After a years-long wait, fintech giant SoFi has finally secured approval from the Office of the Comptroller of the Currency (OCC) and the Federal Reserve to become a bank holding company. 🥳
SoFi acquired a community bank last February in a bid to accelerate the process. The bank, Golden Pacific Bancorp, will operate as the parent company for SoFi Bank. SoFi will immediately see improved economics and fewer middlemen. That’s one reason investors are jazzed about this announcement — shares rose more than 13% since afterhours yesterday. 👏
The approval of the bank charter will also bring on more regulatory oversight, but SoFi will make up for that with the flexibility to issue loans directly and reduce accessory costs. SoFi, already a giant in the student loans and refi business, has turned its attention to products catering to HENRYs (High Earning, Not Rich Yet). In the last year, the company has launched a mortgage business in more than a dozen countries — SoFi also added a credit product in the form of the SoFi 2% Credit Card. 💰
SoFi stock has fallen 13% YTD (and 39% in the past year.) However, with analysts forecasting a five-year revenue growth rate of 28%, you might not have to worry. In fact, with growth of +28%, there might be a lot to look forward to. 😁
$SOFI stock closed at $13.71 (+13.68%) today.