Silvergate Capital Plans to Wind Down Silvergate Bank, Shares Drop 39.5%

By Stephen Nakrosis

Silvergate Capital Corp. shares plunged 39.5% to $2.97 in after-hours trading Wednesday following news the company plans to voluntarily wind down and liquidate Silvergate Bank.

The stock closed the day's regular session with a 5.76% loss, finishing the day at $4.91 per share. Earlier Wednesday, shares touched a 52-week low of $4.57 each.

The La Jolla, Calif., bank, which is focused on the crypto currency market, ran into trouble when it delayed filing its annual report earlier this month. The company also said it was at risk of being "less than well capitalized" after recent events in that market.

"In light of recent industry and regulatory developments, Silvergate believes that an orderly wind down of Bank operations and a voluntary liquidation of the Bank is the best path forward," the company said. It added "the bank's wind down and liquidation plan includes full repayment of all deposits."

Earlier this month, the company made the decision to discontinue the Silvergate Exchange Network.

"All other deposit-related services remain operational as the company works through the wind down process," Silvergate said.

Silvergate Capital said it is "is also considering how best to resolve claims and preserve the residual value of its assets, including its proprietary technology and tax assets."

Write to Stephen Nakrosis at [e-mail]

(END) Dow Jones Newswires

March 08, 2023 17:15 ET (22:15 GMT)

Copyright (c) 2023 Dow Jones & Company, Inc.