April 25 (Reuters) - PacWest Bancorp beat estimates for first-quarter profit on Tuesday, as the regional lender managed to stabilize deposit outflows after two bank collapses last month triggered the biggest crisis to hit the sector since 2008.
Shares in PacWest, down 55% so far this year, rose 15% in extended trading after results.
The crisis led to worried customers in the United States moving capital to bigger banks that are considered "too-big-to-fail" or sought higher yields in money market funds.
PacWest's total deposits were down nearly 17% at $28.19 billion in the first quarter ended March 31, compared with $33.94 billion at the end of the fourth quarter.
Still in a bright spot for the bank, this marked an increase of $1.1 billion from its last update of $27.1 billion on March 20.
"Our deposits have stabilized with total insured deposits increasing from 48% of total deposits at year-end to 71% of total deposits at March 31" said CEO Paul Taylor in a statement.
"In light of the recent events, management took immediate steps to maximize liquidity, including the exploration of strategic asset sales, which has led to the transfer of our $2.7 billion Lender Finance loan portfolio to held for sale," Taylor added.
PacWest posted adjusted earnings of $89.4 million, or 66 cents per share, in the January- March period, beating estimates of 61 cents per share, according to Refinitiv IBES data.
The bank said it took a non-cash goodwill impairment of $1.38 billion in the reported quarter as recent market volatility led to a decline in its stock price.
The results come at a time when regional lenders in the U.S. are facing the twin task of assuring customers their deposits are safe and investors that there is no liquidity crunch.
Last month, PacWest said it had raised $1.4 billion from investment firm Atlas SP Partners, as the crisis-hit sector scrambled to limit the damage from the collapses. (Reporting by Manya Saini in Bengaluru; Editing by Maju Samuel and Shailesh Kuber)
