Silvergate Capital, the parent company of the now-defunct Silvergate Bank, has announced its impending removal from the New York Stock Exchange (NYSE) and the termination of 230 employees.
The company revealed in a May 11 statement to the U.S. Securities and Exchange Commission (SEC) that the layoffs would begin on May 12. The NYSE has already halted trading of its stock, with a formal delisting anticipated to follow soon.
Following these layoffs, approximately 80 personnel, including officers and employees, will remain to manage the bank’s liquidation process.
Additional layoffs are anticipated, with three more rounds of workforce reduction scheduled for June 30, August 30, and November 30, or potentially later, according to the filing.
The company anticipates that the cost of reducing its workforce will be around $13.6 million, including expenses related to severance packages, retention and bonus payments, and employment placement programs.
In another SEC filing on May 11, Silvergate disclosed that it is unable to submit the legally required financial reports for the 2022 fiscal year and the first quarter of 2023. It also stated that it does not foresee being capable of submitting similar reports in the future.
The company attributed this inability to ongoing regulatory inquiries, investigations, and liabilities arising from legal action and the bank’s liquidation process.
Silvergate affirmed that it is in the stakeholders’ best interests to cut costs and expenses, including the termination of employees critical to preparing these reports, to maintain value.
Silvergate Capital had previously declared on March 8 that it would voluntarily liquidate Silvergate Bank. A few days prior, several cryptocurrency firms, such as Gemini, Coinbase, Galaxy Digital, and BitStamp, had severed their relationships with the bank due to a Justice Department investigation into alleged connections with the downfall of FTX.
