Banking and Finance Law Daily Wrap Up, MERGERS AND ACQUISITIONS—OCC grants conditional approval for Erebor Bank charter, (Oct 16, 2025)

By Shashi Kant, BALLB, LLM.

The OCC conditionally approves Erebor Bank’s national charter, allowing a tech-focused, crypto-integrated bank to proceed under strict regulatory oversight.

The Office of the Comptroller of the Currency (OCC) announced its conditional approval of the de novo national bank charter for Erebor Bank, National Association, based in Columbus, Ohio. The OCC stated that Erebor met the regulatory and policy requirements for preliminary approval and emphasized that the same standards were applied as with any other charter application. The charter marks the first de novo approval since Comptroller Jonathan V. Gould assumed office. The OCC’s decision enables Erebor Bank to proceed with organizing and meeting conditions before final approval and opening.

Scope of approval; business model. According to the OCC’s Oct. 15, 2025, conditional approval letter, Erebor will operate as a full-service insured national bank targeting technology companies and ultra-high-net-worth individuals engaged in virtual currency use. It will offer lending and deposit products, hold limited amounts of non-asset-backed virtual currencies to pay blockchain transaction fees, and provide related services. The OCC determined that limited crypto-asset holdings for gas fee payments qualify as incidental to the business of banking under 12 U.S.C. §24 (Seventh) and 12 C.F.R. §7.1000(d)(1).

Merger and structural approvals. The OCC’s decision allows Erebor Group, Inc. (EGI) to merge into the new bank under 12 U.S.C. §215a-3 and 12 C.F.R. §5.33(g)(4), treating the merger as a covered transaction under Regulation W. The agency exempted the transaction under 12 C.F.R. §223.42(i) after reviewing safety and soundness considerations and approving EGI’s asset purchase. Following the merger, EGI’s subsidiary Atticus Digital, Inc. will become a wholly owned subsidiary of the bank, and Erebor will not have a holding company.

Regulatory conditions and supervisory oversight. The OCC attached several conditions to the approval. Erebor must provide 60 days’ notice before any material deviation from its business plan and receive a written determination of no objection. The bank must maintain a Tier 1 leverage ratio of at least 12 percent for its first three years, obtain OCC non-objection for senior executive or director appointments, and engage an independent auditor. Erebor must also implement comprehensive policies addressing compliance with the Bank Secrecy Act, anti-money-laundering standards, sanctions compliance, credit risk management, cybersecurity, and information systems oversight.

Operational framework. The bank’s main office will be in Columbus, Ohio with a New York office that will not be open to the public. Erebor’s business model centers on serving technology companies involved in artificial intelligence, defense, and digital assets, as well as high-net-worth clients. It plans to facilitate stablecoin transactions and payments using blockchain infrastructure while remaining within the federal banking regulatory framework. Erebor’s proposed activities include accepting virtual currency as collateral for loans and offering credit, deposit, and payment services to businesses and select individuals.

Application and confidentiality requests. Erebor’s charter application, filed June 11, 2025, by counsel at Skadden, Arps, Slate, Meagher & Flom LLP, sought OCC approval under 12 U.S.C. §§ 21 and 24 (Seventh) and requested confidentiality for proprietary business information under FOIA exemptions. The application outlined Erebor’s intent to operate nationally without branches, apply for Federal Reserve membership, and seek deposit insurance from the Federal Deposit Insurance Corporation (FDIC) after preliminary OCC approval.

Fundraising and regulatory context. An AOL Business Insider report on Erebor’s fundraising memo indicates that the bank expected to receive its charter in under six months from application, citing connections between its founders and federal banking officials, including Comptroller Gould. The memo referenced political relationships and prior contributions to Republican committees. The OCC declined to comment on specific connections but reiterated that all applications are reviewed under statutory and regulatory standards. Erebor’s investors reportedly include Founders Fund and 8VC. The startup positioned itself as a technology-focused bank aiming to provide services to the digital asset sector. According to the OCC filings, Erebor’s financial model emphasizes high liquidity and limited crypto-asset exposure for operational purposes.

Political response. Senator Elizabeth Warren (D-Mass.), ranking member of the Senate Banking Committee, issued a statement criticizing the approval, describing Erebor as aligned with major donors and warning that expedited approval could create systemic risk and potential taxpayer exposure.

OCC’s position, next steps. Comptroller Gould stated that the OCC does not impose blanket barriers on banks engaging in digital asset activities if conducted safely and soundly. The agency described the conditional approval as part of maintaining a dynamic and diverse federal banking system. The OCC noted that final authorization for Erebor to open will depend on satisfying pre-opening requirements, including deposit insurance and capital adequacy verification.

Attorneys: Mark Chorazak and Wendy Goldberg (Skadden, Arps, Slate, Meagher & Flom LLP).

Companies: Atticus Digital, Inc.; Erebor Bank, N.A.; Erebor Group, Inc.

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