What is the reason that Silvergate draws $4300M from FHLB while, at the same time, it has $4575M in cash and cash equivalent? Why doesn't it simply pay off its FHLB loan with its cash? This way, Silvergate could reduce its asset side by 38% and would have a Common equity /assets ratio of 5.7% instead of 3.55%.
What is the reason that Silvergate draws $4300M from FHLB while, at the same time, it has $4575M in cash and cash equivalent? Why doesn't it simply pay off its FHLB loan with its cash? This way, Silvergate could reduce its asset side by 38% and would have a Common equity /assets ratio of 5.7% instead of 3.55%.