On March 7, the Office of the Comptroller of the Currency (OCC) issued a significant update regarding the involvement of national banks and federal savings associations in cryptocurrency activities. Interpretive Letter 1183 reaffirms the permissibility of various crypto-asset activities and aims to streamline the regulatory process for banks engaging in these activities.

Troutman Pepper Locke advised Performance Trust Capital Partners, LLC in the successful completion of Chesapeake Financial Shares, Inc.’s private placement of $25 million in fixed-to-floating rate subordinated notes. The offering, which was significantly oversubscribed due to robust investor demand, will provide Chesapeake Financial Shares, Inc. with the capital needed to pursue growth opportunities and strengthen its balance sheet. For more information, read the press release.

According to news sources, including Reuters, on Friday, February 21, the U.S. Securities and Exchange Commission (SEC) reportedly informed regional directors at its 10 regional offices that it plans to eliminate their roles as part of cost-saving measures required by the new administration. The plan to remove the regional directors has not been made public at this time, but at least two anonymous sources reportedly spoke to Reuters about the announcement made on Friday.

On January 16, U.S. Representative Andy Barr (R-KY) introduced H.R. 478, the “Promoting New Bank Formation Act,” which was referred to the Committee on Financial Services. This bill aims to support the establishment and growth of new financial institutions, particularly in rural areas, by easing regulatory requirements.

On January 14, Patriot Bank, N.A. entered into an agreement with the Office of the Comptroller of the Currency (OCC) to address and rectify several unsafe or unsound practices and violations of law. This agreement follows the bank’s reported loss of nearly $27 million for the quarter ending September 30, 2024.

Financially distressed companies have several alternatives to Chapter 11 bankruptcy, including workouts, assignments for the benefit of creditors (ABC), and Chapter 7 liquidation. Each option has distinct processes and impacts on creditors, which are crucial for understanding how to navigate these situations effectively. In a workout, companies negotiate debt modifications directly with creditors, allowing the business to continue operating while restructuring its debt.

We are pleased to share our annual review of regulatory and legal developments in the consumer financial services industry. With active federal and state legislatures, consumer financial services providers faced a challenging 2024. Courts across the country issued rulings that will have immediate and lasting impacts on the industry. Our team of more than 170 professionals has prepared this concise, yet thorough analysis of the most important issues and trends throughout our industry. We not only examined what happened in 2024, but also what to expect — and how to prepare — for the months ahead.