Dive Brief:
- Revolut CFO Mikko Salovaara will be departing the digital bank after two years in the top financial seat, the company said Thursday. Salovaara will be leaving for "personal reasons,” according to the Financial Times.
- Salovaara’s departure comes following news that James Radford, the CEO of Revolut NewCo UK — the entity designed to host the digital bank’s U.K. banking license — left the entity in late April.
- Both Salovaara’s and Radford’s departures come as the company faces persistent regulatory challenges, including concerns surrounding its 2021 financial statements flagged by a recent audit.
Dive Insight:
Salovaara joined the London-based digital bank in 2021 as vice president of finance and was elevated to CFO later that year, according to a company press release. Before moving to Revolut, he served as an investor for 3G Capital, and held CFO roles in various markets for the Kraft Heinz Co., according to his LinkedIn profile.
The digital bank has been left in limbo waiting for its U.K. banking license for more than two years, with CEO Nik Storonsky pointing to the recent turmoil in the banking industry as a reason for the current delays, according to the Financial Times. Salovaara said in early March the license would be coming “any day now."
A darling of the digital fintech boom, Revolut’s quick expansion — with the company’s valuation swelling to a peak of $33 billion in 2021 — has been followed by a series of challenges, according to The Guardian. The company has faced lagging technology and IT hiccups, regulatory fines and allegations of a toxic workplace culture that has led to the departure of key company staff over the past few years.
Regulators have slapped the company with penalties over data breaches, late account files and other issues. The company has had regulatory troubles with the central bank of Lithuania, where it received its European Union banking license in 2018. Last November, the central bank fined the company €70,000 for failing to file audited financial accounts on time.
The beleaguered fintech’s regulatory and financial hiccups are also far from over. The company’s independent auditor, BDO Global, has flagged concerns about Revolut’s delayed 2021 financial accounts. BDO was unable to independently verify three-quarters of the €636 million in revenue Revolut reported in its delayed 2021 accounts, it said in its report.
“As described in the basis for qualified opinion section of our report, we were unable to satisfy ourselves concerning the completeness and occurrence of certain revenues for the year ended 31 December 2021,” BDO said in the opinion section of Revolut’s delayed 2021 statements. “We have concluded that where the other information refers to revenue or related balances, these may be materially misstated for the same reason.”
Revolut posted its first full year of profit in 2021, with £26.3 million in net income, it said in March.
Revolut did not immediately respond to requests for comment regarding Salovaara’s departure.
But, according to the Financial Times, Salovaara said he was “grateful for the opportunity” at Revolut and “remain[ed] confident in the firm’s future success."
