During the period from 2000-2008, there were 1,243 de novo banks; there have only been 95 in the years since then.
We are excited to see Kyle Hauptman, NCUA Chairman and Travis Hill, FDIC Acting Chairman, both eager to support de novos. It’s been a long time since we’ve seen that kind of backing.
More community banks, particularly in rural and/or underserved communities, will be a great help to everyone who lives in those areas.
Will 2025 Be the Year for a De Novo Comeback?
During the last three months of 2024, four new banks opened their doors for the first time. That brought the total number of de novo banks for the year to six (the same as calendar 2023). While still very low (15), the total number of de novo bank openings in 2022 exceeded 2023 and 2024 combined.
What we want to know is whether 2025 will be any better. There are encouraging signs. Already this year, three new bank applications have been submitted along with seven older applications still pending. Six more, that received “conditional” approvals in 2024, are also pending. In order of approval date, they are:
Thrivent Bank, Salt Lake City, UT (FDIC Certificate #59286) was approved on June 20th for deposit insurance as a Utah Industrial Bank. The terms of its approval include a whopping $280 million minimum of paid-in capital; a leverage capital ratio of at least 12% and a minimum total capital ratio of 15%.
As of today, that is the only industrial charter approved and not opened. However, two of the three applications this year are also for Industrial Banks. The criteria is notably more stringent for an Industrial Bank de novo than for a community bank. The paid-in capital required for the five community banks ranges from $27 to $50 million; the Tier1 Leverage Capital Ratio minimum requirement for each is 8% (which must be maintained for the three years). They are:
- 7/29 Greater Gotham Bank, White Plains, NY (59356) with required paid-in capital of $50 million;
- 8/6 BankMiami, Coral Gables, FL(59354) has required paid-in capital of $31.3 million;
- 9/24 Five Rivers Bank, Paramus, NJ (59345) required paid-in capital is $33.5 million;
- 11/21 Elemi Bank, Encino, CA (59353) has required paid-in capital of $25 million; and
- 11/25 Solutions Plus Bank, Albertville, AL (59362) has required paid-in capital of $27 million.
It is important to mention that receiving approval is conditional and does not guaranty the bank will come to fruition. All approvals are conditional on the terms set forth within each. If all conditions are not met, the conditional approval will typically expire after one year.
In fact, according to FDIC records, 86 banks that received conditional approval between 2000 and 2023, failed to make it through the starting gate.
Let’s give props to those that did make it. The four that opened in the fourth quarter 2024 include:
3½-Star Integrity Bank, SSB, Houston, TX (59342), opened on Oct. 11, 2024. By the end of the year it had total assets of $46.6 million and tier 1 capital of $37.9 million. Integrity Bank is proud of its Houston roots and looks forward to being an integral part of the community.
3½-Star Altos Bank, Los Altos, CA (59339), chartered on Nov. 25th, may be able to capitalize on the untimely failures of Silicon Valley Bank (SVB) and First Republic Bank, San Francisco, CA. There was already room for more competition in this affluent area before their departures. The absence of these two big banks has now made the area even more desirable. Altos Bank was already in the planning stages. By the end of the 2024, Altos Bank had total assets of $26.5 million and tier 1 capital of $23.9 million.
3½-Star Fortuna Bank, Grandview Heights, OH (59330) is one of just a handful of women-owned, women-inspired community banks. Fortuna Bank opened for business on December 9, 2024, so it only had three weeks under its belt before its year-end filing. At that time, total assets were $21.7 million and tier 1 capital was $19.9 million. Fortuna Bank does accept out of area CDs via its website and has been added to our rate pages.
3½-Star Gala Bank, Ocala, FL (59358) opened on December 30, 2024, so we’ll wait until the end of the first quarter to see about this one. You will find these four banks, along with all other banks and credit unions established between 2022 and 2024 listed on page 5. (Banks on top; C.U.s on the bottom.)
Not to be overlooked, the NCUA announced a new credit union charter this month as well. Heritage Hub Federal Credit Union, Houston, TX became the first federal credit union chartered in 2025. It plans to open by mid-year and will serve people who live, work, worship, or attend school in an 84-census-tract community within Harris County.
We are excited to see Kyle Hauptman, NCUA Chairman and Travis Hill, FDIC Acting Chaiman, both eager to support de novos. It’s been a long time since we’ve seen that kind of backing. (During the period from 2000-2008, there were 1,243 de novo banks; from 2009 through 2024, there were just 95.)
Representative Andy Barr (R-KY) of the House Financial Services Committee, has also been pursuing ways to lighten the burden of de novos. This year’s iteration of a bill that he has advanced (more than once) in the past, is expected to get better results this time.
We hope it does. More community banks, particularly in rural and/or underserved communities, will be a great help to everyone who lives in those areas.
