Erebor Bank, a Columbus, Ohio-based digital bank serving high-net-worth individuals and startups, has been approved for a national bank charter by the Office of the Comptroller of the Currency (OCC). Erebor was previously approved for a conditional charter in October. FDIC insurance was approved in December.
According to a WSJ.com report, the bank will be capitalized with $635 million. Erebor aims to fill the void left by Silicon Valley Bank, which collapsed due to excessive debt risk and a mismanaged portfolio.
Erebor is the creation of entrepreneur Palmer Luckey, who has corralled a list of big-name investors. The startup’s initial valuation has been pegged at around $4 billion.
Luckey, who is not engaged with day-to-day operations, posted earlier this week that Erebor is based on a “cutting-edge business model” and “next-gen concepts.”
He has stated that they will maintain the industry’s most conservative loan-to-deposit ratio.
The Comptroller of the Currency, Jonathan Gould, congratulated Erebor on the charter approval:
“Congratulations to the entire Erebor team! This is an exciting day for the banking system and reflects the OCC’s commitment to a dynamic and diverse financial system that remains innovative and relevant over time.”
Gould went on to explain that “the OCC is supporting a healthy economy that provides the American people with access to banking services that meet their unique needs by aligning innovation with proper supervision.”
The administration’s support for Fintech innovation, including digital assets, stands in stark contrast to the four years of President Biden-induced stasis, during which the US fell behind as politics swamped rational policy.