“ICBA’s Support of Higher FDIC Coverage Is a Gift to Credit Unions”
Former ICBA chairs Preston Kennedy and Noah Wilcox argue the Hagerty-Alsobrooks deposit insurance proposal would ultimately harm community banks by giving tax-exempt credit unions a major competitive edge. In this op-ed for American Banker, they claim that extending up to $10 million in coverage for non-interest-bearing transaction accounts would allow credit unions to aggressively pursue business and municipal deposits, accelerating consolidation and worsening an already uneven playing field.
Meanwhile, CUs remain active buyers of banks, with deal volume continuing throughout 2025 and a potentially “target-rich” 2026 ahead.
2026 will be a make-or-break year for crypto legislation and housing policy, according to HFSC Chair French Hill, R-AK. Hill is urging the Senate to base its crypto market structure bill on the House-passed CLARITY Act, which he says reflects years of bipartisan work, and reiterated his view that stablecoins shouldn’t pay interest. He also said he hopes to advance housing and community-banking legislation early next year while signaling interest in leading the panel in the next Congress.
“OCC Green-Lights Circle, Ripple, Paxos For National Trust Bank Charters”
The line between banks and nonbanks continues to blur as regulators open more pathways into the banking system. The OCC last week conditionally approved national trust charters for several crypto firms, including Circle, Ripple, and Paxos, prompting bank groups to immediately warn that these companies pose risks that may not fit neatly within existing frameworks.
The OCC also conditionally approved a national bank charter for Erebor Bank, a tech-focused institution with deep ties to digital assets. Earlier this week on Banking with Interest, Ian Katz, managing partner at Capital Alpha Partners, discussed crypto firms’ push for regulated footholds inside the banking system and the implications for both industries.
But the charter push extends beyond crypto. PayPal has applied to establish an industrial bank, saying it would allow the company to expand small-business lending and rely less on third-party banks.
“FDIC Proposes Process For Banks To Issue Stablecoins”
Speaking of crypto, the FDIC approved a proposed rule setting up a formal application process for FDIC-supervised banks to issue payment stablecoins under the GENIUS Act. Applications would be automatically approved after 120 days if the agency takes no action, giving banks a clearer entry point into the market. Acting Chair Travis Hill said additional rulemakings are coming, including capital and liquidity standards for stablecoin issuance.
“Should Banks Bear The Burden When Customers Get Scammed?”
Sixty-two percent of Americans have been targeted by a scammer or know someone who has, and 67%—including nearly three-quarters of Gen Z and Millennials—believe banks should reimburse losses even if a consumer approves the transaction, a new survey found. The results underscore the growing tension banks face between fast, frictionless onboarding and pressure to absorb losses as scams become more frequent and sophisticated.
“A Hedge For Every Bank, When Rates Move And Balance Sheets Can’t”
Interest-rate shifts can outpace traditional balance-sheet fixes, particularly for banks without large derivatives teams, this article argues. It points to exchange-traded SOFR swap futures as a simpler hedging tool, describing them as more standardized and operationally lighter than over-the-counter swaps.
In Other News
Acclaimed director Rob Reiner and his wife, Michele Singer Reiner, were found stabbed to death in their Los Angeles home, with their son charged with murder; companies are increasingly hiring “storytellers” to shape their narratives; and a New York Times deep dive revisits the mystery of how Jeffrey Epstein built his fortune.