National Association of Industrial Bankers

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House Financial Services Committee reaffirms the Regulatory Oversight and Strengths of Industrial Banks

On May 19, the US House Financial Services Committee (HFSC) conducted a hearing “Oversight of Prudential Regulators: Ensuring the Safety, Soundness, Diversity, and Accountability of Depository Institutions.” Federal regulators offered verbal and written testimony regarding their views on various matters confronting financial institutions. FDIC Chairman Jelena McWilliams fielded several questions regarding industrial banks, which her agency supervises.

“Several members of the HFSC inquired of the Chairman her opinion regarding industrial banks. During these exchanges, there was no dispute that industrial banks are among the safest and soundest financial institutions in the country. Further, no statements were made in the hearing to counter the fact that federal and state authorities fully regulate industrial banks,” stated Frank Pignanelli, Executive Director, The National Association of Industrial Bankers.

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Watch the House Financial Services Committee Virtual Hearing

Congratulations to America’s New Industrial Banks

Congratulations to Square and Nelnet for commencing operations of their new Industrial Loan Corporations (ILC) on March 1, 2021 and November 2, 2020, respectively. These FDIC-insured industrial banks operating in Utah are the first to open in the state since 2008.

“Square and Nelnet are great additions to the U.S. banking sector. We congratulate them for succeeding through the rigorous federal and state application process,” said Frank Pignanelli, Executive Director of the National Association of Industrial Bankers.

On March 18, 2020, the FDIC approved the applications submitted by Square Financial Services and Nelnet Bank for deposit insurance as new Industrial Loan Corporation (ILC) charters. Simultaneously, the Utah Department of Financial Institutions approved the industrial bank charter applications. (ILCs are also referred to as industrial banks.)

UCFS Brokered Deposits Report Released

James R. Barth and Yanfei Sun of Auburn University conducted a study for the Utah Center for Financial Services (UCFS) examine brokered deposits in the context of their origin, regulatory history, use, and performance.

Ameriprise Financial Applies for a State Industrial Bank Charter

Ameriprise Financial (NYSE: AMP) has filed an application to convert Ameriprise Bank, FSB to a state-chartered industrial bank (IB) regulated by the Utah Department of Financial Institutions (UDFI) and the Federal Deposit Insurance Corporation (FDIC).

An OCC Insider’s Perspective on Fintechs and Bank Charters

While the novel fintech charter may never actually be granted, the concept ironically may usher in a rash of neobanks under full national charters, like Varo Bank. In a way that may end up creating a more level playing field.

FDIC finishes long-awaited rules on brokered funds, ILCs

Banks and some of their deposit-gathering businesses won additional regulatory relief when the Federal Deposit Insurance Corp. finalized a new framework for classifying brokered deposits enabling a broader set of companies to escape restrictions.

Politico PRO Q&A: FDIC Chairman Jelena McWilliams

FDIC Chairman Jelena McWilliams is overseeing the banking system in the middle of an economic crisis, while working to adapt to new technology and grappling with evolving risks from climate change.

FDIC chair hopes regulators will ‘come together’ on CRA reform: Report

The head of the Federal Deposit Insurance Corp. became the second top regulator in two weeks to voice support for an interagency framework to reform the Community Reinvestment Act.

Banner year for de novos

Groups hoping to open new banks hit their stride in 2018.

Through Dec. 13, the Federal Deposit Insurance Corp. had approved 14 bank applications, with seven more pending. In comparison, the agency signed off on 10 total charters during the prior two years.

Jelena McWilliams, the new FDIC chairman, has signaled that the agency will be more supportive of de novo banks. The FDIC, for instance, recently announced that it is seeking public comment to improve the application process.