Signature Bank Reduces Crypto Holdings as Crypto Market Slide Continues


By Steve Gelsi

Signature Bank Books sees a sharp decrease in digital asset deposits but still has total deposits of $89 billion

As the crypto market continues to fall, the mid-quarter update of Signature Bank (SBNY.) was of particular interest.

The most recent report indicated a $1.5B reduction in digital asset deposits. The bank is deliberately reducing its exposure.

Investment banking analyst Casey Haire from Jefferies reaffirmed a Hold Rating on Signature Bank on Friday and stated that the mid-quarter update showcased an “orderly crypto unwind” at the company.

Haire suggested that the numbers portrayed in the update were not as bad as originally feared and that the decline of $3 billion to $5 billion speculated by management had been significantly slower than expected.

Unlike Silvergate Capital Corp. (SI), which stated this week that it may not be solvent within the next 12 months due to a decrease in deposits, Signature Bank remains in a strong financial standing.

Signature Bank’s stock dropped by 1% to $148.83 at the close of trading Thursday, following the release of the mid-quarter update.

In premarket trading on Friday, Silvergate Capital rose by 1.8% following a 58% decrease the previous session. As one of the S&P 500 components, Signature Bank has a wide-ranging banking division, as well as digital asset deposits. Unfortunately, its digital asset business has experienced a dip due to the current state of the crypto-market.

According to the company’s data, spot deposit balances dropped by $826 million. Nevertheless, its average deposit balance was still at $89 billion. Excluding the digital asset deposits, Signature Bank’s overall deposits went up by $682 million.

The firm also emphasized that it does not provide loans that are secured by digital assets nor does it finance against them.

Investor Sues SequoiaFTX had connections with other financial institutions as well.

-Steve Gelsi

(END) Dow Jones Newswires

03-03-23 0849ET

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

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