One of the few US banks to serve the crypto industry, the Metropolitan Commercial Bank, has today announced that it is ending crypto-related services. The bank said that the move was because of the recent developments in the crypto industry.
The move was announced by the New York bank’s parent company Metropolitan Bank Holding (NYSE: MCB).
Exit after strategic assessment of business
In a statement, Metropolitan Bank Holding said:
“This decision follows a careful review by the Board of Directors and management and reflects recent developments in the crypto-asset industry, material changes in the regulatory environment regarding banks’ involvement in crypto-asset-related businesses, and a strategic assessment of the business case for MCB’s further involvement at this time.”
While the bank did not mention it, the recent move could likely be because of the ongoing crypto meltdown after the collapse of FTX late last year. There are also concerns that financial firms involved in the crypto business could be subjected to stricter regulatory oversight in the future due to the rate at which crypto entities are collapsing.
The exit’s financial impact
MCB shares closed last week with a gain of +0.07 (0.12%) on Friday and the bank has said that it expected the plan to exit the crypto market to have “minimal financial impact.”
The bank’s four crypto clients only accounted for about 6% of its deposits and 1.5% of its total revenue. This equates to about $342 million in deposits and $1 million in revenue according to the bank’s 2022 Q3 results reported last year in October.
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