On September 18, 2024, S&P Global Market Intelligence quoted Max Bonici on the recent trend of financial technology companies exploring the possibility of getting bank charters. According to the article, a very small number of fintechs have gone through with it.
S&P Global Market Intelligence noted that smaller depository institutions are often most reasonable targets for fintech buyers. “A de novo application requires building a capital base from scratch, so buying a bank has the benefit of starting with an existing capital base and going-concern operations,” Bonici said. “To be considered a good target for a fintech, a bank needs to be adequately capitalized and have a track record in compliance to the Community Reinvestment Act, safety and soundness principles and fair lending laws.”
Bonici explained that “for any fintech buyers, a focus on deposits and lending on a sustained basis will make a stronger case to regulators to approve any deals.”
"A fintech that wants to acquire a bank should probably look and walk and talk like a bank," Bonici said. "Under this administration, that will get you farther."
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