The Utah Department of Financial Institutions has issued charter approval for a new bank in the state for the first time since 2008. The bank, Square Financial Services, is expected to launch in 2021. It will operate independently, as a direct subsidiary of Square Inc. According to a release from Square, the bank’s primary purpose will be to offer small-business loans for Square Capital’s commercial lending business and to offer deposit products.
The charter approval from the state was conditional upon Square obtaining federal deposit insurance from the Federal Deposit Insurance Corp. (FDIC). Square cleared that hurdle last week as it received approval from the FDIC.
“We appreciate the FDIC’s thoughtful approach to our application, and their recognition that Square Capital is uniquely positioned to build a bridge between the financial system and the underserved,” said Jacqueline Reses, Square Capital lead and executive chairwoman of the board of directors. “We’re now focused on the work ahead to build out Square Financial Services and open our bank to small business customers.”
Square Financial Services’ application to operate as a state-chartered industrial bank headquartered in Salt Lake City was filed on Sept. 17, 2017, and was materially amended on Dec. 18, 2018. The bank plans to operate a nationwide business model that provides banking products and services primarily to consumers and small-to-medium sized businesses.
Square Financial Services CEO Lewis Goodwin and chief financial officer Brandon Soto will lead the bank’s executive team. Goodwin is the former president and CEO of Green Dot Bank and has held other senior banking roles at Toyota Savings Bank, Chrysler Financial Bank and West One Bank (merged with US Bank). He is a licensed CPA in Utah.
Soto was chief administrative officer and chief financial officer at Green Dot Bank and held other senior finance and accounting roles at Sallie Mae Bank, Chrysler Financial Bank, Toyota Savings Bank, Allegiance Direct Bank and JPMorgan Chase. He is also a licensed CPA.