FinTech Futures: Top five news stories of the week – 26 January 2024
Here’s our pick of five of the top news stories from the world of finance and tech this week, featuring Abrdn, EML Payments, Objectway and more.
Abrdn announces £150m cost-cutting drive with 500 jobs on the chopping block
Abrdn to cut 500 jobs
UK asset management firm Abrdn has announced it is implementing a new “transformation programme” in a bid to streamline its operations and bring down costs, with 500 job cuts proposed.
The company says the programme “targets an annualised cost reduction of at least £150m” by the end of 2025, with the job cuts expected to impact group functions and support services across its middle management.
According to its latest trading statement released this week, the firm’s adviser and personal businesses produced “favourable” results by year-end 2023, but its investments business, which has around £367 billion in AUMA, failed to perform as well, with the firm citing structural headwinds, geopolitical uncertainty and high inflation as factors.
CEO Stephen Bird says the move will seek to “restore our core investments business to a more acceptable level of profitability”.
EML Payments to wind down Irish subsidiary PCSIL
EML Payments is winding down its Irish subsidiary, PFS Card Services Ireland Ltd. (PCSIL), with the company stating the business is “no longer commercially viable and sustainable”.
Although presently solvent, the Australian paytech claims PCSIL, the pre-paid card provider it acquired in 2019 for its digital banking and multi-currency offerings, would burn a $13.1 million (AUD 20 million) hole in its pocket during FY24 ” if the business continued to operate in its current form”.
For this reason, the Wicklow-based division was deconsolidated from EML Group and ceased operations on 16 and 17 of January, respectively.
Based on the recommendations of the PCSIL board, particularly those pertaining to “sustained earnings losses”, “unsustainable capital investment requirements” and “limited commercial attractiveness”, Interpath Advisory was instated as provisional liquidator for PCSIL on 17 January following an application with the High Court of Ireland.
Italy’s Objectway doubles down on North American wealth market with acquisition of Nest Wealth
Nest Wealth acquired by Objectway
Italian banking, asset and wealth management software provider Objectway has acquired Nest Wealth, a digital wealth solutions provider based in Toronto, Canada, for an undisclosed sum.
The acquisition will see the Milan-headquartered fintech take ownership of Nest Wealth’s onboarding, account opening and financial planning offerings built for banks, custodians and asset managers.
It will also take charge of the wealthtech’s client portfolio, which includes wealth management firms Raymond James and Manulife Securities, and half of Canada’s six largest banks, including National Bank of Canada and National Bank Independent Network.
Recognising Canada as “one of the top ten most important wealth markets”, Objectway says it will leverage its latest acquisition to further establish its wealth and investment management offerings in the country and in the neighbouring market of the USA in an ‘as-a-Service’ capacity.
Kashable raises $25.6m Series B funding
Employee financial wellness fintech Kashable has secured $25.6 million in a Series B funding round.
The round was led by Californian venture capital firms Revolution Ventures and Moneta Ventures, and also saw participation from EJF Capital and Krillion Ventures.
The New York-headquartered employee financial wellness fintech says it will use the new funds to expand its research and development technology team, with the aim of tapping the wider credit spectrum, refining its underwriting model and developing additional financial wellness services.
Since its inception in 2013, the platform claims to have connected over 2.5 million employees to “low-cost” loans, with the average size of loan being between $3,500 and $4,000.
Pierre Habis to lead consumer banking for Synchrony
Synchrony Bank hires Pierre Habis
Connecticut-headquartered financial services firm Synchrony has appointed former Santander exec Pierre Habis as the new general manager and head of its consumer banking business.
Confirming his appointment via LinkedIn, Habis says he has been tasked “to lead the charge to grow the bank”, effective from this month.
Leveraging 35 years of experience in finance and consumer banking to fulfil this remit, he joins the firm from Santander, where he most recently served as chief consumer banking and digital transformation officer.
Prior to this, he spent much of his early career at Wells Fargo before later transitioning into the role of head of consumer banking for MUFG Union Bank – a position he held for almost 12 years.
