- Silvergate Capital’s shares have lost almost 93% of their value so far this year
- 230 staff will be laid off, more to follow
Silvergate Capital, the parent company of the defunct Silvergate Bank, will start the process of delisting from the New York Stock Exchange. It will also cut 230 employees, Cointelegraph reported.
The process of “separating” the 230 staff will start today according to a May 11 filing to the US Securities and Exchange Commission (SEC) by Silvergate Capital. Delisting will start shortly and the NYSE has terminated Silvergate stock trading.
80 staff left, shares lost 93% this year
Silvergate Capital’s shares have lost almost 93% of their value so far this year. After the layoffs, around 80 officers and employees will remain to manage the bank’s liquidation process.
What’s more, additional layoffs are expected. The filing states that there will be at least three more series of layoffs, scheduled on June 30, August 30, and November 30 “or later.”
Layoffs will cost Silvergate $14M
The estimated staff layoff costs will cost the company $13.6 million with expenses for bonus payments, severance payments, and retention as well as employment placement programs.
However, it appears Silvergate has more to gain from the cuts. They have found minimizing costs this way to be in the “best interests” of stakeholders.
No more financial reports
In addition, Silvergate will no longer be able to issue financial updates. In a separate SEC filing yesterday, the company stated it could not file the financial reports required by law for the 2022 fiscal year and the first quarter of this year. They don’t expect “to be able” to file such reports moving forward.
The company cited “challenges” arising from liabilities from lawsuits and the bank’s liquidation process as well as “developments” related to regulatory and other pending inquiries and investigations.
A series of bankruptcies in the crypto industry
The failed bank’s parent company announced it would voluntarily liquidate it on March 8. A number of crypto exchanges, including Gemini and Coinbase, cut ties with the bank on news that it was facing an investigation by the DoJ over alleged ties to the collapse of FTX. Voyager Digital also announced bankruptcy this year.
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