California-based crypto bank Silvergate has suspended dividend payments to preserve its “highly liquid balance sheet.”

In a Jan. 27 announcement, the firm said it will suspend “dividend payments on its 5.375% fixed-rate perpetual noncumulative preferred stock, Series A, to preserve capital.”

The company noted that it made the decision in order to weather the crypto winter storm, but emphasized that it still maintains a “cash position in excess of its digital asset customer-related deposits.”

“This decision reflects the Company’s focus on maintaining a highly liquid balance sheet with a strong capital position while navigating recent volatility in the digital asset industry.”

“The Company’s Board of Directors will reassess the quarterly dividend payment as market conditions evolve,” the firm added.

The announcement comes just 11 days after the company posted a sizeable $1 billion net loss in its fourth quarter 2022 report on January 17. Silvergate attributed its underperformance to general sour market sentiment that has prompted investors to take a risk-off approach. During the past year.

In the fourth quarter report, Silvegate CEO Alan Lane also used similar language to the latest announcement, noting that the company remains bullish on the cryptocurrency sector, but is working to maintain “a highly liquid balance sheet with a strong capital position.

News of the suspended dividend on Friday was met with notable losses in preferred (SI-PA) and common (SI) stock prices.

According to data from Yahoo Finance, the price of SI-PA fell 22.71% to $8.85, while SI declined 3.76% to $13.58 at market close.

Walking away also paints a bleak picture for SI-PA and SI, with share prices falling 60% and 87.46% in the last 12 months.

Related: US Home Loan Banks Lent Billions of Dollars to Crypto Banks: Report

This is not the only measure the company has taken to shore up its coffers this month, after it announced on January 5 that it had laid off 200 employees, representing 40% of its workforce, in an attempt to stay afloat. .

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