The bank board wants the FDIC to make a decision regarding the application
A small California bank’s merger application could force the FDIC to take a firmer stand on marijuana banking.
On June 14, Oakland, Calif.-based Summit Bancshares Inc. received word from the Federal Deposit Insurance Corp.’s San Francisco Regional Office that the regulator would recommend denial of its application for merger with Faciam Holdings Inc., due to the bank’s business plan to service marijuana-related businesses, or MRBs, according to a shareholder letter. Marijuana is legal for both recreational and medicinal purposes in California, but it is still illegal under federal law.
The bank plans to continue with the merger anyway.
“The Board of Summit has decided to not withdraw the application and to require the FDIC to go on record to deny the application,” Board Chair Shirley Nelson wrote in the letter.
The bank’s board believes the matter is important enough to be decided by FDIC leadership, said Gary Findley, a lawyer with Gary Steven Findley & Associates and legal counsel for the bank. “It’s a policy decision,” he said in an interview.
This is the first time the FDIC has been asked to directly grant or deny a bank access to cannabis banking, according to Findley.
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