Crypto-friendly Signature Financial institution “considerably’ in the reduction of on digital asset deposits within the wake of elevated volatility and regulators’ considerations on the finish of final yr, mentioned the previous chairman and co-founder of the now-shuttered financial institution.
“Sadly, a sequence of really extraordinary and unprecedented occasions unfolded shortly,” mentioned Scott Shay, Signature’s former co-founder and chairman in ready testimony on Monday.
Shay is about to testify in entrance of the Senate Banking Committee on Tuesday morning, together with former Signature Financial institution President Eric Howell and former Silicon Valley Financial institution CEO Gregory Becker.
Silicon Valley Financial institution, or SVB, failed days earlier than Signature Financial institution in March of this yr.
Regardless of different banks’ failures and Signature’s depositors withdrawing billions, Shay mentioned he was nonetheless assured in Signature Financial institution.
“The financial institution was well-capitalized. The financial institution was solvent – certainly, it was at all times solvent, with property properly in extra of liabilities even on the very finish. And the financial institution had a well-defined and stable plan to proceed in operation and stand up to extra withdrawals.”
The New York Division of Monetary Providers announced on March 12 that it had taken possession of Signature Financial institution to guard depositors.
Shay mentioned he disagreed with the regulator’s choice.
“Though I disagreed with this choice, I acknowledge the vital position that financial institution regulators play in our monetary system,” Shay mentioned.
Days inside one another in March, three crypto and tech targeted banks failed together with Signature Financial institution, SVB and Silvergate Capital.
The collapse of these banks hit the crypto trade onerous, with some blaming the federal government for deliberately targeting the crypto sector with financial institution closures.
NYDFS Superintendent Adrienne Harris pushed again on that sentiment, talking on Signature Financial institution at a convention final month.
“The concept the taking possession of Signature was about crypto and that is ‘Choke Level 2.0’ is absolutely ludicrous,” Harris was quoted as saying on the conference.