• Silvergate Bank’s stock price fell by more than 30% in after-hours trading after announcing a delay in releasing its annual 10-K report.
• The SEC requires a 10-K report to provide an overview of the company’s financial situation and operations.
• Silvergate reported a $1 billion net loss and $14 billion reduction in customer deposits in the fourth quarter of 2022.
Silvergate Stocks Tumble by 30%
Silvergate Bank’s stock price fell by more than 30% in after-hours trading after announcing a delay in releasing its annual 10-K report, which is required by the Securities and Exchange Commission (SEC). The 10-K report provides an overview of a company’s financial situation and operations.
Financial Losses for Silvergate
In the fourth quarter of 2022, Silvergate reported a $1 billion net loss and $14 billion reduction in customer deposits due to the „planned reduction in digital asset banking deposits“ and market turmoil. As result, Silvergate turned to the Federal Home Loan Bank (FHLB) for a $4.3 billion loan in January.
Additional Steps Being Taken
Silvergate is currently going through additional steps to complete certain audits requested by their independent certified public accounting firm. They are assessing how these events have impacted their ability to continue as a “going concern” for the next 12 months upon publishing their financial statements.
Impact on Regulatory Capital Ratios
The additional losses could negatively affect regulatory capital ratios of both Silvergate Corporation and its wholly owned subsidiary, Silvergate Bank, resulting in both being less than well-capitalized.
Reevaluating Business Strategies
Silvergate is reevaluating its business strategies due to current market challenges that it faces. They are taking extra steps to ensure that all necessary information is included regarding their financial situations so investors can make informed decisions about investing or not investing with them according to their own risk assessments.