Silvergate Capital Corp. stock is down 45% in premarket trades on Thursday after the company delayed its financial statements and said it’s evaluating its ability to continue operating for next 12 months, as the crypto asset bank scrambles to cover withdrawals tied to the crypto market meltdown. Silvergate Capital
SI,
-2.73%
said it expects to record further losses related to its impairment on its securities portfolio, after it sold additional debt securities to cover withdrawals.
Silvergate Capital stock dropped to about $8 a share, a level not seen since March, 2020, with at least one analyst downgrading the stock. Silvergate disclosed in a filing an unaudited loss of $948.7 million in 2022, compared to net income of $75.5 million in 2021. It does not expect to be in a position to file audited results by the extended date of March 16, the company said. “The company is evaluating the impact that these subsequent events have on its ability to continue as a going concern for the twelve months following the issuance of its financial statements,” Silvergate said. JPMorgan analyst Steven Alexopoulos downgraded Silvergate to underweight from neutral and withdrew a price target for the company. Silvergate realized $886 million in losses from selling securities, as crypto-related deposits fell 68% to $3.8 billion in its fourth-quarter, as the company announced in January. “With the company having sold additional securities (beyond what was guided) at a loss in January/February, this reflects that the company is facing continued liquidity challenges,” Alexopoulos said. Wedbush analyst David Chiaverini cut his price target on Silvergate stock to $9 from $13 and reiterated a neutral rating on Silvergate Capital to reflect a “lack of near-term positive catalysts and believe the crypto market could remain suppressed with elevated interest rates for the next couple quarters” until a pause in rate increases by t …