BY CNA Team - November 22, 2018
Owner of crypto bank files for IPO
La Jolla, California-based Silvergate Capital Corp has filed for an initial public offering (IPO) with the New York Stock Exchange to raise up to US$50mil.
The company, founded in 2000, owns Silvergate Bank, which specialises in servicing crypto customers, and developed the Silvergate Exchange Network, a platform for US dollar-cryptocurrency transactions.
According to documents the company filed with the US Securities and Exchange Commission, the joint book-running managers for the IPO are Barclays and Keefe, Bruyette & Woods.
Silvergate intends to use the proceeds from the IPO to fund organic growth and for repayment of long-term debt, future acquisitions and other growth initiatives.
As of Sept 30, the main subsidiary Silvergate Bank has 483 customers comprising crypto exchanges, fund managers and family offices with US$1.7bil in non-interest-bearing deposits. It has three branches.
Funds from these deposits are deployed to a conservative portfolio of investments in cash, short term securities and certain types of loans that generate risk-adjusted returns.
Silvergate has US$950.32mil in cash and cash equivalents as of Sept 30, shareholders’ equity of US$204.32mil while the book value per share stood at US$10.30.
For the first nine months of 2018, the company posted net income of US$14.31mil, a 151% jump from the same period of last year while interest income for the period under review rose 48.6% to US$51.15mil.
Silvergate Bank has a Tier 1 leverage ratio to average assets of 9.12% while Tier 1 capital to risk-weighted assets stood at 22.72% as of Sept 30.
Image courtesy of Silvergate Bank website.