US regional banking crisis reappears? A small bank makes 50 million dollar impairment

On October 17, the crisis of regional banks in the United States has dragged down the stock price of banks. Two American banks have said that they have been defrauded when providing loans to funds that invest in bad commercial mortgages, heightening market concerns about the credit crisis. Zions Bancorp shares fell as much as 15%. The company disclosed that a loan underwritten by its wholly-owned subsidiary, Bank of California and Trust of San Diego, took a $50 million impairment charge. Western Alliance Bancorp shares fell as much as 13%. The company also said it had provided loans to the same borrower. Zions said in a lawsuit that Bank of California and Trust were defaulted on payments by two investment funds linked to Andrew Stupin and Gerald Marcil, among others. According to the lawsuit, Bank of California & Trust provided these borrowers with two revolving credit lines totaling more than $60 million in 2016 and 2017 to finance their purchase of distressed commercial mortgages. But after investigation, the bank found that many of the notes and related properties had been transferred to other entities. According to the lawsuit, these properties have been confiscated and are about to be confiscated. Affected by this news, the US KBW Bank Index closed down 3.6%.