Wise Shares Drop 9 Percent After US Banking Licence Application Rejected

Shares in Wise Group PLC fell 9% to 824p following confirmation that US regulators have rejected the company’s application for a national trust bank charter. The decision, handed down by the Office of the Comptroller of the Currency, represents a significant setback for the payments firm’s US expansion strategy.

The OCC denied the application after raising concerns related to historical compliance issues that emerged after the submission was lodged more than a year ago. According to reports from the Financial Times, regulators highlighted deficiencies in anti-money laundering and counter-financing of terrorism compliance frameworks. The regulator also expressed doubts about whether the company adequately understood the responsibilities associated with traditional banking operations.

The OCC noted that the proposed management team lacked sufficient experience in fiduciary activities, a key requirement for institutions seeking trust bank status. These concerns appear to have been central to the regulator’s decision to refuse the charter.

In response, Wise stated that it has since taken steps to address the compliance concerns raised. The company said it has strengthened its US compliance programme, improved the quality of customer data, enhanced investigation and reporting processes, and increased resources dedicated to financial crime prevention.

The firm emphasised that the OCC’s decision does not impact its current operations in the United States. Wise continues to operate through money transmitter licences covering 48 states and four territories, forming part of the more than 80 licences the company holds globally. Existing services for US customers remain unaffected by the rejection.

Wise also pointed to changes in the regulatory landscape that have rendered its original application unworkable. The Federal Reserve paused direct payment system access for uninsured trust banks, undermining the viability of the company’s initial proposal.

Looking ahead, Wise indicated it plans to submit a fresh application under new rules established by the Trump administration’s GENIUS Act. This legislation created a framework allowing non-bank fintech companies to obtain a limited federal bank charter specifically for issuing dollar-backed stablecoins. The company appears to view this as a more suitable pathway for securing federal banking status in the United States.

The share price decline reflects investor concern about the regulatory hurdles facing the company’s US ambitions, though the longer-term impact will likely depend on the success of any future application under the new legislative framework.