Major bank BPCE acquires challenger bank Fidor

Major bank BPCE acquires challenger bank Fidor

BPCE, the second largest banking group in France, has acquired German challenger bank Fidor.

Fidor will remain as an independent business and says it will “capitalise on the support” of BPCE to expand and continue the development of its proprietary digital banking technology.

Founder and CEO Matthias Kröner will continue as the chief executive of Fidor, keeping a shareholding in the bank and leading its business strategy as before.

Kröner says: “In a world of increasing volatility, it is important to be member of a strong group and this transaction is strongly improving our overall financial sustainability.”

François Pérol, chairman of BPCE, says the acquisitions shows that it is “more involved in the digital and mobile banking field”.

Fidor will also adjust its internal structure, with the new Fidor Holding Group acting as a parent company to the rest of Fidor’s business offerings – Fidor Bank, the challenger bank; and Fidor, the digital white-label technology solution.

The closing of the transaction will be subject to customary regulatory change of control approval from the European Central Bank, BaFin and upon clearance from the German competition authority. It is expected to close in Q4 2016.

More on Fidor and challengers

Founded in 2009, Fidor has developed its own proprietary technology platform – the Fidor Operating System (fOS) – for API banking. The solution is offered to other banks and FIs in Germany and beyond, with a recent taker being an SME banking start-up in Berlin, Penta Bank.

Fidor launched its retail banking in the UK in September 2015, and plans to expand its services into Europe in the coming months. It says it has over 350,000 online community members in Germany and the UK, with a customer base of over 120,000.

A year earlier, the bank tied up with a Russian financial group, Life, to launch its business in Russia. However, Life, which controlled a number of domestic banks, lost its banking licence and collapsed in 2015.

This week, Telefónica Germany also announced the launch of O2 Banking, its mobile-only bank account, in partnership with Fidor.

Meanwhile, another mobile operator, Orange, is also planning a digital bank launch. Orange has recently acquired 65% of shares in a French financial services firm, Groupama, and will be launching a 100% mobile banking service in early 2017.

In a feature for Banking Technology, Devie Mohan looked at “Challenger banks: kick-starting survival mode” – and the long-term trends in the sector.