SBNY - Signature Bank insiders sold over $100M in shares during crypto boom - report
2023-04-04 08:15:55 ET
In the years after Signature Bank ( OTC:SBNY ) shifted its focus to cryptocurrency, boosting its stock price, the company's insiders sold more than $100M of shares, the Wall Street Journal reported Tuesday.
Sales by the bank's chairman, its former CEO, and his successor made up about half of the amount sold in the past three years, according to the newspaper's analysis of filings. The insider transactions at the bank weren't widely known because of where they were filed and how the insider transactions were described in them.
While crypto assets were climbing, so were Signature Bank ( OTC:SBNY ) shares. In 2021, SBNY shares more than doubled , rising 136% to $319.70, while bitcoin ( BTC-USD ) gained 59%. But with several high-profile crypto company failures in 2022, Signature Bank's stock fell 63%.
On March 12, New York regulators put the bank into receivership after a "crisis of confidence in the management team," when customers rushed to withdraw deposits after the failures of Silicon Valley Bank and Silvergate Bank in the preceeding days.
The WSJ said the SBNY executives sold many of their 2021 shares in the spring at ~$220. The stock had hit an all-time high of $366 in early 2022.
Chairman Scott Shay, who had described himself as a "crypto enthusiast" in 2022, was the chair of the bank board's risk committee. He sold $5.4M of stock in 2021, according to the bank's disclosures. In 2020 to 2022, he bought $1.5M shares and ~$644K more in 2023.
Also on the board's risk committee were CEO Joseph DePaolo and the bank's chief operating officer, Eric Howell. De Paolo sold $13.9M of shares in 2021, and Howell sold $14.9M that year. The two executives sold a total of $9.2M more in March 2022, WSJ said , citing the disclosures. All three men had made statements and speeches encouraging doing business with crypto investors and companies, the article said.
The newspaper said Signature Bank ( OTC:SBNY ) didn't reply to a request for comment.
More on the Bank Crisis:
- Why This Banking Crisis Makes A Recession More Likely
- New York Community Bancorp: Grabbed The Spoils From Signature Bank's Downfall
- U.S. said to evaluate expanding emergency lending for banks
- New York Community Bancorp unit agrees to buy Signature Bank deposits, some loans
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Signature Bank insiders sold over $100M in shares during crypto boom - report