The company's London-listed shares fell as much as 11% during intraday trading before partially recovering.
Wise relocated its primary listing to the Nasdaq earlier this year.
U.S. regulators have rejected Wise's application for a full national trust bank charter, citing deficiencies in anti-money laundering compliance.
Shares of the fintech firm Wise traded lower in London after the U.S. Office of the Comptroller of the Currency (OCC) denied its application for a national trust bank license, determining that the company's anti-money laundering and counter-terrorism financing systems were inadequate.
During early European trading on Friday, Wise's London-listed shares dropped as much as 11% before paring some of those losses.
Wise, which has since moved its primary listing to the Nasdaq, stated that since initially filing the application, it has invested heavily in improving processes, risk management frameworks, and anti-financial crime controls both in the U.S. and globally, as well as upgrading various risk management systems.
Wise said it plans to resubmit its application for a national trust bank charter under the Genius Act, a landmark stablecoin bill signed by President Trump. Trust banks generally do not accept deposits or make loans.
In its denial letter, the OCC cited significant regulatory compliance concerns with Wise's application, specifically pointing to long-standing deficiencies in anti-money laundering and counter-terrorism financing efforts at Wise's U.S. subsidiary.
Wise responded by stating it is addressing the issues raised in the OCC's letter regarding the initial application. Since the first submission, the company has strengthened its U.S. risk management framework, enhanced processes for detecting and reporting suspicious transactions, and implemented multiple remedial actions.
Wise indicated that its existing business operations will not be affected by this regulatory decision while it prepares for a new application. The company continues to operate under its existing money transfer licenses in 48 U.S. states and four U.S. territories.
The OCC's decision comes several months after Wise moved its primary stock listing to New York, while maintaining a secondary listing on the London Stock Exchange. When announcing its U.S. listing plans, Wise stated that the U.S. is its most promising market for its products globally.
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