PacWest Bancorp PACW Shares rise on Monday after the bank struck a deal Loan Purchase and Sale Agreement.
What happened: Pacific Western Bank has reached an agreement with a subsidiary of Kennedy-Wilson Holdings, Inc. to sell a portfolio of 74 home construction loans with approximately $2.6 billion principal balance, according to a new regulatory filing. Kennedy Wilson will also assume any remaining future funding obligations under the purchased loans.
Pacific Western Bank will also sell six additional real estate loans to Kennedy Wilson for a total principal amount of approximately $363 million.
The transaction is currently expected to close in multiple tranches during the second and early part of the third quarter.
The entire regional banking sector has been under severe selling pressure since March, when rising interest rates led to a run on Silicon Valley Bank, which eventually collapsed.
Shortly thereafter and earlier in the month, Signature Bank went under. JP Morgan acquired a substantial majority of the assets and assumed deposits from First Republic from the FDIC.
PACW price history: PacWest shares are down more than 72% year-to-date.
The stock is up 9.95% to $6.30 as of Monday morning Gasoline Pro.
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