FinTech Futures: Top five stories of the week – 2 December 2022
Here’s our pick of five of the top news stories from the world of finance and tech this week.
Crypto exchange Kraken to lay off 30% of staff as it looks to weather crypto winter
Cryptocurrency exchange Kraken is set to lay off 30% of its staff – 1,100 employees – as it looks to “adapt to current market conditions”.
In a post on the company’s blog, co-founder and CEO Jesse Powell says the cuts take the company’s headcount “back to where it was only 12 months ago” following a period of rapid growth, adding the decision will “allow us to sustain the business for the long term”.
Powell says all impacted employees have been notified and will receive “comprehensive support as they transition from the company”.
Kraken joins an ever-increasing list of companies to reduce the size of their workforce in recent times.
HSBC UK set to close 114 bank branches next year
HSBC has announced it will be closing down 114 bank branches across the UK from April 2023, citing customer migration from physical to digital banking.
The banking giant states that over the past five years, use of its branch network by regular customers has fallen by 65%, with footfall in 74% of the closing branches falling by “at least 50%”.
“The decline in branch use has accelerated so much since the Covid-19 pandemic that some of the branches closing are now serving fewer than 250 customers a week,” HSBC says.
As part of its branch network review for the new year, HSBC says it plans to expand the functionality of its digital banking offering and invest “tens of millions of pounds” in updating and improving its remaining branch network.
National Australia Bank expands AWS collaboration with “multimillion dollar” cloud deal
National Australia Bank (NAB) has extended its collaboration with Amazon Web Services (AWS), signing a new “multimillion dollar” long-term cloud deal.
The bank, which has now been working with AWS since 2013, says the move is part of its “ambitious multi-cloud approach” and will enable the firm to “accelerate the migration of key critical workloads to AWS”.
The deal will also see NAB deploy new AWS services such as AWS Graviton to help boost cloud performance. The bank is also currently in the process of rolling out AWS’s cloud contact centre offering Amazon Connect.
Tide to acquire SME finance marketplace Funding Options
UK-based business banking platform Tide is set to acquire Funding Options, a UK marketplace for small business finance, for an undisclosed sum.
The deal will see Tide’s 475,000 small and medium-sized enterprise (SME) customers gain access to more credit options in the near future, accessing Funding Options’ panel of more than 120 lender partners.
Funding Options will operate as a separate brand within Tide while Tide’s existing credit intermediation business will be merged with Funding Options and led by Funding Options CEO Simon Cureton. The firm currently boasts £1 billion worth of demand for business finance from SMEs every month.
HSBC to sell its Canada business to Royal Bank of Canada for $10bn
HSBC is set to sell its banking business in Canada to Royal Bank of Canada (RBC) for a cash consideration of $10.1 billion, subject to regulatory and government approvals.
RBC will acquire 100% of the issued common equity of HSBC Canada. The firm will also buy all the preferred shares and the outstanding subordinated debt issued by HSBC Canada and held by the HSBC Group for an additional $1.5 billion.
The transaction is expected to complete in late 2023.
“We decided to sell following a thorough review of the business, which assessed its relative market position within the Canadian market and its strategic fit within the HSBC portfolio, and concluded that there was a material value upside from selling the business,” explains Noel Quinn, CEO of HSBC Group.