June 29 (Reuters) – Australia’s first neobank, Volt Bank Ltd (IPO-VOT.AX), said on Wednesday it was shutting down its deposit taking business, returning its banking licence and reducing staff numbers after unsuccessful capital raising initiatives.
The neobank, which in February had intended to raise A$200 million ($138.08 million), made the decision after it was unable to secure additional funding to support the business, it said in a statement.
Mortgage broking firm Australian Finance Group (AFG) (AFG.AX) last year had secured about 8% stake in Volt worth A$15 million, local media had reported in February. AFG did not immediately respond to a Reuters request for comment.
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Volt said its had executed a transaction to sell its mortgage portfolio and started the process of returning all deposits to customers in full.
“Volt has taken steps to reduce all expenses and staff numbers, other than those required to support the orderly return of deposits and pursue a realisation of the value of our remaining assets,” it said.
Australia’s prudential regulator in a separate statement said it would closely monitor the process to ensure funds are returned to Volt’s depositors.
($1 = 1.4484 Australian dollars)
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Reporting by Navya Mittal in Bengaluru and Byron Kaye in Sydney; Editing by Rashmi Aich
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