.jpmorgan said that silvergatebank saw worse than expected deposit outflows in the 4Q driven by the collapse of previously trusted players and short-sellers, in a report downgrading the stock to neutral with a $14 price target. By willcanny99
Join the most important conversation in crypto and Web3 taking place in Austin, Texas, April 26-28.Silvergate Capital witnessed worse than expected deposit outflows in the fourth quarter and the financial impacts of these outflows will have implications on long-term profitability, JPMorgan said in a research report on Friday.
JPMorgan downgraded the stock from “overweight” to “neutral” and slashed its price target for the company to $14 from $30. Shares of Silvergate Capital fell over 10% in premarket trading to $11.21, having already fallen nearly“While the challenging backdrop for the crypto settlement business was a factor in the worse than expected results being released, we also believe that concerns voiced by short-sellers likely also contributed to Silvergate’s customers withdrawing deposits from the platform at a greater than anticipated level,” analysts led by Steven Alexopoulos wrote.
JPM says it expects deposit balances to normalize to late 2020 levels, but cautions that they could normalize at much lower levels as crypto customers have moved to a “risk-off” position and are sitting on the sidelines.
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