Silvergate Capital Slumps 11% After Suspending Dividends

• Crypto-friendly bank Silvergate announced its suspended payment of dividends on its series A preferred stock.
• Silvergate reported a $1 billion loss in the fourth quarter and also cut its staff by 20% amid the crypto bear market and impact of FTX collapse.
• Following Friday’s news, shares of parent company Silvergate Capital (NYSE:SI) fell more than 11% in early morning trading, hitting lows of $12.55.

Crypto-friendly bank Silvergate recently announced that it has suspended payment of dividends on its series A preferred stock. The decision was due to the turbulence the company has faced in the crypto ecosystem, including a $1 billion loss in the fourth quarter and a 20% staff cut in response to the bear market and the fall of crypto exchange FTX.

The news of the suspension has had a dramatic effect on the company’s shares, with parent company Silvergate Capital (NYSE:SI) falling more than 11% in early morning trading and hitting lows of $12.55. Despite having seen a decent run of growth recently, the current market conditions have put a strain on the company’s capital reserves and shareholders are feeling the effects.

In order to ensure that the company is able to remain liquid and maintain its capital position in the face of the ongoing volatility, the Board of Directors has made the decision to suspend dividend payments. However, the board has stated that they will re-examine the payment of quarterly dividends at a later date, depending on how market conditions evolve.

Silvergate has been one of the most prominent crypto-friendly banks in recent years, providing services such as custody, payments and trading to its customers. While the current market situation has presented some challenges for the company, it remains to be seen how the situation will develop over the coming months. Hopefully, the company will be able to weather this storm and emerge in a stronger position.