Square, Nelnet Get OK to Form Banks from State, U.S. Regulators (1)

Square Inc. and Nelnet Inc. have passed two critical milestones in launching their own banks after federal and state regulators approved their applications.

The decisions announced Wednesday by the Federal Deposit Insurance Corp. marks the first approvals for companies to form an industrial bank since a moratorium lifted in 2013.

The companies also received approval Wednesday from Utah banking regulators to obtain a charter for an industrial loan company (ILC), another name for an industrial bank, both companies and the Utah Department of Financial Institutions confirmed.

The approvals are likely to usher in a new wave of industrial bank seekers ...