Australia's first neobank Volt to shut deposit taking business, return licence (updated)

Australian Finance

29/06/2022 01:24

(Updates with background, APRA comment)
    June 29 (Reuters) - Australia's first neobank, Volt Bank Ltd
 IPO-VOT.AX , said on Wednesday it was shutting down its deposit
taking business, returning its banking licence and reducing
staff numbers after unsuccessful capital raising initiatives.
    The neobank, which in February had intended to raise A$200
million ($138.08 million), made the decision after it was unable
to secure additional funding to support the business, it said in
a statement.
    Mortgage broking firm Australian Finance Group (AFG)
 AFG.AX  last year had secured about 8% stake in Volt worth A$15
million, local media had reported https://www.afr.com/street-talk/volt-bank-pitches-investors-for-200m-series-f-raising-20220201-p59suh
 in February. AFG did not immediately respond to a Reuters
request for comment.
    Volt said its had executed a transaction to sell its
mortgage portfolio and started the process of returning all
deposits to customers in full.
    "Volt has taken steps to reduce all expenses and staff
numbers, other than those required to support the orderly return
of deposits and pursue a realisation of the value of our
remaining assets," it said.
    Australia's prudential regulator in a separate statement
said https://www.apra.gov.au/news-and-publications/apra-monitors-volt-return-of-deposits
 it would closely monitor the process to ensure funds are
returned to Volt's depositors.


($1 = 1.4484 Australian dollars)

 (Reporting by Navya Mittal in Bengaluru and Byron Kaye in
Sydney; Editing by Rashmi Aich)
 ((Navya.Mittal@thomsonreuters.com;))