WellPoint gets go-ahead from the Federal Reserve for bank

The health plan is one approval away from establishing its own institution.

By Emily Berry, AMNews staff. Oct. 1, 2007.

WellPoint has received conditional approval from the Federal Deposit Insurance Corp. to establish its own bank, which the company says will administer health savings accounts for members enrolled in consumer-directed health plans.

The FDIC issued its conditional approval on Sept. 11. That was four days after the Federal Reserve ruled in an order dated Sept. 7 that WellPoint's banking activities would be complementary to its insurance business.

The FDIC asked the Fed for its opinion because the agency had placed a 12-month moratorium, which expires in January 2008, on all applications for deposit insurance for industrial loan companies, state-chartered, nonbank-owned institutions that may lend money. The FDIC imposed the moratorium after opposition arose to industrial loan applications by Wal-Mart and Home Depot. The Fed opinion means WellPoint is compliant under the Bank Holding Company Act, and thus is not subject to the moratorium.

WellPoint now awaits approval from Utah regulators for a charter there before preparing to open for business. Darryle Rude, supervisor for industrial banks at the Utah Dept. of Financial Institutions, said the state had been awaiting federal approval before considering WellPoint's application. He said the agency could act on the application as soon as 30 days from the federal approval order.