Western Alliance shares, which are down 40% year-to-date, surged 13% , erasing losses recorded over the last two weeks. Other regional lenders were also trading higher.

Regional banks, the largest lenders to the beleaguered U.S. commercial real estate and construction markets, have reduced their exposure to the sector by tightening standards and making fewer loans, according to a Reuters analysis.

Their tightening comes as many real estate borrowers face challenges making interest payments in a rising interest rate environment, while office use has declined and property values have decreased on recession concerns.