- Signature bank’s earnings release shows that deposits rose by 8% in Q3
- Signature Bank continues to win crypto clients in 2020
Signature Bank, an NYC-based challenger bank, has reached a 40% increase in deposits, 8% of which were achieved in the last quarter. As previously reported, the crypto bank’s blockchain push, introducing the first (fiat-pegged) stablecoin in 2019, prompted JP Morgan Chase and Goldman Sachs to review their own digital propositions.
CEO and founder of Signature, Joseph DePaolo, has publicly lauded the future of cryptocurrency, digital assets, and blockchain. Speaking in 2018, he announced, ‘If you’re not involved in blockchain, in five years you won’t be around as a bank,’ shortly after launching Signet, the crypto bank’s own DLT-led payment platform. Signet allows real-time settlement and real-time transactions between customers of the crypto bank.
Signature Bank is due to release an earnings call to announce the growth of non-interest-bearing deposits. This should be another indicator of uptake in crypto clients for the bank.
Why deposits for a crypto bank?
Signature has long held an operating focus on deposits, with DePaolo describing banking as bringing in deposits rather than lending. The idea is that the cost is recouped by growing the customer base and offering them other banking services.
The focus has been successful thus far. In Q2, $1bn of the $8bn in deposit growth was brought in by the digital assets team. As a bank clearly open to crypto firms, Signature’s deposit growth indicates crypto companies are taking up an increasing number of their low-cost deposits.
Signature Bank began as a start-up in 2000 and now constitutes $53bn in only 20 years. It remains small in comparison to other top NYC banks but continues to punch above its weight.