Western Alliance Bancorporation closed at $75.55 on November 6, 2026: 8.3 times its last four quarters of GAAP earnings, 1.11 times book value and 1.21 times tangible book value, with a dividend of $1.84 a year (2.4%) that it raised on October 30. It has made a profit in each of the last eleven years, including 2023, when its deposits fell 11.3% in one quarter and its shares fell 63% in three trading days. At the date of value it was 21% below its February 2026 high; the regional bank fund was down 1.7% over the same stretch.
In 2023 the market priced Western Alliance for a bank run, and the run did not finish it. In 2026 it priced the bank for two loan write-offs, both blamed on alleged fraud, that cost about 2.3% of its tangible common equity before tax.This workfile does five things. It describes the bank and its latest quarter (section 1). It sets out the price path with the dated event behind each large move, including election week (section 2). It records what happened the last time the bank was tested, in 2023 (section 3). It puts the earnings, the dividend and every valuation measure on the page (sections 4 to 7). And it lists the balance sheet, the lawsuits, the insiders and what would change the conclusion (sections 8 to 10).
Western Alliance earned $9.05 a share over the last four quarters, after writing off $152.5 million on two loans now in lawsuits in which the bank alleges fraud, and was priced at 1.21 times tangible book, against about 1.7 to 2.3 times reported in large bank takeovers in 2025. The position taken here rests on the earnings record and the 2023 test, and requires credit losses to stay near the range of the last year.
Western Alliance is a bank holding company in Phoenix, Arizona. Its bank, Western Alliance Bank, lends to and takes deposits from businesses, with specialized teams that it says serve more than 30 industries and sectors across the country, and it owns AmeriHome, a mortgage banking business (10-Q; release). It has more than $90 billion of assets, $61.5 billion of loans held for investment and $81.8 billion of deposits.
Two features set it apart from a branch bank. A large share of its deposits come from businesses, some of them tied to its mortgage lending, and on some of those it pays “earnings credits” that it books as an expense, which it calls ECR-related deposit costs. And a part of its lending goes to other finance companies, which is where both of its recent loan write-offs came from (section 8).
| Quarter to September 30, 2026 | Amount | Against a year earlier |
|---|---|---|
| Net income | $277.2M | +6.4% (from $260.5M) |
| Diluted earnings per share | $2.45 | +7.5% (from $2.28) |
| Net revenue | $1,014M | +8.1% (from $938.2M) |
| Net interest income | $807.6M | +7.6% (from $750.4M) |
| Net interest margin | 3.57% | 3.53% a year earlier |
| Provision for credit losses | $80.0M | $80.0M a year earlier |
| Net charge-offs, annualized | 0.30% of loans | 0.22% a year earlier |
| Nonaccrual loans | 0.79% of funded loans | 0.92% a year earlier |
| Loans held for investment | $61.5B | +8.7% |
| Deposits | $81.8B | +5.8% |
| Return on tangible common equity | 15.5% | 15.6% a year earlier (company measure) |
| Tangible book value per share | $62.22 | +6.3% (from $58.56) |
| Common equity tier 1 ratio | 10.9% | 11.3% a year earlier |
| Share repurchases | $92.1M | 1.15M shares at $79.78 |
Source: the third-quarter release (8-K Exhibit 99.1, October 19, 2026). Deposits were flat from the second quarter: the bank moved out $4.5 billion of higher-cost deposits over two quarters, it says by choice, and replaced them with growth in commercial deposits. The CEO, Kenneth A. Vecchione, called the 0.30% charge-off rate “the midpoint of our 2026 guidance range.”
| Date | Close | Event | Source |
|---|---|---|---|
| January 14, 2022 | $122.35 | Closing high of the last five years | Market data |
| March 8 to 13, 2023 | $71.56 to $26.12 (−63.5%) | Silicon Valley Bank fails on March 10; depositors pull money from banks that look like it | Market data; FDIC |
| May 4, 2023 | $18.20 | Closing low, three days after First Republic Bank was seized and sold | Market data; FDIC |
| July 16, 2024 | $73.71 | First close above the March 8, 2023 price | Market data |
| October 16, 2025 | $78.84 to $70.32 (−10.8%) | Describes its fraud lawsuit against a borrower, Cantor Group V, in answer to investor questions after another bank’s filing | 8-K (Regulation FD) |
| February 9, 2026 | $96.08 | Closing high of the last 52 weeks | Market data |
| February 27, 2026 | $90.06 to $80.32 (−10.8%) | No company announcement that day. The 10-Q later says the bank learned in late February that a loan would not be repaid as agreed; the cause of this day’s fall is not established | Market data; 10-Q |
| March 6, 2026 | $80.74 to $73.91 (−8.5%) | Announces a $126.4 million write-off on a loan backed by First Brands receivables and its lawsuit against Jefferies and Leucadia Asset Management | 8-K and release |
| March 18, 2026 | $66.70 | Closing low of the last 52 weeks | Market data |
| October 20, 2026 | $73.63 to $75.30 (+2.3%) | Third-quarter results, released after the close on October 19 | Release |
| November 3 to 5, 2026 | $76.77, $79.24, $75.88 | Midterm election week; see below | Market data |
| November 6, 2026 | $75.55 | Date of value | Market data |
At the date of value the stock was 38% below its January 2022 high, 21% below its February 2026 high, down 10.1% this year and down 4.0% over twelve months. Over the same twelve months the regional bank fund (KRE) was up 20.0%. On the three largest down days in the table the regional bank fund fell too, and Western Alliance fell further: October 16, 2025 (−10.8% against −6.2% for the fund), February 27, 2026 (−10.8% against −5.1%) and March 6, 2026 (−8.5% against −2.5%). Two of those days carried news of one of its two problem loans; the cause of the February 27 fall is not established.
Americans voted on Tuesday, November 3. By the night of November 4, Democrats had won the House and at least 54 Senate seats, with two races uncalled; the Republican president keeps the veto, with a term that runs to January 2029 (CBS News, MS NOW). The market moved twice:
| Day | What happened | Western Alliance |
|---|---|---|
| Tuesday, November 3 | Election day | $76.77 |
| Wednesday, November 4 | The day after the vote. The financials fund (XLF) rose 3.5% and the regional bank fund (KRE) 1.7%. Oil also fell 8.7% that day on hopes of an end to the Iran war (Travis Valuation workfile, November 5) | $79.24 (+3.2%) |
| Thursday, November 5 | The S&P 500 fund (SPY) fell 4.4% | $75.88 (−4.2%) |
| Friday, November 6 | Date of value | $75.55 (down 1.6% from election day) |
Nothing the bank reported changed on any of those days. Western Alliance was on the shortlist for this issue on Monday, November 2, the day before the vote (section 11). It was chosen on Friday, November 6, after the week’s other earnings reports, and the result did not change the reasons for it.
Less than the headlines suggest. Most of the rules a bank lives under are set by the Federal Reserve, the FDIC and the Comptroller of the Currency, whose leaders the president nominates and the Senate confirms. A new banking law needs the House, the Senate and the president’s signature, or two-thirds of both chambers to override a veto. What changes when the new Congress sits on January 3, 2027 is oversight: the Senate Banking Committee passes to a Democratic chair, holds the hearings and votes first on any new regulator the president nominates. Tougher hearings are likely. A rewrite of the rules a bank like this one lives under is unlikely before January 2029. That is the author’s reading of how the system works, not a forecast of any bill.
Silicon Valley Bank failed on March 10, 2023, and depositors pulled money from banks that looked like it. Western Alliance was one. Its deposits fell from $53.6 billion to $47.6 billion in the first quarter of 2023, 11.3%, and its shares fell from $71.56 on March 8 to $26.12 on March 13. They reached $18.20 on May 4, three days after First Republic Bank was seized and sold, 75% below the March 8 close.
What the filings show for that year:
That is one test, passed once. It does not prove the next one would go the same way, and the bank that came through it is larger and lends to different borrowers than it did then.
Earnings per share rose from $2.03 in 2015 to $8.73 in 2025, with a dip in 2023 and no loss in any year. Over the last four quarters the bank earned $9.05 a share: $2.59, $1.65, $2.36, $2.45. The first quarter of 2026 was the low one because it carried the $126.4 million charge-off in section 8. The bank said in March it would offset most of that charge with gains from selling securities and with expense cuts; it booked $50.5 million of securities gains in the first nine months (10-Q).
| From | Quarterly dividend |
|---|---|
| Q3 2019 | $0.25 |
| Q3 2021 | $0.35 |
| Q3 2022 | $0.36 |
| Q4 2023 | $0.37 |
| Q4 2024 | $0.38 |
| Q4 2025 | $0.42 |
| Q4 2026 | $0.46 |
Western Alliance declared its first dividend in 2019 and has not cut it. It held the rate through 2020 and through the 2023 run, and has raised it every year since 2021. The latest, $0.46 a share, was declared on October 30, 2026, payable November 27 to holders of record on November 12 (8-K). At $1.84 a year it is 20% of the last four quarters’ earnings.
The bank also buys back stock under a $300 million program. In the first nine months of 2026 it bought 1.9 million shares at an average of $76.62, $145.7 million in all (10-Q). Shares outstanding fell 2.0% in a year, from 110.2 million to 108.0 million, and were 107.55 million on October 26.
| Measure | Reading | Note |
|---|---|---|
| Price to earnings, last four quarters (GAAP $9.05) | 8.3× | Graham’s ceiling is 15. EPS is the sum of the four quarters’ diluted EPS |
| Earnings yield | 12.0% | Against a 10-year Treasury yield of about 4.86% |
| Price to book ($68.14 a share) | 1.11× | Graham’s ceiling is 1.5; the product with P/E is about 9.3 |
| Price to tangible book ($62.22 a share) | 1.21× | Book value less goodwill and intangibles |
| Return on tangible common equity, third quarter | 15.5% | The bank’s own non-GAAP measure |
| Dividend yield | 2.4% | $0.46 a quarter from November; 20% of trailing earnings |
| Graham Number (app) | $118.22 | √(22.5 × EPS × book), 2025 annual report |
| Earnings power value, A (app) | $97.00 | 2025 EPS of $8.73 capitalized at 9% |
| Earnings power value, B (app) | $118.14 | Seven-year average EPS capitalized at the AAA bond yield |
| Average of the three (app headline) | $111.12 | The price is 32% below it |
| Bank lens: justified price to book (app) | $135.01 | Fair P/B of 1.90 on a five-year normal return on equity of 17.1% and a 9% required return; range $116.93 to $163.42 |
| Bank lens at the last four quarters’ return on book | $100.56 | Return of about 13.3% ($9.05 on $68.14 of book), 9% required, no growth; the author’s arithmetic with the app’s formula |
| At 1.7× tangible book | $105.77 | About the price reported in two large 2025 bank takeovers (section 6 table) |
| Deal | Price to tangible book | Source |
|---|---|---|
| PNC / FirstBank (Colorado), 2025 | about 2.3× | S&P Global Market Intelligence, quoted in PNC’s Form 425 filing |
| Fifth Third / Comerica, announced October 2025 | about 1.7× | Press reports (secondary) |
| Huntington / Cadence, announced October 2025 | about 1.7× | American Banker (secondary) |
These are prices paid for control of an entire bank, which usually carry a premium over the market price of a single share, and nobody has reported a bid for Western Alliance. They are recorded here as evidence of what banks of this kind change hands for, not as a price anyone has offered.
Reading the spread. For Western Alliance the app’s headline is the average of the three methods that assume no growth: the Graham Number and both earnings power values. All three sit above the price, and their average is $111.12. No growth rate is needed for the case. The app reads the 2025 annual report, so these rest on 2025 earnings of $8.73 a share, below the $9.05 earned over the last four quarters, a period that includes the $126.4 million write-off. Its bank lens, which values book value at the bank’s five-year average return on equity of 17.1%, gives $135.01. At the last four quarters’ return on book, about 13.3%, the same formula gives about $100.56. The lowest of the measures, the earnings power value at a 9% cost of capital, is $97.00. The price sits above tangible book and below every one of them.
| Test | Western Alliance | Result |
|---|---|---|
| Adequate size | Market value about $8.1B | Pass |
| Current ratio of 2 or more | Not meaningful for a bank, whose deposits are its raw material | Not applied |
| Long-term debt below net current assets | Not meaningful for a bank, for the same reason | Not applied |
| Positive earnings in each of the last ten years | 2016 to 2025, and every quarter of 2023 | Pass |
| Twenty years of uninterrupted dividends | First dividend declared in 2019 | Fail |
| Earnings per share up a third over ten years | $2.50 (2016) to $8.73 (2025) | Pass |
| Price to earnings of 15 or less | 8.3× | Pass |
| Price to book of 1.5 or less | 1.11× (product with P/E about 9.3) | Pass |
Western Alliance passes five of the six tests that apply to a bank. The two balance-sheet tests were written for companies that hold inventory and owe suppliers; for a bank, whose deposits are its raw material, they do not measure what they were meant to. The dividend test fails because the first dividend came in 2019.
Warning signs. None of the app’s warning signs is triggered on the 2025 annual report: net income is positive, EPS, revenue and book value per share did not decline over three years, the dividend was not cut, and debt does not exceed equity. The app flags Western Alliance as a financial company and sets aside the Altman Z-score, the Beneish M-score and the acquirer’s multiple, which were built for industrial companies.
| September 30, 2026 | Amount | Note |
|---|---|---|
| Deposits | $81.8B | +5.8% in a year; loans are 75.3% of deposits |
| Loans held for investment | $61.5B | +8.7% in a year |
| Total equity | $7.9B | Includes $295M of 4.25% preferred stock |
| Common equity tier 1 ratio | 10.9% | 11.3% a year earlier |
| Tangible common equity to tangible assets | 6.9% | 7.1% a year earlier |
| Allowance for credit losses | 0.93% | Of funded loans; 118% of nonaccrual loans |
| Nonaccrual loans | 0.79% | Of funded loans; 0.92% a year earlier |
| Non-owner-occupied office loans | $2.3B | 3.7% of loans; $387M due in the rest of 2026 |
| Foreclosed property | $165M | 27 properties, mostly offices by value ($137M and 15 properties at December 31, 2025) |
Sources: the third-quarter release and 10-Q. Gross charge-offs on non-owner-occupied commercial property loans were $85.4 million in the first nine months of 2026. The bank says it is holding the foreclosed offices to stabilize leasing before selling them, and that commercial property conditions “may worsen” (10-Q).
Cantor Group V. In August 2025 the bank sued Cantor Group V, LLC and individual guarantors in Los Angeles Superior Court, alleging fraud by the borrower in failing to provide collateral loans in first position on a $98.5 million credit line secured by commercial property loans. It holds a limited and a full guaranty from two ultra-high-net-worth individuals that apply in cases such as fraud. The facility went to nonaccrual at September 30, 2025 with a $29.6 million reserve, and $26.1 million was charged off in the first quarter of 2026 (10-Q). The bank first described the case publicly on October 16, 2025, “in response to investor inquiries about a recent peer bank 8-K filing” (8-K).
Leucadia Asset Management and Jefferies. The bank made a trade finance loan secured by receivables its borrower had bought from First Brands Group, which filed for bankruptcy in September 2025. After servicing failures, including lapsed filings that secure the collateral, the loan defaulted and the bank signed a forbearance agreement in October 2025 under which the defendants agreed to repay it by March 31, 2026. Payments stopped after $42.13 million on January 15, 2026. On March 6 the bank said it had been informed by Jefferies that the remaining $126.4 million would not be paid as agreed. It had concluded on March 2 that the balance would be charged off, and it charged off the full $126.4 million in the first quarter. The same morning it sued Jefferies Financial Group, Leucadia Asset Management and affiliates in New York Supreme Court, alleging breach of contract and fraud; an amended complaint followed in May (8-K; 10-Q). Any recovery will be recognized only when realized or realizable.
Together the two charge-offs come to $152.5 million before tax, about $1.41 a share and 2.3% of tangible common equity at September 30, 2026.
Kenneth A. Vecchione is chairman, president and chief executive officer (release). No Western Alliance director or officer bought shares on the open market in the twelve months to the date of value. The sales in that period, from the Form 4s on EDGAR:
| Date | Who | What |
|---|---|---|
| June 9, 2026 | Dale Gibbons, Vice Chair and Chief Banking Officer, Deposits | Sold 40,000 shares at $81.16 to $82.64, about $3.3M |
| June 8, 2026 | Ben Mucha, Chief Accounting Officer | Sold 5,946 shares at $81.00 |
| February 18, 2026 | Ben Mucha, Chief Accounting Officer | Sold 641 shares at $95.62 |
| December 15, 2025 | Marianne Boyd Johnson, director | Sales at $86.50 to $87.95 |
The Form 4s examined do not say whether the sales were under pre-arranged trading plans. Most other insider filings in the period record awards, conversions of stock units and shares withheld for tax under the bank’s compensation plans.
This issue followed a screen of about 430 companies run through the app at the October 30 close (on November 2, 2026), rechecked after the November 5 earnings reports, and a screen of 126 technology companies at the November 5 close.
Each reason below is dated to this week’s prices and filings. If one of these companies is picked later, that letter will open with what changed.
The author does not own Western Alliance and will not buy any until after the letter accompanying this workfile has gone out. He owns shares of VICI Properties, Lennar, Amazon, Walmart, Costco, TD, Scotiabank, Dick’s, Berkshire Hathaway and OMAB, all named in past issues.
The position taken here: at the date of value Western Alliance was priced at 8.3 times earnings and 1.21 times tangible book, below the prices reported in recent bank takeovers and below every value method the app runs on it, after two loan write-offs that together cost about 2.3% of its tangible common equity before tax. It came through a deposit run in 2023 without a loss or a dividend cut. The condition to watch is credit: the next loss has to stay small.