Company: WAL-PA
Filing Date: 2025-02-25
Form Type: 10-K
Source: 0001212545-25-000090
Chunk: 87

Company: WESTERN ALLIANCE BANCORPORATION
Filing Date: 2025-02-25
Form: 10-K
Item: Item 7
Chunk 87
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 as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. 

Pre-Provision Net Revenue

Banking regulations define PPNR as the sum of net interest income and non-interest income less expenses before adjusting for loss provisions. Management believes this is an important metric as it illustrates the underlying performance of the Company, it enables investors and others to assess the Company's ability to generate capital to cover credit losses through the credit cycle, and provides consistent reporting with a key metric used by bank regulatory agencies. 

The following table shows the components used in the calculation of PPNR: 

Year Ended December 31,202420232022(in millions)Net interest income$2,618.9 $2,338.9 $2,216.3 Total non-interest income543.2 280.7 324.6 Net revenue$3,162.1 $2,619.6 $2,540.9 Total non-interest expense2,025.0 1,623.4 1,156.7 Pre-provision net revenue$1,137.1 $996.2 $1,384.2 Less:Provision for credit losses145.9 62.6 68.1 Income tax expense203.5 211.2 258.8 Net income$787.7 $722.4 $1,057.3 

Efficiency Ratio

The following table shows the components used in the calculation of the efficiency ratio, which measures non-interest expense as a ratio of net revenue on a tax equivalent basis. Management uses this ratio as a metric for assessing cost efficiency:

Year Ended December 31,202420232022(dollars in millions)Total non-interest expense$2,025.0 $1,623.4 $1,156.7 Less: Deposit costs693.2 436.7 165.8 Total non-interest expense, excluding deposit costs1,331.8 1,186.7 990.9 Divided by:Total net interest income2,618.9 2,338.9 2,216.3 Plus:Tax equivalent interest adjustment39.5 35.5 33.7 Total non-interest income543.2 280.7 324.6 Less: Deposit costs693.2 436.7