Silvergate gears up to lay off 230 employees while initiating NYSE delisting procedure.

2023-05-12

Summary: - Silvergate Capital, the parent company of defunct Silvergate Bank, is delisted from the NYSE and has disclosed significant staff cuts. - The company stated that 230 staff will be let go, and more cuts are scheduled for the future. - After the staff cut, about 80 employees will be left to continue the bank's liquidation process. - Silvergate estimated that staff drawdown costs would be around $13.6 million. - The company stated it would be unable to file legally required financial reports and doesn't expect to be able to file any similar reports in the future. - The firm cited challenges related to regulatory inquiries and investigations and liabilities from legal action and the bank's liquidation process. - Silvergate determined it's in the "best interests" of stakeholders to "minimize costs and expenses" to preserve value. - Crypto firms, including Gemini and Coinbase, severed ties with Silvergate Bank earlier this year as it faced a Justice Department investigation over alleged ties to the collapse of FTX.

Full article:

The parent company of the defunct Silvergate Bank disclosed significant staff cuts and the delisting of its securities in an SEC filing.

The parent company of the collapsed Silvergate Bank will be delisted from the New York Stock Exchange (NYSE) and 230 staff will be let go, Silvergate Capital has disclosed.

In a May 11 filing to the Securities and Exchange Commission (SEC), Silvergate Capital said 230 staff will be “separated” starting May 12. The NYSE also suspended trading in its stock with delisting to commence “shortly.”

A year-to-date chart of Silvergate Capital’s share price shows a nearly 93% price drop since the start of 2023. Source: Google Finance

After the staff cut “approximately 80 officers and employees” will be left behind to continue Silvergate Bank’s liquidation process.

More cuts are on the horizon. At least three more headcount cuts are slated for June 30, Aug. 30 and Nov. 30 “or later” the filing states.

Silvergate estimated staff drawdown costs would land around $13.6 million with expenses on severance, retention and bonus pays along with job placement programs.

No more financial updates

In a separate May 11 SEC filing, Silvergate said it’s unable to file legally required financial reports for the 2022 fiscal year and the first quarter of 2023 and “does not expect to be able” to file any similar reports in the future.

The firm cited “challenges” due to “continuous developments relating to the regulatory and other inquiries and investigations that are pending,” and liabilities from legal action and the bank’s liquidation process.

Silvergate determined it’s in the “best interests” of stakeholders to “minimize costs and expenses” to preserve value. Some of the staff to be cut include those that are “critical” in preparing these filings, the firm added.

GAO cites exposure to digital assets in exploring collapse of Signature Bank

On March 8, Silvergate Capital first announced it would voluntarily liquidate Silvergate Bank.

Days earlier, a line-up of crypto firms including Gemini, Coinbase, Galaxy Digital and BitStamp severed ties with the bank as it faced a Justice Department investigation over alleged ties to the collapse of FTX.

Magazine: Unstablecoins: Depegging, bank runs and other risks loom



Source: cointelegraph.com

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