Why SoFi Acquiring A Bank Is Important For Investors

Fintech company SoFi announced an acquisition on Tuesday that could help its growth road map for the future. 

What Happened: SoFi, which is merging with Social Capital Hedosophia Holdings VCorp IPOE, announced Tuesday it is acquiring Golden Pacific Bancorp GPBI. SoFi is paying $22.3 million to purchase the California community bank with $150 million in assets.

The company plans to contribute $750 million in capital and pursue a national digital banking plan. Golden Pacific Bancorp will operate as a division of SoFi and its physical footprint will be maintained with the existing three physical branches.

Related Link: SoFi Merging With Palihapitiya Backed IPOE SPAC

Why It’s Important: The acquisition is another step by SoFi in pursuing a national bank charter, which will allow the company to accept deposits and make loans using its member deposits rather than the high cost of loan offerings as a non-bank.

SoFi will also be able to offer more choices to its customers.

In October, SoFi received preliminary conditional approval from the OCC for its national bank charter and expects to file soon with the Federal Reserve for “bank holding company status.”

“We believe that by pursuing a national bank charter, we will be able to help even more people get their money right with enhanced value and more products and services,” SoFi CEO Anthony Noto said.

Price Action: Shares of Social Capital Hedosophia Holdings Corp V were up 8% to $17.40 on Tuesday.

(Photo by 金 运 on Unsplash)