Silvergate Capital Corporation saw its capitalization plummet by 48.82% on March 2, following the announcement of its delay in publishing its annual report to the SEC.
The company has attributed the delay to “additional time” needed to complete the audit, as well as “a number of circumstances” such as the sale of investment securities “in excess of what was previously expected and disclosed in the company’s earnings report,” and new bond issues in January and February 2023, which will likely result in losses.
These accounting losses may have a negative impact on the capital adequacy of both Silvergate Bank and its parent company.
The company has also noted that it is “currently reviewing certain regulatory and other requests, as well as investigations regarding its activities,” and is re-evaluating its business and strategies in light of the challenges it faces.
Coinbase has also announced that it would no longer accept and process payments in favor of Silvergate, in order to service its Prime customers.