Metropolitan Bank to exit crypto-related services, citing 'recent developments'

Metropolitan Bank Holding Corp. ( NYSE: MCB ) said Monday it will exit the cryptocurrency-asset related vertical due to "recent developments" in the digital asset industry, as well as increased regulatory scrutiny of banks' involvement in such services. The move is expected to result in minimal financial impact, the bank, which currently has four active institutional crypto-asset related clients that account for a combined ~1.5% of total revenues and 6% of deposits, said. The New York-based lender noted it started the process of ending its relationships with those clients an expects that process to be completed during 2023. “Today’s announcement of our exit from the crypto-currency related asset vertical represents the culmination of a process that began in 2017, when we decided to pivot away from crypto and not grow the business,” said MCB President and CEO Mark R. DeFazio. In connection with the "recent developments" that drove MCB to put an end to its crypto-related services, the lender likely referred to November's multibillion-dollar collapse of crypto exchange FTX ( FTT-USD ) and the subsequent financial contagion effects. Previously, (Dec. 26) S&P Global warned that increasing crypto deposit outflows are a cause for concern .