Silvergate Bank Plunges 40% as Financial Crisis Looms After Delayed Annual Report

Silvergate Bank is facing a financial crisis as its stock dives 40% after the company delayed its annual report and revealed new losses.

The San Diego-based bank, which specializes in cryptocurrency, reported a new loss of $7.1 million for the fourth quarter of 2020, which was significantly higher than the $2.6 million reported in the same quarter of 2019. The bank also said it was delaying the filing of its annual report in order to assess its viability.

The news sent shares of Silvergate tumbling, with the stock closing down 46% on Thursday. This marks the second consecutive day of losses for the company, as the stock dropped 8.3% on Wednesday after the bank announced it was delaying its annual report.

The announcement also caused a ripple effect in the crypto banking industry, with other stocks such as Signature Bank and Metropolitan Bank also falling.

Silvergate CEO Alan Lane said in a statement, “We are conducting a comprehensive review of our operations and financial position and taking steps to ensure that we are well-positioned for the future. We remain confident in our long-term prospects and our ability to continue to serve our customers.”

The bank’s stock has dropped more than 70% since the start of 2021, and analysts are warning investors to stay away from the stock until the bank’s financial situation becomes clearer.