Enova International spent nine months and untold legal fees trying to become a bank. On Monday, it gave up — and Wall Street made it pay for the U-turn. The Chicago-based online lender withdrew its regulatory applications to acquire Grasshopper Bancorp, a New York bank holding company, and by Tuesday's close its own stock had been taken to the woodshed, cratering as much as 25% in its worst single session since the pandemic crash of March 2020.

The deal, valued at roughly $369 million when it was announced in December 2025, would have given Enova something nonbank lenders covet and rarely get: a national bank charter, and with it, cheaper deposit funding and freedom from the patchwork of state lending laws that constrain companies serving so-called "non-prime" borrowers. Instead, after nine months of waiting on the Office of the Comptroller of the Currency and the Federal Reserve, Enova pulled its own paperwork before either agency ruled.

Blaming the Referees

CEO Steve Cunningham didn't blame the merits of the deal — he blamed the process. In a statement carried alongside the company's official withdrawal announcement, Cunningham said regulators had encouraged nonbanks to pursue charters but never spelled out what it would actually take to win one.

"Without these clearly articulated standards, the process is susceptible to influence, political pressure and outside advocacy, independent of the merits."

He added, more bluntly, that "our future growth and success do not depend on becoming a bank." The acquisition had also drawn fire from consumer groups worried that a bank charter would let Enova export high-cost lending across state lines, and American Banker reported that a formal denial, rather than a quiet withdrawal, would have set an unwelcome precedent for other fintechs eyeing bank ownership. Enova is treating the move as an application withdrawal rather than a deal termination, though a $5 million breakup fee looms if the merger agreement is formally killed.

Investors weren't interested in the nuance. Shares tumbled to roughly $169, erasing more than $1 billion of market capitalization in a single session, according to Dow Jones Market Data cited in coverage of the rout. It's a brutal reversal for a stock that had been one of the better-performing consumer-finance names this year.

Enova tried to cushion the blow by reaffirming its full-year 2026 outlook — still projecting 20% to 25% revenue growth and 30% to 35% growth in adjusted earnings per share — and by promising to redirect the cash it had earmarked for the acquisition into faster share buybacks. CFO Scott Cornelis said the company has hundreds of millions of dollars of buyback capacity it now intends to put to work.

Whether that's enough to win back skeptical shareholders is another matter. The episode is also a cautionary tale for the broader wave of fintechs — from crypto firms to buy-now-pay-later players — that have spent the past two years lobbying regulators for easier paths to bank charters. If a company as established as Enova can't get a straight answer from Washington after nine months of trying, the message to the rest of the industry is blunt: don't count on it.