"Erebor Bank, Palmer Luckey's finance startup backed by some of the biggest names in tech, got one step closer to launching after it cleared another key federal hurdle this week. The Federal Deposit Insurance Corp. approved Erebor on December 16 with conditions: The bank is subject to a strict capitalization requirement and must have investors ready to provide more funding if called upon. The bank still requires final approval from the Office of the Comptroller of the Currency."
"Baker said in an email that one of the FDIC's requirements - that the bank invoke a capital-call agreement that would require unnamed parties to chip in more cash if certain triggers occur - is "highly unusual" but "entirely appropriate given the expectation that the bank will be taking on significant risks associated with its tech and crypto-focused business plan.""
The FDIC granted conditional approval to Erebor Bank on December 16, imposing a strict capitalization requirement and a capital-call arrangement obligating investors to provide additional funds if triggered. The bank still requires final approval from the Office of the Comptroller of the Currency after receiving preliminary OCC approval in October. Observers expect potential opening approval in early 2026. Investors including Joe Lonsdale and Peter Thiel previously funded the venture and gave it a reported valuation near $2 billion. Erebor has hired talent from technology and banking circles and intends to serve clients in crypto, technology, and defense sectors.
Read at Business Insider
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