The Office of the Comptroller of the Currency (OCC) conditionally approved a banking charter for the fintech SoFi on Tuesday.
However, the OCC restricted the bank — once it’s operational — from engaging in crypto-asset activities or services unless the regulator first gives notice of non-objection.
"Today’s decision brings SoFi, a large fintech, inside the federal bank regulatory perimeter, where it will be subject to comprehensive supervision and the full panoply of bank regulations," the OCC’s acting chief, Michael Hsu, said Tuesday in a statement, adding that the limit on crypto is "consistent with the comprehensive legal and policy review of pending licensing decisions I initiated last May." The move "levels the playing field and will ensure that SoFi’s deposit and lending activities are conducted safely and soundly," Hsu said.
This isn’t the first time the OCC has given SoFi a go-ahead on a charter. The agency conditionally approved the fintech's previous de novo application in October 2020. But SoFi’s March 2021 agreement to buy Golden Pacific Bancorp — a three-branch, $150 million-asset community bank — for $22.3 million allowed the fintech to switch to a change-in-bank-control application, hastening the charter process.
SoFi said Tuesday it expects the Golden Pacific acquisition to close next month. Golden Pacific and its branches will operate as a community banking division of SoFi Bank under that deal.
"This incredible milestone elevates our ability to help even more people get their money right and realize their ambitions," SoFi CEO Anthony Noto said Tuesday in a press release. "This important step allows us to add to our broad suite of financial products and services to better be there for our members during the major financial moments in their lives and all of the moments in between."
Specifically, Noto said he expects the company will be able to lend at more competitive interest rates and offer higher-interest yields to checking and savings account customers. The charter move should put SoFi in a position to hold on to a greater portion of each transaction because it won’t be giving a cut to a partner bank.
Among the OCC’s other conditions, SoFi must have initial paid-in capital of $750 million before the bank launches. The company said last year it would put that amount toward SoFi Bank’s nationwide digital banking strategy.
SoFi has also applied to become a bank holding company overseen by the Federal Reserve.