ATTORNEY GENERAL TONG JOINS COALITION URGING FEDERAL GOVERNMENT TO DENY OPPORTUNITY FINANCIAL MERGER

The following information was released by the office of the Connecticut Attorney General:

Merger Would Grant OppFi a National Bank Charter, Allowing Triple-Digit Interest Rates

(Hartford, CT)- Attorney General William Tong joined a coalition of 17 attorneys general today in sending letters to the Office of the Comptroller of the Currency (OCC) and the Federal Reserve Board (FRB), urging the agencies to deny Opportunity Financials' (OppFi) application to acquire and merge with BNC National Bank, which would grant OppFi a national bank charter and enable the company to circumvent longstanding state lending laws.

OppFi is an online lender that targets consumers with financial struggles or low credit scores and offers installment loans with interest rates reaching nearly 200% APR. While OppFi advertises its loans as affordable and claims it provides a pathway to a better financial future, the reality is that borrowers often default on or refinance OppFi loans because they are unable to repay loans that carry triple-digit interest rates.

In their letters, Attorney General Tong and the coalition argue if OppFi gains a national bank charter and becomes a bank holding company, it would create an exponential increase of unaffordable, high-cost loans that would pose significant safety concerns for consumers, small businesses, and the entire banking system. OppFi would also be able to circumvent important state laws that protect consumers from such high-interest loans and significantly weaken the ability of state attorneys general to fight back.

"Connecticut families deserve access to fair, affordable credit, not loans designed to keep them in debt. This merger is an attempt to evade state consumer protection laws and expand a business model built on outrageous interest rates. We're urging the OCC and FRB to deny this merger and protect consumers," said Attorney General Tong.

Attorney General Tong and the coalition explain in their letters that 45 states and the District of Columbia have state laws that prohibit such high interest rates. Today, given our state's strong history of enforcement against high-cost lending, OppFi does not offer its loans here. But with a national bank charter, it would start peddling its triple-digit-interest loans to Connecticut residents.

To expand its high-cost lending and avoid the legal challenges involved in rent-a-bank partnerships, OppFi now seeks to acquire and merge with nationally chartered BNC National Bank to gain a national bank charter. It then plans to relocate BNC headquarters to Utah. If regulators allow this transaction, the company would take advantage of the National Bank Act's provision allowing nationally chartered banks to charge the maximum interest rate permitted in their home state. This would give OppFi free license to bypass state rate caps and offer its triple-digit interest loans throughout the country.

Attorney General Tong and coalition claim that if OppFi or other lenders with similar business practices become national banks, it would prevent states from protecting their consumers, set a dangerous precedent that could open the doors to other high-cost lenders gaining federal preemption over state consumer protections, and erode the integrity of the national banking system.

Joining Attorney General Tong in sending these letters are attorneys general of Arizona, California, the District of Columbia, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, New Jersey, North Carolina, Oregon, Rhode Island, Vermont, Virginia and Washington.