Search Results for "Federal Reserve"
25 results for "Federal Reserve"
Deals 20
FDIC Targets Stablecoin Licensing by Year-End 2025; Fed Plans Fintech Master Accounts by Q4 2026
Federal banking regulators previewed timelines for key fintech and digital asset rules in December 2025. The FDIC is targeting stablecoin licensing guidance by year-end 2025, while the Federal Reserve aims to establish 'skinny' master account access for novel charter holders by Q4 2026. These developments could significantly impact BaaS and embedded finance infrastructure.
SmartBiz Loans Completes Acquisition of Centrust Bank With OCC Approval
SmartBiz Loans, a fintech small business lending marketplace, completed its acquisition of United Community Bancshares and its subsidiary Centrust Bank (now renamed SmartBiz Bank). The deal, approved by the OCC and Federal Reserve, involved a bank with $148 million in assets. This rare fintech acquisition of a bank charter positions SmartBiz to expand into nationwide small business lending and planned national deposit products.
Telcoin Wins Nebraska Conditional Approval as First Digital Asset Bank
Telcoin received conditional approval from the Nebraska Department of Banking and Finance to become the state's first Digital Asset Depository Institution (DADI). This makes Telcoin the first regulated U.S. crypto bank explicitly authorized to connect consumers to decentralized finance. The approval positions Telcoin for potential access to the Federal Reserve payment system.
US Regulators Intensify Scrutiny of Bank-Fintech Partnerships in October 2024
In October 2024, the OCC, FDIC, and Federal Reserve received multiple comment letters on bank-fintech partnership risks. Submissions addressed supervision gaps, deposit-taking risks, and examination authority over fintechs. Fed Governor Bowman called for uniform regulations across banks, credit unions, and fintechs. FDIC consent orders requiring banks to offboard fintech partners signaled escalating enforcement.
OakNorth Receives Fed and NYDFS Approval for US Representative Office
UK-based fintech lender OakNorth received approval from the Federal Reserve and New York State Department of Financial Services to open a US Representative Office. This allows OakNorth to market its products in the US as a stepping stone toward pursuing a full US banking charter.
US Banking Agencies Issue Joint RFI on Bank-Fintech and BaaS Arrangements
The OCC, FDIC, and Federal Reserve jointly issued a Request for Information (RFI) scrutinizing bank-fintech arrangements, including BaaS and middleware platforms. The RFI specifically targets intermediate platform providers that connect banks to fintechs via APIs. Regulators seek input on risk management, compliance practices, and potential new supervisory guidance. Comments were due approximately 60 days after the July 31, 2024 Federal Register publication.
Federal Reserve Issues Cease-and-Desist Against Evolve Bank Over Fintech Risks
The Federal Reserve issued a cease-and-desist order against Evolve Bank & Trust on June 14, 2024, citing deficiencies in risk management related to its fintech partnerships. The order requires Evolve to obtain prior regulatory approval before onboarding new fintech partners. This is a landmark enforcement action signaling heightened scrutiny of BaaS sponsor banks.
VersaBank Receives Fed Approval to Acquire Stearns Bank Holdingford
Canadian digital bank VersaBank received Federal Reserve approval to acquire Stearns Bank Holdingford, a small OCC-chartered bank with $78M in assets. The deal gives VersaBank a U.S. bank charter to expand its digital lending operations into the American market. OCC approval was expected shortly after.
Federal Reserve Denies The Narrow Bank's Master Account After Six Years
The Federal Reserve denied The Narrow Bank's (TNB) application for a master account after a six-year review process. While TNB is not a traditional fintech, the denial underscores the difficulty non-traditional financial entities face in accessing Fed infrastructure. The decision reinforces the regulatory barriers that push fintechs toward BaaS partnership models.
Federal Reserve Establishes Novel Activities Supervision Program for Bank-Fintech Partnerships
The Federal Reserve Board issued supervisory letters establishing a Novel Activities Supervision Program targeting complex, technology-driven partnerships between banks and nonbanks. The program focuses on fintech arrangements involving APIs and automated infrastructure access. This signals heightened regulatory scrutiny of BaaS and embedded finance models.
Savi Financial Receives FDIC Approval for De Novo Orca Bank Charter
Savi Financial Corp. received FDIC approval in 2023 for a Washington state-chartered de novo bank called Orca Bank. The company still required Federal Reserve approval and targeted a Q1 2024 opening. The approval is notable given the extremely challenging environment for new bank charters, especially for fintech-adjacent applicants.
Federal Reserve Launches FedNow Instant Payment Service
The Federal Reserve launched the FedNow® Service, enabling 24/7 real-time transactions across the U.S. banking system. The launch modernizes U.S. payment infrastructure and represents a transformational moment for the fintech industry. FedNow provides an alternative to the existing RTP network operated by The Clearing House.
US Regulators Finalize Interagency Third-Party Risk Management Guidance
The FDIC, OCC, and Federal Reserve jointly finalized guidance on third-party risk management, published June 6, 2023. The guidance directly impacts BaaS banks and their fintech partnerships by establishing unified expectations for oversight of third-party relationships. It represents the most significant US regulatory framework development for embedded finance and BaaS in 2023.
Federal Reserve Policy Statement Restricts State Member Banks' Crypto Activities
The Federal Reserve issued a policy statement effective February 7, 2023, limiting state member banks' activities—particularly crypto asset activities—to those permissible for national banks. The statement also requires state member banks to obtain prior supervisory approval before engaging in certain crypto-related activities. This significantly narrows the regulatory pathway for BaaS and embedded finance models built on state-chartered bank crypto capabilities.
Federal Reserve Denies Custodia Bank Application for Fed Membership
The Federal Reserve denied Custodia Bank's application for Federal Reserve System membership, citing safety, soundness, and risk management concerns including money laundering risks. Custodia is a Wyoming-chartered fintech focused on crypto custody and payments. The denial signals intensifying regulatory scrutiny of crypto-focused fintech bank applications.
NYCB Receives OCC Approval for Flagstar Merger and National Charter
New York Community Bank received OCC approval in late October 2022 to merge with Flagstar Bank and convert to a national bank charter. The deal still required Federal Reserve approval. The combined entity would create a larger banking platform with expanded capabilities relevant to the BaaS and fintech partnership ecosystem.
NYCB and Flagstar Extend Merger Timeline and Propose National Charter Switch
New York Community Bancorp (NYCB) and Flagstar Bancorp announced plans to extend their merger timeline to October 2022 and proposed switching the combined entity to a national bank charter. Flagstar has been a significant sponsor bank in the BaaS ecosystem. The charter change would require OCC and Federal Reserve approval.
Kraken Bank Applies for Federal Reserve Master Account Access
Kraken Bank, operating under a Wyoming Special Purpose Depository Institution (SPDI) charter, applied for a Federal Reserve master account on July 12, 2021. The application raised significant policy questions about fintech and crypto firm access to Fed payment infrastructure. The request remained pending, becoming a focal point for debates on non-traditional bank access to core banking services.
SoFi Receives Preliminary Conditional National Bank Charter from OCC
The Office of the Comptroller of the Currency granted SoFi preliminary conditional approval for a national bank charter on October 28, 2020. SoFi had applied in July 2020 and still required additional approvals from the Federal Reserve and FDIC. The charter would allow SoFi to operate under unified federal regulations rather than a patchwork of state requirements, positioning it to compete more directly with traditional banks.
Jiko Becomes First Fintech to Purchase a US-Regulated Bank
Jiko completed its acquisition of Mid-Central Federal Savings Bank on September 4, 2020, becoming the first fintech to purchase a US-regulated bank. The deal received approvals from the OCC and the Federal Reserve Bank of San Francisco. Acting OCC Comptroller Brian Brooks praised the acquisition as a milestone for fintech maturity.
Regulatory Actions 5
Industry-Wide
The OCC, FDIC, and Federal Reserve issued a Request for Information seeking public comments on risks in bank-fintech arrangements, including accountability gaps, end-user confusion, rapid growth, concentration, liquidity, and data ownership.
Industry-Wide
The OCC, FDIC, and Federal Reserve jointly issued a statement reminding banks of risks in third-party arrangements with fintechs for delivering deposit, payment, and lending products. The statement outlines risk management examples without creating new rules.
N/A — Industry-wide joint statement
The OCC, Federal Reserve, and FDIC jointly issued a statement on July 25, 2024, highlighting risks in third-party arrangements for bank deposit products and services. The statement emphasizes that banks retain full accountability for consumer protection, financial crimes prevention, and safe/sound practices despite outsourcing to fintechs.
N/A — Industry Guidance
Federal banking agencies (Federal Reserve, OCC, FDIC) issued joint guidance in August 2021 advising community banks on conducting due diligence when entering fintech partnerships. The guidance emphasizes risks including legal/regulatory compliance, AML, consumer protection, and contract terms.
Industry-Wide
The Federal Reserve published a guide in August 2021 for community banks on conducting due diligence for fintech third-party relationships. The guide covers legal compliance, risk management processes, contract provisions for audits, and consumer protection alignment.