Revolut has offered to withdraw its application for a UK banking license, according to the Mail.
With rumors growing that the Bank of England was about to reject its two-year-old approval application, the fintech giant is believed to have asked officials if it should abandon its efforts.
But he has received reassurance that the process is ongoing and his application is still under review — even after his auditor said parts of his overdue accounts were “materially misstated.”
The revelations followed more than two months of turmoil at Revolut as executives suggested the license would be granted “immediately”, possibly within a few days.
The company’s impatience appeared to have flared up earlier this month when Revolut boss and co-founder Nick Storonsky lamented the “long and tedious process” and warned that the UK was not a good place to do business.
Mixed fortunes: Revolut, co-founded by Nick Storonsky (pictured), famously asked officials if it should abandon its efforts to secure a banking license.
But the explosion drew criticism from onlookers, with one analyst warning that “hysterics” would not help Revolut secure a license.
It was reported last night that Bank of England regulators planned to reject the application.
The bank’s Prudential Regulatory Authority (PRA), which is responsible for issuing licenses, told the Treasury in March that Revolut’s initial application would be rejected within weeks over concerns about its balance sheet, The Telegraph reported.
This will be a devastating blow to the company, which has been trying to get regulatory approval since 2021 to expand its services in the UK by accepting deposits and lending.
License applications must be approved by two regulators, the Financial Conduct Authority (FCA) and the PRA.
However, this statutory warning has yet to be passed on to Revolut, and the tech firm is now in urgent negotiations to salvage its license hopes.
Once a formal warning is issued, the company has up to a month to challenge it.
Experience: Veteran fund manager Martin Gilbert is the chairman of Revolut.
In addition, a final notice of the decision is sent.
Once the darling of British tech, Revolut was called a “brilliant” success by Chancellor Jeremy Hunt.
This has attracted City heavyweights such as veteran fund manager Martin Gilbert, who is chairman of Revolut.
But fate has since turned, and the rejection will add to the long list of injuries Revolut has suffered this year, including many high-profile employees leaving the company.
Chief Financial Officer Mikko Salovaara resigned earlier this month for “personal reasons”, UK bank head James Radford resigned in March and group COO Michal Laube stepped down in February.
Salovaara’s departure came just two months after the group released their financial statements.
They showed the company made a profit in 2021, but its BDO auditor issued a warning that some of its earnings may have been “materially misrepresented.”
This included three-quarters of her £636m 2021 income, which BDO said it could not independently verify.
At the time, Salovaara insisted that Revolut was looking to get a banking license in the UK “any day now”.
The Mail understands that Revolut now hopes to receive an unqualified audit opinion from the BDO in three months.
The company said in a statement: “We have agreed with the Bank of England that we will not comment on the current application for a banking license.”
The Bank of England and the FCA declined to comment.