The small but growing population of banks with specialized charters, coming against the backdrop of the increasing banking ambitions of fintechs and big techs, has led the Federal Reserve to propose uniform guidelines for requests to establish accounts and obtain services at the 12 district banks of the Federal Reserve System.
The move comes in the wake of an increase in what the Fed calls “novel charter types” being authorized or considered around the country. Among these are limited-service national bank charters, the payments bank charters suggested by former Acting Comptroller Brian Brooks, and special state charters such as Wyoming’s crypto banks. The proposal does not cover state-chartered industrial loan banks nor the fintech charter of the Comptroller’s Office. (None of the latter have been granted as it remains under legal challenge.)
While permission to open Fed system accounts rests with each district bank, “the proposed guidelines would reduce the potential for forum shopping across Reserve Banks and mitigate the risk that individual decisions by Reserve Banks could create de facto System policy for a particular business model or risk profile,” the central bank stated in a preamble to the proposal.
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