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Fintech Bank Hopefuls Face Capital Hurdles, FDIC Chair Says

April 24, 2019, 7:47 PM

Capital requirements are proving to be a high burden for fintech companies interested in bank charters, according to the FDIC.

“Working through the capital adequacy issues for fintechs has been rather interesting and cumbersome,” Federal Deposit Insurance Corp. Chairman Jelena McWilliams told reporters April 24.

The deposit insurer requires a newly-chartered bank to reach at least an 8 percent capital-to-assets level within the first three years of operation.

“A lot of them have equity but not really capital; a lot of them are profitable on paper but not really profitable,” McWilliams said at the sidelines of a FDIC fintech conference ...