Summary:
Situation Overview: FDIC is focused on de novo bank formation, digital assets and blockchain activities, resolution planning, and asset thresholds for “tailoring” categories.
What: The FDIC is reevaluating guidance in these areas.
Who: FinTechs and Large Banks subject to FDIC supervision.
In Depth
In April 2025, Federal Deposit Insurance Corporation (FDIC) Acting Chairman Travis Hill announced that the FDIC is focused on four key policy areas: de novo bank formation, digital assets and blockchain activities, resolution planning, and “tailoring” asset thresholds.
This announcement signals that the FDIC is considering substantive changes in each of these areas.
This summary outlines the potential changes and their implications for FinTech firms and bank management.
De Novo Bank Formation
Due to a significant decline in the number of bank charters—from 8,500 in 2008 to 4,500 today—the FDIC is exploring ways to promote new bank formation. This includes reevaluating how deposit insurance applications are processed for proposed banks with new or innovative business models. Chairman Hill noted, “A fintech with a large number of deposit accounts may present less risk to the Deposit Insurance Fund if it becomes a regulated bank, rather than placing deposits at multiple banks through complex partnership arrangements.”
What FinTechs Should Do
Continue to build robust compliance management and AML/BSA systems, providing a firm with the foundation to become an FDIC-regulated entity if warranted by business conditions and the regulatory environment.
Digital Assets and Blockchain
The FDIC recently issued a Financial Institution Letter (FIL), clarifying that institutions it supervises may engage in permissible crypto-related activities without prior agency approval. Chairman Hill noted “…permissible crypto-related activities will … be treated … like other permissible activities, and…we expect institutions to consider and manage associated risks, and engage with their supervisory teams as appropriate.” He also indicated that the FDIC is developing additional guidance on particular crypto-related activities.
What Banks Should Do
Banks exploring crypto- and blockchain-related activities can use this time to educate senior management and their Board of Directors on relevant risks; design and build risk management capabilities for these innovative areas; and prepare internal product approval processes for a thorough review of any proposed activities. Early and frequent engagement with supervisors on these initiatives is recommended.
Resolution Planning
Chairman Hill reiterated that the revised 2024 Insured Depository Institution (IDI) resolution plan rule places too much emphasis on bridge bank entry and exit. Instead, Chairman Hill is focused on “maximizing the likelihood of the optimal resolution option, which experience has demonstrated to generally be a weekend sale.” He indicated that the FDIC will soon issue updated FAQs related to upcoming IDI resolution plan submissions. The FDIC will look for resolution plans that enable firms to provide the FDIC with information needed to rapidly market the institution and run the institution for a short period of time if needed.
The FDIC intends to engage with bank and non-bank potential acquirers, asking questions regarding what information is needed by bidders and how that information should be presented. These discussions will inform the FDIC’s capabilities testing.
The FDIC also plans to waive or reduce certain requirements, particularly around building a hypothetical failure scenario. Chairman Hill did not differentiate between Group A and Group B filers in his remarks.
What Banks Should Do
Banks with upcoming resolution plan submissions should focus on building and testing capabilities to support a resolution weekend sale and temporary FDIC management. This includes capabilities which ensure the marketability of the IDI or franchise components (e.g., refreshing a virtual data room quickly), as well as being able to quickly identify and report key depositors, critical services support, and key personnel.
Asset Thresholds for Tailoring
Chairman Hill referenced the 2019 tailoring categories for large banks and suggested that the current quantitative thresholds should be reevaluated. He noted that, due to inflation, $100 billion in 2019 equates to approximately $124 billion today. Under the tailoring rules, these quantitative thresholds impact when an institution must comply with a wide range of prudential regulatory requirements, including stress testing, liquidity, and single counterparty credit limits.
The FDIC is evaluating whether to raise – and potentially index – regulatory thresholds to reflect inflation, macroeconomic conditions, and industry growth.
What Banks Should Do
Category transition planning is a multi-year, multi-regulatory agency effort. The FDIC’s review is in early stages. For institutions engaged in category transition planning, it is recommended to continue those planning activities, pending further multi-agency (e.g., Fed, OCC, FDIC) guidance.
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