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Square noted that its new Financial Services executive team is made of people with in-depth knowledge and experience in banking, finance, and lending.
Shares of American payments company Square Inc (NYSE: SQ) went higher after the company officially launched its own bank. After four years of working on launching its banking operations, Square finally announced the bank launch on the 1st of March. The company’s stock rose about 24 hours after the bank launched.
Growing Square Shares Price
At the time of writing, in the pre-market, Square stock is up 1.49% to $255.96. The company’s stock has grown over its previous close of $252.20 (+4.65%). Square shares have been pulling in increases over the past year ahead of its bank launch. In the last one year, the payments company has grown more than 218%. Also, AQ has jumped 15.88% since the beginning of January. MarketWatch data further showed that Square had increased 24.85% in the last three months and 10.64% over the past month. In the last five days, the payments company has jumped 6.27%.
During the announcement of its bank’s launch, Square said the banking operations have started after completing necessary documentation. Square said it had completed the charter approval process with the Federal Deposit Insurance Corporation (FDIC) and the Utah Department of Financial Institutions (DFI).
The primary purpose of Square’s new wholly-owned bank is to offer deposit accounts and loans to small businesses. The chief financial officer and executive chairwoman at Square Amrita Ahuja commented on the newly-launched bank. She said:
“Bringing banking capability in-house enables us to operate more nimbly, which will serve Square and our customers as we continue the work to create financial tools that serve the underserved.”
Ahuja further appreciated the FDIC and Utah DFI for contributing to the successful launch of Square’s bank. The CFO added that the company hopes to expand access to financial services for small businesses.
Formerly, Square Capital loans were issued to customers through a partnership with Celtic Bank.
Company Onboards Executives for New Bank
In addition, Square noted that its new Financial Services executive team is made of people with in-depth knowledge and experience in banking, finance, and lending. Some of the new executives include Sharad Bhasker as the chief risk officer, Samantha Ku as chief operating officer, and Homam Maalouf as the chief credit officer. Others are David Grodsky as the chief compliance officer, and Jessica Jiang as the capital markets and investor relations lead.
In the announcement, Square added:
“Square Financial Services will continue to sell loans to third-party investors and limit balance sheet exposure. We do not expect the bank to have a material impact on Square’s consolidated balance sheet, total net revenue, gross profit, or Adjusted EBITDA in 2021.”
In January, Square’sCash App platform recorded a surge in first-time Bitcoin buyers. The company said Cash App saw 1 million new Bitcoin buyers in the month. Square is also one of the high-profile investors who invested in Bitcoin. Square holds more than 8,000 Bitcoins.