Silvergate Capital suffers $1 billion loss in fourth quarter of 2022

While Silvergate has taken steps to help it navigate the current environment, according to CEO Alan Lane, the company remains “Focused on providing value-added services for its core institutional clients“.

Crisis of confidence

Less than a month after Silvergate Bank reported a massive drop in customer deposits, the parent company of the crypto-currency-focused financial institution, Silvergate Capital Corporation, said on January 17 that a “transformational change” observed in the fourth quarter (Q4) had contributed to “create a crisis of confidence in the entire ecosystem.“This is what triggered the shift to a “risk-free position on digital asset trading platforms“, said the parent company.

Read:  Dramatic explosion in AI-related cryptos: Fetch and Singularity soared over 20% overnight!

As a result of the changing environment, Silvergate said the group incurred a net loss of $1.0 billion in the fourth quarter, or a loss of $33.16 per common share. The fourth-quarter performance contrasts with net income of $40.6 million, or $1.28 per diluted share, in the third quarter of 2022.

As a result of the massive losses in Q4, Silvergate Capital’s latest financial results show that for the full year of 2022, the group had an overall loss of $948.7 million or $30.07 loss per common share.

Silvergate Bank’s stock took a hit after it was revealed that customers of the crypto-currency-focused bank withdrew more than $8 billion in deposits in the fourth quarter alone.

Read:  Catalonia starts dispensing glucose meters for people with type 2 diabetes

Silvergate remains committed to maintaining a “highly liquid balance sheet.”

As a result, because of this, as well as the bearish conditions that have prevailed in the crypto market since May 2022, Silvergate said it was forced to sell debt securities at a loss of about $718 million. In addition, the bank said it would “take an impairment charge of $196 million” on the blockchain-based payment solution it acquired from Diem.

Commenting on the group’s latest financial results, Silvergate CEO Alan Lane said:

“While we are taking decisive steps to navigate the current environment, our mission has not changed. We believe in the digital asset industry, and we remain focused on providing value-added services for our core institutional clients. To that end, we are committed to maintaining a highly liquid balance sheet with a strong capital position.”

The Best Online Bookmakers April 11 2024

BetMGM Casino