Legal Seminar, Denver, CO

Fintech Charter: OCC Special Purpose Chartering Authority: ICBA v. FRB OCC: ICBA v. FRB confirmed the OCC’s authority to issue a limited purpose charter • ICBA v. FRB upheld FRB approval of interstate acquisition of a newly chartered national credit card bank CSBS: ICBA v. FRB has no bearing on the OCC’s authority to create the fintech charter • The credit card bank at issue in ICBA v. FRB took deposits, was insured, and qualified as a “bank” under the BHCA. • Did not hold that a national bank may limit its activities to the point that it no longer qualifies as a “bank”.

• Held that national bank limiting activities to less than their full scope was not impermissible under the NBA or the BHCA. – Relied on Citicorp , 67 Fed. Res. Bull. 181 (1981) • OCC minimized importance of the credit card bank’s status as an IDI • Credit card banks are a counterexample to the argument that special purpose charters require specific statutory authority.

• Held that limitation of a national bank’s activities is impermissible if it interferes with the bank’s ability to fulfill its statutory obligations. • No court has approved chartering of credit card bank that would not have qualified as a BHCA

“bank” but for the CEBA exemption. – “Limited Service” vs. “Special Purpose”

For Discussion Purposes Only

Fintech Charter: Recent Developments

• OCC stated that they plan to announce their decision with respect to the fintech charter sometime in July 2018.

• Open question as to whether fintech charter will look different from previous iteration. – In testimony, Comptroller Otting did make clear that they believe they have the requisite statutory authority to create the fintech charter.

For Discussion Purposes Only