Bernard Von Gizycki's questions to WESTERN ALLIANCE BANCORPORATION (WAL) leadership • Q3 2025
Question
Bernard von Gizycki inquired about the composition of Western Alliance Bancorporation's deposit base, specifically the ECR-related costs (representing 30% of total expenses), and expectations for changes, including efforts to reduce ECR balances or costs.
Answer
CFO Dale Gibbons explained that ECRs are primarily driven by mortgage warehouse and homeowners association (HOA) deposits. He anticipates that HOA deposits, while not shrinking, will grow slower than overall company footings, causing their proportion to decline. Mortgage warehouse deposits are expected to keep pace. Overall, ECRs will become less significant, and costs will fall with lower rates. In a follow-up on equity income, President and CEO Ken Vecchione clarified that the Q1 losses have not yet reversed. The Q3 uptick was due to "other types of things," and he expects a "haircut" going forward, with no dramatic improvement or worsening anticipated.