Image credit: Shutterstocker
The U.S. Office of the Comptroller of the Currency has granted preliminary conditional approval for OpenReserve Bank, N.A. to become a full-service national bank based in Salt Lake City. The approval allows the organizers to continue building the institution, but OpenReserve cannot begin banking operations until it satisfies the OCC’s preopening requirements and receives final authorization.
OpenReserve applied for the charter on April 13 and plans to combine traditional banking services with tokenized deposits and other blockchain-based financial infrastructure. Its proposed offerings include deposits, lending, payments, treasury services and digital-asset services.
OpenReserve Plans Digital Asset and Stablecoin Services
The proposed bank plans to provide cryptocurrency custody services and allow customers to make cross-border transfers using digital assets, including stablecoins. It also intends to operate a full-service banking-as-a-service platform and provide foreign correspondent banking services.
OpenReserve also plans to establish a wholly owned subsidiary that would issue, custody, convert and facilitate payments involving U.S. dollar-denominated reserve-backed stablecoins. The OCC noted that an application for that subsidiary has not yet been filed.
The regulator emphasized that its decision is preliminary conditional approval only. Final approval will not be granted until OpenReserve completes the required steps and demonstrates that it is ready to begin operations.
Final Approval Requires More Regulatory Steps
OpenReserve must obtain federal deposit insurance from the Federal Deposit Insurance Corporation and apply for stock in a Federal Reserve Bank. Its own website also states that FDIC approval and other regulatory clearances are required before the bank can begin accepting deposits or providing banking services.
The OCC requires OpenReserve to begin with at least $210 million in paid-in capital after organizational and preopening expenses. The bank must also maintain a Tier 1 leverage ratio of at least 12% during its first three years of operation.
The preliminary approval expires if the required capital is not raised within 12 months or the bank does not open within 18 months, except in limited circumstances approved by the OCC. OpenReserve therefore has regulatory clearance to continue organizing the bank, but it does not yet have final authorization to operate as a national bank.
