In the last days of the wealth manager Schroeder has written off its stake in British fintech revolution. In detail, it Schroders Capital Global Innovation Trust has written off its investment at about 46%. Remember that Schroders has invested in the fintech’s Series E round with a rating of at the top of the market 800 million dollarsclosed in 2021. The Trust stated the value of its interest as at 31 December 2022 £5.4 millioncompared to £10.1m at 31 December 2021. This implies a reduction in the bank’s rating from 33 to $17.7 billion. Revolut isn’t the only fintech company in Schroders’ portfolio to be downgraded: the trust also downgraded its holding nuclear bank by 31%.
The reasons for the devaluation
Schroders said it was “acting cautiously given the challenging market environment”. The devaluation was based on the submission of the Revolut accounts in 2022in which it announced it had made its first annual profit (£110.3m) after almost tripling its revenue in 2021.
The annual accounts have been approved by the auditor of the company, BDO extensionbut with some limitations. The auditor expressed concern that the configuration of Revolut’s internal IT systems meant he could neither verify £477m of revenue nor guarantee its “completeness or repetition”. The risk of material inaccuracies was greatest for the company’s foreign exchange, asset and cryptocurrency trading businesses.
Revolut was subsequently criticized by shareholders and board members for not responding to BDO’s comments. A spokesman for the fintech said the shortcomings reported by BDO have been addressed in 2021 and there are no longer any question marks over revenue reporting.
Who is Revolut
Revolut is a British fintech company founded in London in 2015 by Nikolay Storonsky and Vlad Yatsenko. Since then, it has grossed $2 billion in 19 rounds. The company offers banking services including a prepaid debit card, currency exchange, cryptocurrency exchange and peer-to-peer payments. It has over 25 million retail customers worldwide. Remember that Revolut introduced 22 new tokens in August 2022.