A Nasdaq-listed payments provider has bought a 30 percent stake in a Liechtenstein-based bank. The move underscores the threat from emerging technologies on traditional financial services.
Balzers, Liechtenstein-based Bank Frick said it has sold a 30 percent stake to Net1, which has developed a solution for processing mobile transactions. The deal price wasn't disclosed.
The two firms already work closely together, and the Nasdaq-listed fintech said it needs the bank to expand its offering.
«Our issuing, acquiring, working capital finance and money remittance products and services are completely reliant on having a stable, long-term and strategic relationship with a fully-licensed bank and there is no better way to ensure alignment and longevity than by becoming a meaningful stakeholder in the bank,» Net1 head Serge Belamant said.
Bank's Fintech Expansion
For its part, Bank Frick hopes to enter new markets thanks to Net1, which has a two-year option after the deal closes to acquire a majority stake.
«We will be able to strengthen our current business areas, drive forward our fintech strategy, develop new digital business models and enter new markets,» Frick chairman Mario Frick said. The deal will also allow the two to scale up and more effectively deal with complex regulation.
While fintechs have emerged as a threat to banks, few have teamed up as specifically as Net1 and Frick. The bank decided two years ago that it cannot survive in the embattled private banking industry alone, and decided to expand into payment services, real estate and other areas.
Staff Numbers to Rise
Frick's 70 employees will be retained, and Net1 said it expects staff count to rise. Under the terms of the deal, the bank's controlling shareholder, the a family foundation, will continue to represent the bank as board head until 2023.
Net1 was the most promising in a series of potential investors, chairman Frick said: «We held intensive discussions with all the interested parties.»
