Wise Shares Plummet After Regulators Reject National Trust Bank Application

London-listed Wise shares plummeted by 10% on Friday after regulators denied its application to establish a national trust bank in the United States. The U.S. Office of the Comptroller of the Currency rejected the company's bid, citing that its approach was incompatible with the Federal Reserve's new policies for payment system access.

The fintech firm had initially submitted its application in June last year but faced significant changes in financial regulations since then. As a result, Wise's plan to settle U.S. dollar payments directly with the Fed became non-viable due to the Federal Reserve generally pausing account access for uninsured trust banks.

Wise plans to resubmit its application under the GENIUS Act framework, which pertains to digital assets like stablecoins. The company believes its infrastructure is well-positioned to interoperate with digital assets alongside existing payment rails.