Blue Ridge Bankshares in Charlottesville, Va., plans to roll off certain Banking-as-a-Service relationships in the next year.
The $3.3 billion-asset Blue Ridge said in an investor presentation that its bank contracts with a number of “sub-partners” tied to its fintech partners. About a dozen of those sub-partner Banking-as-a-Service clients are in the process of moving to other banks.
Blue Ridge also said it expects to keep lowering its sub-partner exposure, limiting partners to those with “high account volume and/or small deposit balances per account.” The goal is to reduce compliance oversight.
The plan is to keep offering deposit and lending services to fintechs. Current fintech partnerships account for $721 million of deposit and $50 million of loans at the bank.
The investor presentation comes on the heels of Blue Ridge disclosing that it is “exploring options for raising capital” so its bank can meet certain regulatory capital requirements.
Blue Ridge has been operating under a written agreement with the Office of the Comptroller of the Currency since August 2022. The company said in its presentation that it incurred $7.3 million of remediation costs in the first three quarters of this year tied to the agreement.
Blue Ridge reported last month that it lost $41.4 million in the third quarter, largely reflecting a $26.8 million goodwill impairment charge that was “driven by the pressure” on the company’s stock price. It also included a $6 million settlement reserve for litigation tied to a 2019 acquisition.
The company also suspended its common stock and said it would restate financial results for 2022 and the first half of this year.