Signature Bank Names Its COO as New CEO Following Crypto Troubles | CPT PPP Coverage

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Signature Bank has named a new chief executive following a stretch of cryptocurrency-related headaches.

Joseph DePaolo, the bank’s longtime president and CEO, will move into an advisory role this year, Signature announced Thursday (Feb. 16), with Chief Operating Officer Eric Howell eventually taking his place.

DePaolo, who helped found the financial institution in 2001, led Signature to “become one of the nation’s top 25 largest banks, achieving this purely organically, without any acquisitions,” the company said in a news release.

Howell has been with Signature from its inception as well, and has served as its controller and chief financial officer.

A spokesperson for Signature told PYMNTS that the leadership change is something that had been in the works for years, and had nothing to do with the bank’s digital assets business.

As PYMNTS has written, Signature was part of a group of banks that initially courted the cryptocurrency industry while the market was booming. Since the downfall of crypto platform FTX — a Signature client — the bank has tried to distance itself from the digital assets world.

“We’re not just a crypto bank and we want that to come across loud and clear,” Howell told an industry conference in December.

He added that Signature was “going to exit about $8 billion to $10 billion worth of deposits in that space, which we can easily cover through cash and borrowings.” Last month, Signature reportedly placed a $100,000 minimum on crypto transactions.

Among the bank’s crypto customers was the now-bankrupt Celsius Network and FTX, whose implosion rocked the crypto world.

It also led to a lawsuit earlier this month by trading firm Statistica Capital, claiming Signature allegedly “had actual knowledge of and substantially facilitated the now-infamous FTX fraud.”

The suit further accuses Signature of permitting the commingling of FTX customer funds within Signet, the bank’s blockchain-based payments network.

“Plaintiffs themselves advised Signature on multiple occasions that their funds were intended for FTX; Signature nevertheless allowed their funds to be transferred via Signet and by wire into Alameda controlled accounts,” the suit says, in a reference to FTX’s sister company.

Another bank that had done business with the crypto world, Silvergate Capital, has also found itself dealing with the fallout of the industry’s downturn following FTX’s collapse.

Earlier this month, PYMNTS wrote that the U.S. Justice Department was examining Silvergate’s hosting of accounts for FTX and Alameda, though the bank has not been accused of wrongdoing.

Silvergate claims that it conducted due diligence on both firms during the onboarding process and has said it is conducting its own investigations of transactions tied to the two companies.