799.5

No. of branches		17			12			12			-			-			41
No. of FTE		293			388			229			105			-			1,015

Three Months Ended June 30, 2013:	(in thousands)
Net interest income	$	32,530		$	30,679		$	20,603			(1,660	)	$	-		$	82,152
Provision for credit losses		1,009			999			740			733			-			3,481
Net interest income (loss) after provision for credit losses		31,521			29,680			19,863			(2,393	)		-			78,671
Non-interest income		11,300			3,732			606			(294	)		(4,482	)		10,862
Non-interest expense		(17,100	)		(16,034	)		(11,958	)		(7,921	)		4,482			(48,531	)
Income (loss) from continuing operations before income taxes		25,721			17,378			8,511			(10,608	)		-			41,002
Income tax expense (benefit)		5,247			4,672			2,669			(5,771	)		-			6,817
Income (loss) from continuing operations		20,474			12,706			5,842			(4,837	)		-			34,185
Loss from discontinued operations, net		-						-			(169	)		-			(169	)
Net income (loss)	$	20,474		$	12,706		$	5,842		$	(5,006	)	$	-		$	34,016

Six Months Ended June 30, 2013:	(in thousands)
Net interest income	$	59,165		$	59,933		$	41,380		$	(2,123	)	$	-		$	158,355
Provision for credit losses		3,644			1,404			832			3,040			-			8,920
Net interest income (loss) after provision for credit losses		55,521			58,529			40,548			(5,163	)		-			149,435
Non-interest income		12,704			7,069			1,204			1,411			(7,627	)		14,761
Non-interest expense		(30,168	)		(33,925	)		(23,927	)		(15,067	)		7,627			(95,460	)
Income (loss) from continuing operations before income taxes		38,057			31,673			17,825			(18,819	)		-			68,736
Income tax expense (benefit)		9,089			8,265			5,668			(9,397	)		-			13,625
Income (loss) from continuing operations		28,968			23,408			12,157			(9,422	)		-			55,111
Loss from discontinued operations, net		-			-			-			(131	)		-			(131	)
Net income (loss)	$	28,968		$	23,408		$	12,157		$	(9,553	)	$	-		$	54,980

* Excludes discontinued operations


Western Alliance Bancorporation and Subsidiaries
Operating Segment Results
Unaudited													Inter-
													segment			Consoli-
	Western			Bank			Torrey						elimi-			dated
	Alliance Bank			of Nevada			Pines Bank*			Other			nations			Company
At June 30, 2012	(dollars in millions)
Assets	$	2,349.6		$	2,920.2		$	1,895.9		$	800.7		$	(802.8	)	$	7,163.6
Gross loans and deferred fees, net		1,783.6			2,002.1			1,422.0			-			(42.9	)		5,164.8
Less: Allowance for credit losses		(20.3	)		(60.5	)		(16.7	)		-			-			(97.5	)
Loans, net		1,763.3			1,941.6			1,405.3			-			(42.9	)		5,067.3
Goodwill and intangible assets		3.8			25.8			0.2			4.1			-			33.9
Deposits		1,998.2			2,430.9			1,592.5			-			(20.2	)		6,001.4
Borrowings		70.0			100.0			72.0			74			(12.0	)		303.5
Stockholders' equity		208.7			329.5			161.6			680.4			(708.1	)		672.1

No. of branches		16			11			12			-			-			39
No. of FTE		239			386			228			100			-			953

Three Months Ended June 30, 2012:	(in thousands)
Net interest income	$	24,060		$	27,498		$	21,374		$	(2,127	)	$	-		$	70,805
Provision for credit losses		2,100			8,747			2,483			-			-			13,330
Net interest income (loss) after provision for credit losses		21,960			18,751			18,891			(2,127	)		-			57,475
Non-interest income		1,994			4,291			1,079			1,929			(1,896	)		7,397
Non-interest expense		(12,086	)		(18,140	)		(11,338	)		(5,763	)		1,896			(45,431	)
Income (loss) from continuing operations before income taxes		11,868			4,902			8,632			(5,961	)		-			19,441
Income tax expense (benefit)		4,091			1,137			3,340			(3,309	)		-			5,259
Income (loss) from continuing operations		7,777			3,765			5,292			(2,652	)		-			14,182
Loss from discontinued operations, net		-			-			-			(221	)		-			(221	)
Net income (loss)	$	7,777		$	3,765		$	5,292		$	(2,873	)	$	-		$	13,961

Six Months Ended June 30, 2012:
Net interest income	$	47,116		$	55,337		$	42,610		$	(4,201	)	$	-		$	140,862
Provision for credit losses		103			22,229			4,079			-			-			26,411
Net interest income (loss) after provision for credit losses		47,013			33,108			38,531			(4,201	)		-			114,451
Non-interest income		3,847			7,874			2,256			3,893			(4,589	)		13,281
Noninterest expense		(24,005	)		(36,970	)		(22,410	)		(13,532	)		4,589			(92,328	)
Income (loss) from continuing operations before income taxes		26,855			4,012			18,377			(13,840	)		-			35,404
Income tax expense (benefit)		9,263			(714	)		7,297			(6,146	)		-			9,700
Income (loss) from continuing operations		17,592			4,726			11,080			(7,694	)		-			25,704
Loss from discontinued operations, net		-			-			-			(443	)		-			(443	)
Net income (loss)	$	17,592		$	4,726		$	11,080		$	(8,137	)	$	-		$	25,261

* Excludes discontinued operations


Western Alliance Bancorporation and Subsidiaries
Reconciliation of Non-GAAP Financial Measures (Unaudited)
	June 30,			March 31,			December 31,			September 30,			June 30,
	2013			2013			2012			2012			2012
	(dollars in thousands)
Total stockholders' equity	$	799,524		$	781,294		$	759,616		$	698,011		$	672,120
Less:
Goodwill and intangible assets		28,568			29,166			29,763			28,989			33,953
Total tangible stockholders' equity		770,956			752,128			729,853			669,022			638,167
Less:
Preferred stock		141,000			141,000			141,000			141,000			141,000
Total tangible common equity		629,956			611,128			588,853			528,022			497,167
Add:
Deferred tax		1,870			2,080			2,289			2,033			2,896
Total tangible common equity, net of tax	$	631,826		$	613,208		$	591,142		$	530,055		$	500,063
Total assets	$	8,593,684		$	8,174,103		$	7,622,637		$	7,403,603		$	7,163,572
Less:
Goodwill and intangible assets		28,568			29,166			29,763			28,989			33,953
Tangible assets		8,565,116			8,144,937			7,592,874			7,374,614			7,129,619
Add:
Deferred tax		1,870			2,080			2,289			2,033			2,896
Total tangible assets, net of tax	$	8,566,986		$	8,147,017		$	7,595,163		$	7,376,647		$	7,132,515
Tangible equity ratio (1)		9.0	%		9.2	%		9.6	%		9.1	%		8.9	%
Tangible common equity ratio (2)		7.4	%		7.5	%		7.8	%		7.2	%		7.0	%
Common shares outstanding		86,997			87,079			86,465			83,455			83,157
Tangible book value per share, net of tax (3)	$	7.26		$	7.04		$	6.84		$	6.35		$	6.01

	Three Months Ended
	June 30,			March 31,			December 31,			September 30,			June 30,
	2013			2013			2012			2012			2012
	(in thousands)
Total non-interest income	$	10,862		$	3,899		$	24,463		$	6,982		$	7,397
Less:
Unrealized (losses) gains on assets/liabilities measured at fair value, net		(3,290	)		(471	)		(48	)		470			564
Gain on sale of subsidiary/non-controlling interest		-			-			116			776			-
Bargain purchase gain from acquisition		10,044			-			17,562			-			-
Legal settlements		-			38			879			-			-
Mutual fund gains		-			-			483			-			-
Amortization of affordable housing investments		(900	)		(900	)		(1,069	)		(651	)		(59	)
(Losses) Gains on sales of investment securities, net		(5	)		147			1,447			1,031			1,110
Total operating non-interest income		5,013			5,085			5,093			5,356			5,782
Add: net interest income		82,152			76,203			77,455			71,946			70,805
Net operating revenue (4)	$	87,165		$	81,288		$	82,548		$	77,302		$	76,587

Total non-interest expense	$	48,531		$	46,929		$	48,989		$	47,543		$	45,431
Less:
Net (gain) loss on sales and valuations of repossessed assets		(1,124	)		519			529			126			901
Merger/restructure expense		2,620			195			2,706			113			-
Goodwill impairment		-			-			-			3,435			-
Total operating non-interest expense (4)	$	47,035		$	46,215		$	45,754		$	43,869		$	44,530

Net operating revenue	$	87,165		$	81,288		$	82,548		$	77,302		$	76,587
Less:
Operating non-interest expense		47,035			46,215			45,754			43,869			44,530
Pre-tax, pre-provision operating earnings (5)	$	40,130		$	35,073		$	36,794		$	33,433		$	32,057


Western Alliance Bancorporation and Subsidiaries
Reconciliation of Non-GAAP Financial Measures (Unaudited)

	Three Months Ended
	June 30,			March 31,			December 31,			September 30,			June 30,
	2013			2013			2012			2012			2012
	(in thousands)
Total operating non-interest expense	$	47,035		$	46,215		$	45,754		$	43,869		$	44,530
Divided by:
Total net interest income	$	82,152		$	76,203		$	77,455		$	71,946		$	70,805
Add:
Tax equivalent interest adjustment		2,929			3,382			3,012			2,655			2,310
Operating non-interest income		5,013			5,085			5,093			5,356			5,782
	$	90,094		$	84,670		$	85,560		$	79,957		$	78,897
Efficiency ratio - tax equivalent basis (6)		52.2	%		54.6	%		53.5	%		54.9	%		56.4	%

	Three Months Ended
	June 30,			June 30,
	2013			2012
	(in thousands)
Stockholders' equity	$	799,524		$	672,120
Less:
Accumulated other comprehensive (loss) income		(10,646	)		4,291
Non-qualifying goodwill and intangibles		26,756			31,748
Other non-qualifying assets		2			3
Disallowed unrealized losses on equity securities		103			-
Add:
Qualifying trust preferred securities		47,228			45,123
Tier 1 capital (regulatory) (7) (10)		830,537			681,201
Less:
Qualifying non-controlling interests		-			423
Qualifying trust preferred securities		47,228			45,123
Preferred stock		141,000			141,000
Estimated Tier 1 common equity (8) (10)	$	642,309		$	494,655
Divided by:
Estimated risk-weighted assets (regulatory) (8) (10)	$	7,698,091		$	6,181,246
Tier 1 common equity ratio (8) (10)		8.3	%		8.0	%

	June 30,			June 30,
	2013			2012
	(in thousands)
Classified assets	$	298,887		$	325,165
Divide:
Tier 1 capital (regulatory) (7) (10)		830,537			681,201
Plus: Allowance for credit losses		96,323			97,512
Total Tier 1 capital plus allowance for credit losses	$	926,860		$	778,713
Classified assets to Tier 1 capital plus allowance (9) (10)		32	%		42	%

(1)		We believe this non-GAAP ratio provides a critical metric with which to analyze and evaluate financial condition and capital strength.
(2)		We believe this non-GAAP ratio provides a critical metric with which to analyze and evaluate financial condition and capital strength.
(3)		We believe this non-GAAP ratio improves the comparability to other institutions that have not engaged in acquisitions that resulted in recorded goodwill and other intangibles.
(4)		We believe these non-GAAP measurements provide a useful indication of the cash generating capacity of the Company.
(5)		We believe this non-GAAP measurement is a key indicator of the earnings power of the Company, which is otherwise obscured by the asset quality issues.
(6)		We believe this non-GAAP ratio provides a useful metric to measure the operating efficiency of the Company.
(7)		Under the guidelines of the Federal Reserve and the FDIC in effect, Tier 1 capital consisted of common stock, retained earnings, non-cumulative perpetual preferred stock, trust preferred securities up to a certain limit, and minority interests in certain subsidiaries, less most other intangible assets.
(8)		Tier 1 common equity is often expressed as a percentage of risk-weighted assets. Under the risk-based capital framework, a bank's balance sheet assets and credit equivalent amounts of off-balance sheet items, are assigned to one of four broad risk categories. The aggregated dollar amount in each category is then multiplied by the risk weighting assigned to that category. The resulting weighted values from each of the four categories are added together and this sum is the risk-weighted assets total that, as adjusted, comprises the denominator (risk-weighted assets) to determine the Tier 1 capital ratio. Adjustments are made to Tier 1 capital to arrive at Tier 1 common equity. Tier 1 common equity is divided by the risk-weighted assets to determine the Tier 1 common equity ratio. We believe this non-GAAP ratio with which to analyze and evaluate financial condition and capital strength.
(9)		We believe this non-GAAP ratio provides a critical regulatory metric in which to analyze asset quality.
(10)		Preliminary until Call Reports are filed.