2023-05-19 21:01:08
The Bank of England is considering refusing to grant a banking license to British finance company Revolut, which has access to this power in the European Union and is seeking the same recognition in the United Kingdom, the Daily Telegraph claimed yesterday . Banking regulator PRA, which reports to the central bank, “informed the government in March that it planned to issue” a warning to Revolut and that “the company’s initial (license) application would be rejected. due to concerns regarding his accounts, the newspaper said. However, this warning has still not been issued, and “urgent negotiations are taking place behind the scenes to try to save the license application”, adds the Telegraph. Revolut declined to comment on this information, stressing that the license application is pending. The Bank of England and the Department of Finance also declined to comment.
Revolut made its first annual profit in 2021, but its results for that year were released months late due to pressure from the regulator to improve its internal controls following major flaws in its accounts audit by BDO. . In Revolut’s 2021 financial report, BDO noted that IT systems had not been designed to allow controls over certain user-initiated transactions directly within the group’s IT environment, making their assessment of a party uncertain. of sales. Revolut has since argued that the company grew very quickly and that its IT procedures and systems were, for a time, no longer suited to its size, but that it had remedied these problems.
Concern of the British market regulator
But while Revolut was granted a full European license in 2021, it has been waiting for more than two years to obtain the equivalent across the Channel. This dragging procedure is causing a lot of ink to flow in the United Kingdom, in particular following the recent banking crisis which swept away several American regional banks and saw the emergency takeover of Credit Suisse by UBS. The British press also highlighted the recent departure of several leaders, including that announced in early May of its financial director Mikko Salovaara, “on his initiative”.
Revolut was valued at around $33 billion in 2021, but UK fintech shareholder Schroders recently estimated in its 2022 accounts that the valuation had shrunk by 46%. Revolut announced at the beginning of May that it wanted to increase from nearly 30 million customers currently in the world to 100 million by 2025, and compete with traditional banking players, particularly in continental Europe, by offering consumer credit, for example. The FCA, the British market regulator, also expressed concern in March regarding an “unacceptable risk” for customers and the financial system represented by certain non-bank payment companies, due to “insufficient controls”, without however naming any. none.
Source: AFP
The Bank of England is considering refusing to grant a banking license to British finance company Revolut, which has access to this power in the European Union and is seeking the same recognition in the United Kingdom, the Daily Telegraph claimed yesterday . The banking regulator PRA, which is part of the central bank, “informed the government in…
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