Acting Comptroller Keith Noreika Wednesday endorsed hispredecessor's plan to issue national bank charters to fintechcompanies.

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Speaking at the Exchequer Club in Washington, Noreika also saidthat despite a lawsuit challenging the OCC's power to issuesuch charters.

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“On principle, companies that offer banking products andservices should be allowed to apply for national bank charters sothat they can pursue their businesses on a national scale if theychoose, and if they meet the criteria and standards for doing so,”he said, according to a text of his speech.

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He added, “I also believe that if you provide banking productsand services, acting like a bank, you ought to be regulated andsupervised like a bank. It is only fair, but today, that is nothappening.”

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In March, then-Comptroller Thomas Curry said that the OCC wouldissue such charters to fintech companies.

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That decision is being challenged in federal court by theConference of State Bank Supervisors, which representsstate-chartered banks. The group claims that the charter proposalviolates federal law.

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“We believe that we have the authority to do this in appropriatecircumstances,” Noreika said.

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He also said that the OCC several years ago clarified its rulesregarding special national purpose banks and he believes fintechcompanies would qualify under those particular rules.

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He added, however, that the OCC has not received anyapplications from fintech companies based on that rule. And headded that the agency has not determined whether it would actuallyaccept or act upon applications from nondepository fintenchcompanies under that rule.

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Noreika said that the banking community must continue to adaptto technological changes in the industry.

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“We should be careful to avoid defining banking too narrowly orin a stagnant way that prevents the system from evolving or takingproper and responsible advantage of advances in technology andcommerce,” he said.

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Noreika said that hundreds of fintech companies provide bankingservices without being subject to the rigorous oversight that banksreceived.

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“People who think that granting national bank charters tofintechs creates a disadvantage for banks have it backwards,” hesaid. “The status quo disadvantages banks in many ways. Whilecharters would provide great value to the companies that receivethem, the supervision that accompanies becoming a national bankwould help level the playing field in meaningful ways.”

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