Wendy Cai-Lee, also the New York-based bank’s founder, also said “time will tell” as to whether newly chartered entities can withstand examination scrutiny.

Fintechs’ and nonbanks’ pursuit of charters may change the landscape, but the CEO of Piermont Bank is watching to see how newly chartered entities handle their regulatory responsibilities.

“It's one thing to get a charter,” Wendy Cai-Lee, founder and chief executive of the New York-based digital commercial lender, said in an interview last week at the Money20/20 conference in Las Vegas. “It's a whole other thing to be able to get a good CAMELS rating from your annual safety and soundness exam.”

Cai-Lee was referring to the ratings system that assesses a bank’s capital, asset quality, management, earnings, liquidity and sensitivity to market risk.

As regulators have signaled openness to novel charters, fintechs and other nonbank firms have pursued national bank charters, trust charters and industrial loan company charters, which is poised to reshape the bank partner business.

Within the federal banking agencies, staff approving charter applications are completely separate groups from those in risk management, and “they look at banks from very different angles,” Cai-Lee said.

“How well you execute against your plan, that's when the examiners come in,” she said. For many of these newly chartered companies, “time will tell.”

Over the next year or two, Cai-Lee is tracking “how well they do, and what type of role they will play and what type of impact they will” have.

The CEO said she tells her team that marketplace noise is ever-present.

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