Davis Polk partner and Financial Institutions co-head David Portilla was quoted in Future Nexus discussing the increase in bank charter applications and preliminary approvals, and how this wave of new banks will reshape American banking.

On the process of receiving a bank charter, David analogized, “If you think of chartering a bank like building a house, getting your preliminary conditional approval is like getting all of your permits that let you start construction. Then, much later, you have to get your certificate of occupancy, which means you can move in.”

However, he noted, “I would not assume that every single institution that receives preliminary conditional approval will receive final approval.”

The article noted that one of the most strategic decisions facing fintech companies is which type of charter to pursue. The choice involves complex tradeoffs between capabilities, regulatory burden, and strategic positioning.

“The way I’ve approached this is you have to think of the products and services that you would like to use the bank to offer,” David said. “Then you have to look at the attendant regulatory standards that attach to each different charter type. And then you have to decide whether the particular matrix of products and services you want to offer are worth the organization taking on the regulatory requirements attached to the charter that allows you to offer those products and services.”

David noted he sees a pattern emerging: “I think you’re going to see a second wave of charter applicants that fall more into the full service bank category…those companies just make decisions and engage in business planning in a different way.” 

Speaking about the long-term evolution of the system, he explained, “Financial regulatory policy is an exercise in continually evaluating the balance between growth and innovation on the one hand, and financial stability on the other. [Innovation benefits consumers, drives competition, and pushes other firms to do more.] That to me seems incontrovertibly good for the system.”

Noting that he believes the momentum will continue, David said, “I think clearly the message from the OCC is that they’re open for business. And I think as long as they continue to make that message clear, there’s appetite in the market to charter new banks.”

“The Bank Charter Gold Rush: What’s Really Happening and What it Means for Banking,” Future Nexus (February 12, 2026)

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