The German neobank N26which further widened its losses in 2021, claims to aim for profitability within two years and is “in battle order” for a future IPO, according to an executive.
“We are ultimately aiming to go public, but by seeking to do so under favorable conditions”, which means “getting closer to profitability”, Jérémie Rosselli, general manager of N26 for France, explained to AFP on Tuesday. and Benelux.
“Our profitability horizon is 24 months away”, i.e. by the end of 2024, he specifies, counting on a mechanical acceleration of revenues as the era of historically low interest rates comes to an end.
N26’s financial accounts for 2021 released on Tuesday show a net loss of 172.4 million euros, against 150.7 million a year earlier.
Net sales increased by 67% to 120.3 million euros, by growing customer deposits which reached 6.1 billion euros at the end of 2021, against 4.0 billion in 2020.
In an environment of rising rates, “the turnover per customer will increase”, estimates Mr. Rosselli.
N26 launched a credit activity in Germany (bank overdraft, consumer credit) and a split payment offer in France, Spain and Germany.
The neobank was imposed last year by the German financial policeman Bafin to limit its new customers to 50,000 per month in its 24 European markets. Its rapid growth risked, according to the supervisor, exposing it to operational risks, for example in the event of a financial shock.
N26 says it continues to invest to comply with regulations, prevent online fraud and move towards the form of “financial holding company”, a prerequisite before going public, according to a press release.
In 2021, it raised more than 900 million dollars (927 million euros) from private investors, bringing its valuation to more than 9 billion dollars (9.3 billion euros), higher than that of the second German bank Commerzbank.
