The European fintech American dream is being called into question
A double US banking application blow has called into question the fintech dream of landing on Wall Street. In this week’s column, Samuel Norman takes a look at the expansion roadmap for Europe’s top fintechs as well as the latest response to the booming profits in UK banks half-year reports. Denied, denied, withdrawn. That is [...]
Two US banking applications have raised doubts about European fintechs' aspirations to land on Wall Street. The Office of the Comptroller of Currency (OCC) rejected bids from UK fintechs Wise and Bunq, citing "significant supervisory and compliance concerns." Wise, which moved its primary listing to the US last year, was blocked due to anti-money laundering controls, while Bunq was asked to create a plan specifically for the US market.
The OCC also questioned Ali Niknam's plan to manage the US arm part-time. Both companies plan to reapply. This double blow challenges the belief that the US banking sphere is a deregulated land waiting for Europe's top talent. Some fintechs, like Zilch, are reconsidering their US strategies. The sector's excitement for the US market remains, driven by recent pro-banking reforms under the Trump administration.
However, navigating the US market, with its dual banking system and 50 individual state licences, proves challenging. The sector's profits have surged, with Britain's big four banks earning £29.2bn in the first half of the year, with half paid to shareholders. Analysts warn that banks might be overearning due to higher interest rates, structural tailwinds, and credit conditions. Some argue that investors should not assume these returns will continue indefinitely.
Written by urgent.news from City AM's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
