In a statement shared after this article’s publication, Paige Pidano Paridon, the executive vice president and co-head of regulatory affairs at the Bank Policy Institute said, “BPI supports efforts to bring innovative new products and services into the regulated banking ecosystem, provided that the entities engaging in those activities are subject to the same rules and responsibilities as every other chartered institution engaging in the same activities.”
Firms should not get trust charters unless they only engage in “trust activities,” she said, adding, “if they want to engage in traditional banking activities, they should seek full-service banking charters. Rigorous, uniform standards are essential to fostering a competitive, safe and resilient banking system.”
The industry’s pursuit of national trust charters has been credited by banking regulators for representing a resurgence in new banking names after a lengthy drought.
Some of the trusts have been hatched as crypto-focused banks, such as Protego and Erebor. Others have come from the existing ranks of prominent crypto businesses, such as Coinbase, Circle and Crypto.com.
A recent addition is World Liberty Financial, the firm partly owned by President Donald Trump and his family, with its charter approval drawing ire from critics including Democratic Senator Elizabeth Warren, who accused the agency of permitting presidential corruption and posted on social media site X that the new charter “giving him and his family a new way to profit.”