ICBA and other groups told the OCC that recent national bank charter applications raise substantial concerns and urged the OCC to postpone considering the applications.
Details: In a joint letter concerning the national trust charter applications submitted by National Digital TR CO; Fidelity Digital Assets, N.A.; First National Digital Currency Bank, N.A.; and Ripple National TR Bank, ICBA and the other groups said:
There are significant policy and legal questions as to whether the applicants’ proposed business plans involve the types of fiduciary activities performed by national trust banks.
Granting these applications could represent a fundamental departure from existing OCC precedent,
Public portions of the applications do not allow for meaningful public scrutiny—and broader change to OCC policy with respect to trust activities requires public scrutiny.
What It Means for Community Banks: In a recent letter to the OCC, ICBA urged the agency to keep in mind several key principles when considering digital asset charter applications, including their unique risks and need for sufficient supervisory and regulatory safeguards. ICBA noted that applications from nonbank digital asset-related entities seeking to establish full-service national banks or limited-purpose national banks pose unique challenges to bank chartering policy and to the safety and soundness of the financial system.
Regulatory and Capital Disparities: In a national news release on ICBA’s letter, ICBA President and CEO Rebeca Romero Rainey cited potential risks posed by granting national bank charters to nonbank digital asset firms, particularly for trust banks, which are not required to meet the same kinds of regulatory and capital standards that apply to federally insured full-service banks.