Silvergate has suspended dividend payouts to maintain a “strong capital position,” but stressed it does have funds in excess of customer deposits.
California-based crypto bank Silvergate has suspended dividend payouts to preserve its “highly liquid balance sheet.”that it is halting “the payment of dividends on its 5.375% Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series A, in order to preserve capital.”, but did stress that it still maintains a “cash position in excess of its digital asset customer-related deposits.”
“This decision reflects the Company’s focus on maintaining a highly liquid balance sheet with a strong capital position as it navigates recent volatility in the digital asset industry.” “The Company’s Board of Directors will re-evaluate the payment of quarterly dividends as market conditions evolve,” the firm added.in its Q4 2022 report on Jan. 17. Silvergate attributed its poor performance to the overall sour market sentiment which has seen investors opt for a “risk-off” approach over the past year.
In the Q4 report, Silvegate CEO Alan Lane also used similar language to the latest announcement, noting that the company is still bullish on the crypto sector but is working to maintain “a highly liquid balance sheet with a strong capital position.” The news of suspended dividends on Friday was met with notable losses in both its preferred and common stock prices.
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