A Pacific Western Bank branch in Los Angeles, California, US, on Friday, March 10, 2023.

Eric Thayer | Bloomberg | Getty Images

PacWest Bancorp shares tumbled 56% in extended trading on Wednesday following news that the bank is weighing strategic options.

The regional bank is assessing options, including a possible sale, and bringing in advisors to evaluate longer-term plans for the business, CNBC confirmed, according to one person familiar with the matter. Piper Sandler and Stephens are the two firms advising PacWest, the person said.

Bloomberg first reported that the bank was exploring options late Wednesday.

The shares of many West Coast regional banks have been hit particularly hard since the collapse of Silicon Valley Bank in March, in part because of concerns that their customer bases are similar. This week, First Republic Bank was seized by regulators and sold to JPMorgan Chase.

The Los Angeles-based PacWest has a roughly $750 million market cap, and is down by 72% this year. On Wednesday, PacWest shares declined nearly 2% during the regular session, and notched their fifth straight losing day.

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PacWest shares 1-day

Other regional banks declined in extended trading following the report, with the SPDR S&P Regional Banking ETF shedding 5.3%. Shares of Western Alliance Bancorp dropped 27%, while Comerica slid 10%. KeyCorp shares fell 7%.

PacWest reported that total deposits declined more than $5 billion in the first quarter to $28.2 billion as of March 31. However, the company said that it saw a net gain of $1.1 billion in deposits from March 20 until quarter end.

PacWest also said that deposits grew by another $700 million from March 31 through April 24.

A PacWest spokesperson did not immediately respond to a request for comment.

— CNBC’s Jesse Pound contributed reporting.

Correction: A source familiar told CNBC that the regional bank’s options include a potential sale – not a capital raise.