- Key insight: Brazil-based Itaú Bank, Latin America's largest bank, was granted a charter to operate in the United States by the Office of the Comptroller of the Currency Aug. 14. The approval was announced Friday afternoon.
- Forward look: Itaú's U.S. subsidiary plans to serve high- and ultra-high-net-worth customers with connections to Brazil and Latin America from a single Miami location.
- What's at stake: The charter approval comes as the OCC approves a number of new bank charters.
WASHINGTON — The Office of the Comptroller of the Currency has granted Itaú Bank a charter to operate in the United States.
Itaú Bank will operate as a subsidiary of the Brazilian banking company Itaú Unibanco Holding S.A, a more-than $600 billion institution based in Sao Paulo. Itaú is the largest bank in Latin America.
In the United States, the bank will target high- and ultra-high-net-worth individuals connected with Brazil and Latin America and will operate from a single location in Miami, Florida. The bank plans to offer products that aren't offered by its existing U.S. affiliates, including deposit accounts, mortgages, credit cards and fiduciary products, according to the OCC.
Itaú's U.S. subsidiary will launch with at least $507 million in capital, according to the OCC's approval letter. That capital will come from the contribution of the ownership interests of Banco Itaú International, an existing Miami-based private bank affiliate, to the new national bank. Itaú Bank also plans to assume substantially all of that affiliate's deposits, liabilities, operating assets and cash.
The bank must apply for membership in the Federal Reserve system and obtain deposit insurance from the Federal Deposit Insurance Corp for the final conditions of the OCC's conditional approval to be met. Final approval will not be granted until the Federal Reserve and FDIC act favorably on the related applications.
The OCC also required the bank to maintain a Tier 1 leverage ratio of at least 8% during its first three years of operation. It must notify the agency of significant changes to its business plan and obtain the OCC's approval before making any substantive changes during its first three years.
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The agency waived requirements for director residency and citizenship, per the bank's request. Four proposed directors received residency waivers, while two received citizenship waivers. The OCC said 66.67% of the bank's board would meet the citizenship requirements following their election.
There are other conditions that need to be met before the bank can begin operations. Itaú must satisfy the OCC's preopening requirements, including establishing its information systems and security programs and completing an independent security review of its electronic banking platform. The bank has 18 months from the preliminary approval date to open for business or the approval will expire, unless they are granted an extension.
Itaú's approval comes amid a slew of charter approvals from the OCC. Dozens of fintech and crypto firms have
