Climate Change Data

Environmental Metrics

Climate Goals & Targets

Environmental Challenges

• Risks related to our digital currency initiative, including risks that the digital currency industry may not gain widespread adoption, that legal and regulatory uncertainty regarding the regulation of digital currencies and digital currency activities may inhibit the growth of the digital currency industry, that our low-cost funding strategy may not be sustainable, that our deposits may be adversely affected by price volatility and that our further development and/or implementation of our solutions and services may not successful; risks related to cybersecurity and technology, including risks that our systems may fail or be breached, that we may not have sufficient resources to keep pace with rapid technological change in the financial services industry, that our technology may malfunction and that the third-party service providers we use may experience systems failures; risks related to our traditional banking business, including risks that a sustained downturn of the economy in the United States or in California may adversely impact our business, that our competitors may lower their loan rates or underwriting standards, that our risk management practices or allowance for loan losses may not be sufficient and that fluctuations in interest rates and the monetary policies and regulations of the Board of Governors of the Federal Reserve System, or the Federal Reserve, may negatively impact our business; and risks related to regulation, including risks that legislative and regulatory actions may increase our costs and negatively impact our business, that the capital requirements that the Bank and the Company are subject to may limit our activities and that our compliance with anti-money laundering laws may not be adequate to detect or prevent money laundering activities and could subject us to fines or regulatory actions.

Mitigation Strategies

• We believe that our risk management and compliance framework, which includes thorough reviews we conduct as part of our due diligence process (either in connection with onboarding new customers or monitoring existing customers), is reasonably designed to detect any such illicit activities conducted by our potential or existing customers (or, in the case of digital currency exchanges, their customers), we cannot ensure that we will be able to detect any such illegal activity in all instances. We regularly add additional security measures to our computer systems and network infrastructure to mitigate the possibility of cybersecurity breaches, including firewalls and penetration testing. We maintain a system of internal controls to mitigate operational risks, including data processing system failures and errors and customer or employee fraud, as well as insurance coverage designed to protect us from material losses associated with these risks, including losses resulting from any associated business interruption. We have developed enhanced procedures to screen and monitor these customers, which include, but are not limited to, system monitoring rules tailored to digital currency activities, a system of “red flags” specific to various customer types and activities, the development of and investment in proprietary technology tools to supplement our third-party transaction monitoring system, customer risk scoring with risk factors specific to the digital-currency industry, and the use of various blockchain monitoring tools.

Supply Chain Management

Climate-Related Risks & Opportunities

Environmental Metrics

ESG Focus Areas

• Diversity and Inclusion
• Environmental Impact
• Employee Wellbeing

Environmental Achievements

• Successfully moved to a virtual-first workplace in 2020, with approximately 96% of our employees working remotely as of December 31, 2021. The environmental impact of our operations is limited.

Social Achievements

• Silvergate strongly believes that a diverse workforce and an inclusive environment improve individual and organizational performance.
• Silvergate aspires to create an empowering workplace that enables employees to advance new solutions, while working consciously to help protect the planet. We aim to empower employees’ lives outside of work, with a strong benefits package as well as flexibility and support for parents and other caregivers. Our commitment to remote work minimizes environmental impact while also helping our employees lead healthier, happier lives.

Governance Achievements

• Not disclosed

Climate Goals & Targets

Environmental Challenges

• Risks Related to the Digital Currency Industry: Digital currencies and the digital currency industry are relatively new and, in many cases, lightly regulated or largely unregulated. Some types of digital currency have characteristics that make digital currency particularly susceptible to use in illegal activity such as fraud, money laundering, tax evasion and ransomware scams.
• Risks Related to Our Digital Currency Initiative: We rely heavily on the success of the digital currency industry, the development and acceptance of which is subject to a variety of factors that are difficult to evaluate.
• Risks Related to Cybersecurity and Technology: System failure or cybersecurity breaches of our network security could subject us to increased operating costs as well as litigation and other potential losses.
• Risks Related to Our Traditional Banking Business: As a business operating in the financial services industry, our business and operations may be adversely affected in numerous and complex ways by weak economic conditions.
• Risks Related to Regulation: There is substantial legal and regulatory uncertainty regarding the regulation of digital currencies and digital currency activities.

Mitigation Strategies

• We believe that our risk management and compliance framework is reasonably designed to detect any such illicit activities conducted by our potential or existing customers.
• We regularly add additional security measures to our computer systems and network infrastructure to mitigate the possibility of cybersecurity breaches.
• We maintain an allowance for loan losses that represents management’s judgment of probable losses and risks inherent in our loan portfolio.
• We adhere to what we believe are disciplined underwriting practices, pursuant to conservative standards and guidelines.
• We have developed enhanced procedures to screen and monitor these customers, which include, but are not limited to, system monitoring rules tailored to digital currency activities, a system of “red flags” specific to various customer types and activities, the development of and investment in proprietary technology tools to supplement our third-party transaction monitoring system, customer risk scoring with risk factors specific to the digital-currency industry, and the use of various blockchain monitoring tools.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Not disclosed

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: Null

Certifications: Null

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Not disclosed

Environmental Metrics

Climate Goals & Targets

Environmental Challenges

• Orderly wind down of Silvergate Bank operations and voluntary liquidation.
• Continuous developments relating to regulatory matters, inquiries, and investigations.
• Potential liabilities from various litigation.
• Inability of the independent registered public accounting firm to complete audit procedures due to the above challenges.

Mitigation Strategies

• Minimizing costs and expenses to preserve value for stakeholders.
• Reduction in workforce, including financial reporting personnel, to align staffing with Bank Liquidation objectives and efficient resolution of claims.

Supply Chain Management

Climate-Related Risks & Opportunities