ICBA and the Bank Policy Institute wrote to the FDIC regarding Albert Corporation’s application on behalf of its proposed Utah state-chartered industrial bank (“Albert Bank”) for FDIC insurance. ICBA and BPI said until Congress closes the industrial loan company loophole, the FDIC should exercise its statutory authority to protect the Deposit Insurance Fund and the broader banking system by declining to approve applications that present risks.

They added that the regulatory arbitrage inherent in allowing a technology company to own an FDIC-insured bank without being subject to the consolidated supervision and activity restrictions placed on Bank Holding Company Act banks should be reason enough for FDIC to deny this application and the unique circumstances of Albert’s proposal present additional concerns regarding the independence of the bank.