AxiaFunder, Europe’s first for-profit litigation funding platform, has secured £1.9m from investors since launching in January 2019, with a 100% success rate on completed cases.

Co-founded by investment banker Cormac Leech and entrepreneur Sophie Liu, AxiaFunder has fully funded a total of 13 cases via its platform so far, winning all five that have been concluded with an average investors’ return of 55%, and as high as 94%*. Of course, we would like to remind investors past performance is not indicative of future results

The other eight cases remain ongoing including a software case in Barcelona, AxiaFunder’s first international case. Two further litigation investment opportunities have recently been added to the platform.

The current cases at the funding stage include a shareholder dispute case relating to a high-value house building business, and a group litigation claim against two retail banks the funding is in the process of closing.

Cormac Leech, the London-based company’s co-founder and CEO, said one of the key attractions of litigation funding as a new asset class was the degree to which it did not correlate with the broad economic environment.

He said: “Litigation is not largely impacted by variability in economic growth in the same way traditional assets such as equities and bonds are.

“Indeed, there is an argument that litigation funding provides investors with an attractive alternative in times of economic uncertainty.

“With equities at multi-year highs many investors may think it is a good time to diversify out of equities, and litigation funding is an option for some high net worth and sophisticated investors to consider.”

“With the potential high return, investors also need to be aware of the risk of capital loss in litigation funding. Investors can find more information on our website’s risk warning section.”

A multi-stage vetting programme ensures that only those cases with a strong chance of success – approximately one in every 20 cases reviewed by the AxiaFunder team – actually make it on to the platform.

The risk of loss is mitigated by After the Event insurance (ATE insurance), which help to reduce any liabilities of a failed case.

It is compulsory for all cases funded on the platform to have ATE insurance where adverse cost risk exists, and solicitors are typically paid at least partially on a CFA (conditional fee agreement) contingent basis to ensure alignment of interests and to keep costs down.

AxiaFunder is a trading name of Champerty Limited (FRN 811606), an appointed representative of Share In Ltd (FRN 603332), which is authorised and regulated by the Financial Conduct Authority (FCA). AxiaFunder is a member of the UK Crowdfunding Association.

For more information about AxiaFunder, visit https://www.axiafunder.com/

Fintechs collaborate with traditional bank to bring better services to consumers and businesses 

Vivid - the Berlin-based financial platform for investing, banking and saving - and ECOMMPAY - a leading international payment service provider with its own fintech ecosystem for business growth - have today announced a partnership to allow instant Visa and Mastercard card top-ups through Vivid as part of a bespoke mobile-first full-service banking solution. The new banking features will optimise Vivid’s cash flow, making moving money more efficient and convenient. 

This partnership offers consumers across Europe with Vivid’s IBAN accounts access to funds instantaneously, meaning they no longer need to wait days to receive funds via wire transfer. The convenient top-up experience is now available for Vivid’s 100,000+ customers across Germany, France, Italy, and Spain, and is underpinned by ECOMMPAY’s data-driven payments technology, which has been tailored to provide strong customer authentication and security measures that are fully-compliant with PSD2 requirements. All top-ups are enabled in collaboration with Solarisbank AG, which is regulated by the German regulator BaFin. Deposits are covered by the German Central Bank’s Deposit Guarantee Scheme. ECOMMPAY will also enable Vivid users with access to Apple Pay and Google Pay - offering convenience that is 3DS compliant and helping meet consumer demand for mobile payment methods.

By working with ECOMMPAY, Vivid will be able to boost its expansion efforts across the EU as it benefits from enhanced customer experience features, security measures, and comprehensive risk management, through a single, unified integration.

This trailblazing collaboration sees three organisations - leading European fintechs, neobanks, and a traditional bank - partner across various jurisdictions, adhering to regulatory requirements, and uniting new functionalities and data-driven technologies into one process to expedite Vivid’s growth, and offer businesses and consumers the latest banking innovations. The secure payment solution uses ECOMMPAY’s bespoke financial technology and Solarisbank’s German banking license to prioritise convenience and security for the user experience. This non-standard model of cooperation between leading fintechs and a traditional bank under complicated regulatory conditions is pioneering in pursuit of customer success. The partnership marks the beginning of a tech collaboration that will lay groundwork to provide further payment options - such as cashback programs, sub-accounts in foreign currencies, and investment products - as well as expand the offering outside the EU to offer international payment methods for top-ups.

Vladimir Polakov, Head of Sales Force Division at ECOMMPAY, comments: “We at Ecommpay think that there is nothing impossible. Some tasks are simply more complicated than others when growing businesses such as Vivid’s. We pride ourselves on taking action on non-standard business goals and challenges, to find unique and collaborative solutions that change the face of the financial ecosystem. This direct to card top-up option wouldn’t have been possible without the collaboration of leading tech innovators in the financial industry. By putting the end-user first we’ve created a payment option that provides both security and speed.”

Alexander Emeshev, co-founder and CEO of Vivid Money, comments: “This partnership marks a huge step forward for Vivid card users as we continue our pursuits in building a European financial super app. This is the next logical step in offering our account users the capabilities to send, receive, spend, invest and save money in different ways as we scale. Vivid card users get all the benefits of a German IBAN account without having to compromise their personal banking requirements or business necessities across Europe. The arrangement with Visa and Mastercard is as unique as our cards, offering consumers and businesses access to funds instantaneously.”

Today, EedenBull, the leading fintech specialising in B2B commercial payments technology, has announced participation in Mastercard Track™ Business Payment Service to enhance its innovative Commercial Payments as-a-service (CPaaS) solution 

One of the first open-loop B2B commercial networks, Mastercard Track automates payments-related data exchange between buyers and suppliers. Consisting of a portfolio of B2B solutions, it helps businesses increase simplicity, flexibility, and efficiency, optimizing the best option of paying or getting paid for every invoice across multiple payment rails. 

As a result of the tie-up, EedenBull’s fast-growing network of banking partners will benefit from reduced complexity, driving down costs and enhancing the end-user experience for their business and corporate customers. 

The integration demonstrates EedenBull’s commitment to drive modernisation of the B2B commercial payment ecosystem. It marks the next step in its mission for delivering deep payment expertise and cutting-edge technology to banks around the world.

Nicki Bisgaard, CEO and Co-Founder of EedenBull, said: “The global pandemic is accelerating a move towards automated B2B payments and shifting business’ digital expectations in the process. As a result, banks need help optimising their offering to not lose out on customer loyalty or the huge opportunity that lies ahead. This collaboration underpins our commitment to delivering optimised B2B payment solutions to our banking partners, allowing them to meet the complex needs of their business customers.” 

He continues: “EedenBull is delighted to continue its excellent relationship with Mastercard. By joining Mastercard Track, we believe our solution helps to solve some of the most urgent B2B payment challenges today.” 

Eedenbull will use Track Business Payment Service as a Buyer Payment Agent (BPA) by integrating with Mastercard APIs and it will be actively offering the service to its partner banks.

• Product Reviews
• 04.08.2021 11:57 am

What does the product do?

Unizest is a digital app that provides e-current accounts for newcomers to the UK - namely overseas workers and international students. As well as providing accounts direct to customers, we partner with recruitment agencies in order to help them recruit and retain international candidates by providing a much needed digital banking solution, specifically tailored to the needs of non-UK nationals. 

Who needs the product?

It can be difficult to open a UK bank account if you have no residential history or proof of address. This friction makes it hard for people arriving into the UK to work or study to get going - leaving them unable to receive salary payments, or to pay bills or rent via direct debit and bank transfer. The challenge of opening a bank account can also make the onboarding process difficult for the recruitment agencies and HR teams bringing in overseas staff to work: employees need a bank account to be paid into before they can start work. 

What is special about the product?

Unizest has a unique and simple digital onboarding process for non-UK residents; customers can sign up from anywhere in the world, allowing them to set up their account before they arrive in the UK without a need for a proof of UK address or residential history.

Unizest also provides unique offers within the app for discounts on everyday products, SIM cards and train travel, in order to really help new arrivals in the UK get the best possible start. 

We partner with independent and not-for-profit NGOs such as Just Good Work and the Association of Labour Providers to provide and incorporate resources and guidance for overseas workers within the app, around employment rights and practical advice on working and living in the UK. 

What features are relevant?

Unizest customers use an e-account app to manage their money and payments, and on arrival in the UK are sent a Mastercard Debit contactless card to use for secure transactions. The onboarding process links to Home Office Share Code to ensure customers have a confirmed right to reside in the UK, making the set up simple for Unizest users. 

Customers can also enjoy exclusive discounts for everyday spending and practical advice from our partners. 

Who is the competition?

We are providing a current account and as such we compete with some very established players - from High Street banks to newer fintechs and e-money providers such as Monzo or Cash Plus. 

We are very clear about who our target customer is and believe there is clear blue water between ourselves and other providers, both in terms of our desire to serve and the relevance of our product.

We respect all our competitors - after all, we are competitors to our competitors!

What are some real case examples?

We recently spoke to a young man from Hong Kong working at a well known fintech company who told us that he spent three months trying to open a bank account after arriving in London. We understand this is a really common experience for new UK arrivals - and not having access to a bank account in essence locks non-UK nationals out of society.

We hear from recruitment agencies that this happens a lot too - they refer to this group of people as ‘able to work but unable to pay’. We also hear from recruiters that they are still having to pay some people by cheque or cash - something that is a clear identifier of a wider problem.

• Interactive Brokers will use LPA Group’s Capmatix Doc and Data Cockpit solution for regulatory compliance across its entire product range
• A 24/7 automated process will ensure that the correct documentation for every financial product is available and up-to-date 

​LPA Group, (LPA) the capital market technology and innovation leader, today announced that it has been selected by Interactive Brokers Group (Nasdaq: IBKR), the global brokerage firm, to provide a solution for regulatory documentation for its entire range of financial instruments. This includes stocks, bonds, options, and futures in over 135 markets, 33 countries and 23 currencies^[1].

LPA’s solution is its Capmatix Doc and Data Cockpit service: a tailor-made solution which will be able to support Interactive Brokers with an automatic and state-of-the-art solution for providing all the necessary financial product documentation on a daily basis, guaranteeing both regulatory compliance and transparency for its customers.

Ongoing access and provision of the correct documentation in line with regulatory obligations presents a key challenge to international financial companies like Interactive Brokers. The scale of the operation – sometimes ensuring the availability to investors of many million documents in multiple language and variations – coupled with the differing obligations of regulatory regimes such as UCITS, PRIIPs and MiFID often becomes a significant burden for impacted businesses.

The Capmatix Doc and Data Cockpit is used by both manufacturers and distributors on the buyside and sellside and acts as a guard for MiFID II and PRIIPs regulations, protecting from disclosure mistakes for financial products through a maintained repository of latest data and documents.

Cloud-based and automated, the product will analyze Interactive Broker’s product range each day, looking at availability, languages and jurisdictions/domiciles of the relevant documents, linking to the correct source and guaranteeing the right level of coverage for that product. The Capmatix Doc and Data Cockpit will be optimally tailored to the firm’s range of products, recognizing exactly what is required for the current product portfolio in the shortest possible time.

The LPA service will additionally perform ongoing validations of data as part of PRIIPs KIDs requirements, and automatically spot and issue warnings to users regarding non-compliant product information. This level of analysis provided will also facilitate greater sales efforts for each product through accurate documentation.

Based on state-of-the-art technologies such as deep-learning, pattern recognition and the analysis of product data from all sources, the software is continually optimized and can cover a constantly changing and growing portfolio of instruments.

Yochai Korn, Managing Director of Global Financial Information Services & Global Head of Market Data and Research at Interactive Brokers commented: “We are very pleased to be working with the LPA Group. By using the Capmatix Doc and Data Cockpit we now ensure that our customers are provided with the necessary documentation for our entire portfolio – on time, up-to-date and around the clock. With this awareness of document availability, we can actively control our product offering for each of our distribution countries in Europe. This gives us the opportunity to expand our product range and ensure compliance at all times within the framework of product governance.”

Eran Elad, Product Manager, LPA Group added: “Our goal is to always help our customers achieve full compliance and increased efficiency, and we are delighted to work with Interactive Brokers and support their needs in this way. We hope that our collaboration helps the company meet its high-quality standards for customers and regulatory compliance through a modern and forward-thinking approach to technology usage.”

• Industry leader reinvents digital trust, adding pre-transaction behavioral intelligence to prevent financial crime in real-time before it happens, without compromising user privacy or experience
• Game-changing acquisition will culminate in the world’s largest Financial Intelligence Network (FIN), a vault of more than a trillion data points, sessions, and profiles of both good and bad actors
• Addition of Revelock’s technologies advances Feedzai’s vision of creating the most comprehensive cloud-based, AI-powered financial risk management platform
• The platform will pioneer third-generation machine cognition, an evolution on first-generation, rule-based AI models and second-generation statistical machine learning, to create the first unbiased, secure and private financial risk management and crime prevention technology

Feedzai, the world’s leading cloud-based financial risk management platform, announced the acquisition of the most advanced behavioral biometric platform, Revelock. Following a $200m investment round earlier this year, Feedzai’s acquisition creates the world’s largest AI-powered financial risk management platform with native, integrated behavioral biometrics. The integrated platform enables financial institutions and merchants across the globe to detect and prevent financial crime before it occurs. Hyper-granular risk-level assessment bolsters security, maintains privacy, and gives consumers a lightning-fast experience.

The transformational combination of Feedzai and Revelock will create the world’s largest Financial Intelligence Network (FIN), a vault of more than a trillion data points, sessions, and profiles of both good and bad actors. Feedzai Segment of One Profiling uses 150B data points to decide if the transaction is fraud or not. To top this, Revelock brings biometric intelligence from every user, device, and session connecting to the system. Beyond the addition of behavioral biometric data to its platform, Feedzai leverages AI and machine learning expertise to use enriched information in models to create predictive intelligence to stop financial crime in real-time. Feedzai provides end-to-end management of data quality, governance, and usage; keeping every user session anonymous to ensure people are treated as people and not as data points. Other fraud solutions simply add biometric data without usage guidance, creating manual work for data science teams.

Over the past year, ATM withdrawals are down 58 percent in the US (Feedzai), 41 percent of consumers switched from cash to online/phone payments, while 55 percent do not plan to switch back to cash (Zelle). The early days of the pandemic forced many businesses, both small and large, to move to contactless, digital payments to reduce the possibility of exposure to COVID-19, accelerating cashless commerce. Many consumers moved to online banking and commerce, adding convenience, but offering criminals more opportunities to commit financial crimes and increasing the burden of risk to banks, payments processors, acquirers, and merchants.

As the digital economy evolves from barter to crypto, Feedzai recognizes that security is crucial to modern commerce, providing consumers with peace of mind when transacting online, and lowering the risk for financial institutions and merchants.

“Our goal has always been to make digital commerce safe for everyone. Adding Revelock to our clients’ arsenal changes the paradigm from securing transactions in real-time – something we were already doing – to effectively preventing crime before it happens,” said Nuno Sebastiao, CEO of Feedzai. “More than 20 percent of the world’s money flows through Feedzai, and we secure the bank accounts of one in every five people. We already knew what transactions took place for more than 800 million consumers. Revelock adds the intelligence of how a transaction takes place. Combined with the why from using Feedzai’s Responsible AI, we’re moving to the next level of machine precognition. As a result, our clients’ customers have a safe pass throughout their entire digital commerce journey, making their experience faster, more private, and more secure.”

Revelock technology enhances Feedzai’s platform capabilities by providing a robust digital identity solution using state-of-the-art behavioral analytics powered by deep learning. Other digital identity providers focus just on behavioral biometrics, device assessment, phishing, or endpoint malware detection. Feedzai offers comprehensive global intelligence, natively integrated into the platform in a single solution. This critical addition to the Feedzai platform makes it the first end-to-end risk management platform for prevention, detection, remediation, and compliance that will improve the user experience while minimising the burden on anti-fraud and anti-money laundering (AML) teams.

“We created Revelock to help commerce enablers identify whether you are really you when you’re transacting online,” said Pablo de la Riva, CEO of Revelock. “With its hyper-granular, anonymized profiles, Revelock’s technology is capable of detecting the subtle changes in user behavior – such as differences in how you hold your phone or how quickly you navigate a banking app – and predict with confidence whether a session should or shouldn’t be trusted. It can identify bad intentions even from a single keystroke and stop fraud before it occurs, all while safeguarding your privacy and anonymity, even from the people that are protecting you. We are thrilled to see our technology come to its full market potential when fused with Feedzai’s AI expertise, where the combination of our technologies is pushing the boundaries of what can be done to secure modern commerce.”

Through this acquisition, banks, payment processors, acquirers, and merchants can gain better insight into their customers and their transactional behaviours to make more accurate risk decisions, faster, protecting customers from cyber threats such as malware, phishing, and account takeover attempts. Feedzai manages the entire process, from login to checkout, automatically handling biometric and transactional data without adding any manual work for data science teams.

The Feedzai platform, with Revelock, provides customers with the following benefits:

• Holistic financial risk management that scales exponentially as business grows and minimizes capital and operating expenses
• Comprehensive models, rules, labels, and reports that leverage behavioral biometric intelligence from day one
• Unprecedented speed, refinement, and fidelity for the entire risk journey
• Visual modeling so analysts can easily make connections between seemingly disparate fraud events and link the devices used in those events
• Faster investigations enabled by the depth of data at the analyst’s fingertips
• Frictionless, silent, and transparent customer experience
• Seamless integration into Feedzai’s platform with a single UX and UI

Revelock technology will be natively integrated into the core Feedzai platform with historical behavioral biometric intelligence available immediately.

• The GoCardless recurring payments feature is live in Fiskl
• Fiskl customers in 31 countries will benefit from the GoCardless integration
• Small business customers will gain more control over payments with direct debit

Fiskl, the global mobile-first financial management, and accounting solution, today announced a partnership with GoCardless, a leader in account-to-account payments, and the launch of recurring direct debit payments for Fiskl customers.

The partnership between Fiskl and GoCardless delivers to small business customers the most reliable payment method for automated invoices. GoCardless will significantly reduce failed transactions as it eliminates common pitfalls associated with card payments, such as card changes or expiry issues, by leveraging the bank transfer system. For international payments, Fiskl small business customers benefit from favourable and transparent exchange rates, supported by the GoCardless-Wise partnership.

“Timely payments, underpinned by favourable charge fees as well as exchange fees, are critical to our global customer base, whether trading locally or internationally”, said Alina Lapusneanu, Fiskl’s CEO and Co-founder. “Fiskl offers the largest variety of payment options as a platform to its customer base, and we are continually looking for solutions which add value to our customer’s businesses via speed, automation or savings. GoCardless solves several major pain points for our customers, enabling recurring or subscription payments, reducing late payments and providing savings on fees.”

“We’re excited to partner with Fiskl, offering joint customers a new way to collect payments that reduces churn, minimises bad debt, and increases cash flow -- all at a cost significantly lower than cards,” said Hiroki Takeuchi, co-founder and CEO of GoCardless.“This integration also provides merchants easy access to the latest technology, including our new open banking features which enable businesses to take one-off and recurring payments in a single platform. We look forward to growing together with Fiskl and our customers.” 

Report from Moorwand explores the impact of outsourcing to either specialist or generalist providers on fintech growth

Moorwand, a payments solution provider, today launched a report that reveals fintechs who outsource to specialist partners generate nearly £1m in additional revenue. The report ‘Specialists vs. generalists: How do fintechs fuel growth?’ explores why and how fintechs outsource to third parties, the importance of outsourcing for fintech growth, and the impact of working with specialists or generalists on fintech businesses.

To understand why and how fintechs outsource, Moorwand commissioned an independent study of 75 senior decision-makers at fintech firms across France, Germany, Ireland, Lithuania, and the United Kingdom. In particular, Moorwand wanted to understand whether fintechs outsource to specialist partners that provide a specific service, or generalist partners that provide a range of services. The study features contributions from leading technology providers and consulting firms including FN1X, GPS, Pannovate, Polymath Consulting, Ozone API, and W2.

Key findings include:

Fintechs outsource to fuel growth

Fintechs outsource to build out their capabilities quickly and efficiently as well as expand into new markets and new customer sectors. Interestingly, user experience is one area that nearly half of fintechs outsource and 84% see as ‘business critical’. The top three reasons fintechs outsource are:

• Improve the user experience
• Accelerate time to market
• Plug gaps in existing capabilities

Outsourcing consumes nearly one fifth of fintech budgets

With almost one fifth (18%) of total fintech budgets dedicated to outsourcing, selecting a partner is a significant business decision. Furthermore, nearly all outsourced services are considered ‘business critical’ – meaning they are essential to the operations of the business.

Established fintechs outsource more – especially compliance requirements

For nearly all services analysed, established fintechs (five years or over) outsource more than their younger (under four years) counterparts. For example, when it comes to loyalty and reward programmes, 35% of younger fintechs outsource, versus nearly double (67%) for established firms.

100% of respondents agreed that compliance is one of the primary benefits of outsourcing. And when it comes to compliance-related services - from Open Banking to Accounts and Issuing - fintechs who are more established, are also more likely to outsource.

Specialists are perceived as better partners and deliver additional revenue

Fintechs who only use specialists are more likely to rate their relationship as ‘very good’ (86% for specialists vs. 55% for generalists). And this positive relationship also extends to customers, with fintechs that use specialists reporting an increase in customer engagement (91% for specialists vs. 76% for generalists).

When it comes to impact, fintechs that use specialists report additional revenues of almost £1m as a result of their choice of outsourcing partner. And looking to the future, the 75% of the fintechs that are planning on changing how they outsource, plan to use specialist providers.

“For a long time, the fintech sector was characterised by the idea of disruption and competition. As the industry matures, propelled by the arrival of Open Banking, BaaS and more recently Embedded Finance, focus has shifted to collaboration to drive growth,” said Vicki Gladstone, CEO and COO at Moorwand. “The research clearly demonstrates that outsourcing is helping firms to improve the customer experience, expand into new markets and customer segments, and launch new products and services. And it also demonstrates that as a fintech becomes more established, they increasingly work with specialist partners, especially when it comes to compliance.”

“Whether the fintech is big or small, in the UK or France, focused on payments or lending, the right choice of outsourcing partner is critical to fueling growth,” concluded Gladstone.  

The report “Specialists vs. generalists: How do fintechs fuel growth?” can be downloaded here: https://www.moorwand.com/specialists-vs-generalists/

In the second quarter, Commerzbank again generated a positive operating result and achieved a solid operating profit of €570 million in the first half of the year. The Bank benefited from a robust customer business and a low risk result. This contrasted with high one-time charges in the second quarter. Despite these exceptional effects and the booking of a further €511 million restructuring expenses in the second quarter, the Common Equity Tier 1 ratio (CET 1 ratio) remained strong at 13.4% and is even more significantly above the regulatory requirement (MDA).
 
On the journey to a sustainably more profitable bank, Commerzbank reached further milestones. The business model of the digital advisory bank is beginning to gather pace with the initiated launch of the remote advisory centres and the accelerated adjustment of the branch network. Furthermore, the selection process for the future second management level was concluded on schedule, and the voluntary programme for personnel reduction announced this spring got underway successfully. In line with the requirements of the German Federal Court of Justice, the Bank has also started to actively obtain the consent of their customers relating to price adjustments.
 
The Bank made further progress on digitalisation. Customers of Commerzbank are now able to conclude securities savings plans in the banking app directly with their smartphone alongside with the purchase and sale of traditional securities. Since the second quarter, foreign currency transactions have also been possible in the Cash Management App, the mobile assistant for Corporate Clients and Small-Business Customers.
 
The high level of customer orientation of the Bank is reflected in the sustained good customer feedback. All customer groups are very satisfied with the advisory services and the banking apps provided by the Bank.
 
The Bank is proceeding at pace in relation to its sustainability targets. The planned increase in the volume for sustainable financial products to €300 billion by 2025 at the latest has made good progress. The volume already increased to €141 billion in the first six months. The Bank has further set ambitious targets for its operating segments. The Corporate Clients segment is projected to contribute €200 billion and to thereby support the transformation of its customers. The Private and Small-Business Customers segment will deliver €100 billion in the form of sustainable product offerings.
 
“We have achieved a solid operating result in the first half of the year. The implementation of the strategy is right on track. We are driving all strategic initiatives forward and we are also ready to make tough decisions if necessary,” said Manfred Knof, Chief Executive Officer of Commerzbank.
 
In the second quarter of the year, Commerzbank generated revenues of €1,862 million (Q2 2020: €2,273 million). The year-on-year increase in underlying net commission income by more than 7% to €852 million (Q2 2020: €792 million) had a positive effect. Underlying net interest income remained nearly unchanged at €1,139 million compared with the first quarter thanks not least to the increased volume of priced deposits. The high one-time effects had an impact on revenues in the second quarter. CommerzVentures, the venture-capital fund of Commerzbank, delivered a positive contribution of around €100 million. A further €42 million came from Targeted Longer-Term Refinancing Operations (TLTRO) of the European Central Bank (ECB). Negative contributions came in particular from provisions of €66 million for the judgement of the Federal Court of Justice relating to price adjustment measures in the Private Customers business as well as provisions of further €55 million for the Swiss francs loan portfolio of mBank. Additional negative impacts resulted from ending the project of outsourcing securities settlement.
 
The risk result was minus €87 million and is therefore significantly lower year-on-year (Q2 2020: minus €469 million). The loan portfolio remained stable despite the ongoing coronavirus pandemic. This is also illustrated by the continuing low ratio of the non-performing exposure (NPE ratio) at 0.8% (end of March 2021: 0.9%). The additional provision booked last year for coronavirus effects anticipated for 2021 (“top-level adjustment”) was unchanged at €495 million at the end of June compared with the previous quarter.
 
Total costs in the first six months amounted to €3,548 million (H1 2020: €3,403 million). While compulsory contributions at €375 million remained virtually unchanged, the Bank was able to reduce operating costs by €56 million in the first half year. As announced, an exceptional write-off for ending the outsourcing project for securities settlement amounted to €200 million.
 
Total operating profit in the second quarter amounted to €32 million (Q2 2020: €205 million). Excluding one-off effects, the underlying operating profit was at €208 million. The consolidated profit attributable to Commerzbank shareholders amounted to minus €527 million (Q2 2020: €183 million). Without the booked restructuring expenses of €511 million, Commerzbank would have achieved a virtually balanced net result.
 
The CET 1 ratio recorded at the end of June 2021 was 13.4% despite the consolidated loss (end of March 2021: 13.4%). The buffer to the regulatory requirement (MDA threshold) of currently 9.4% increased to around 400 basis points due to the AT 1 issuance in June this year.
 
“In the second quarter, we have kept our Common Equity Tier 1 ratio stable despite the high one-time write-off and restructuring expenses. This again proves that we have a very strong basis for the transformation, and it demonstrates that we are also able to deal with exceptional charges on our way to a sustainably profitable future,” said Bettina Orlopp, Chief Financial Officer of Commerzbank.
 
Development of the segments
 
The Private and Small-Business Customers segment continued its growth trajectory with loans and securities. The year-on-year volume in Germany increased by more than 20% to a total of €319 billion. The primary driver for this development was the securities volume, which increased by a further €11 billion compared with the previous quarter. Out of this, €3 billion were new net money. Thanks to the strong mortgage business, the loan volume also posted an increase of more than €1 billion to €116 billion since the last reporting period. The segment made additional progress with the introduction of deposit pricing, with which the Bank responds to the sustained negative interest environment. The volume of priced deposits rose by €3 billion to €13 billion in the second quarter. Total underlying revenues for the Private and Small-Business segment increased slightly to €1,200 million despite the sustained pressure on the deposit business and the consumer restraint on consumption as a result of the coronavirus pandemic (Q2 2020: €1,190 million). Net commission income in the segment rose by 14% on the back of the strong securities business. Despite the provision of €66 million for the judgement rendered by the Federal Court of Justice as well as provisions of €55 million for the Swiss francs loan portfolio of mBank, the segment generated an operating profit of €138 million (Q2 2020: €108 million). The segment benefited from the low risk result in the amount of minus €62 million (Q2 2020: minus €152).
 
In the Corporate Clients segment underlying revenues slightly decreased to €758 million compared to the second quarter of last year which was defined by a strong capital market business (Q2 2020: €793 million). The Mittelstand division benefited from a slight increase in loan volumes. The International Corporates and Institutionals divisions reflect normalised capital market business and the strategic focus on capital-efficient business. Overall, the segment generated an operating profit of €244 million (Q2 2020: minus €91 million). In addition to lower costs, the main driver for this result was the positive risk result of plus €13 million (Q2 2020: minus €290 million).
 
 

The photography collective introduced DivideBuy’s instant credit and installment payment plan options to make it easier for clients to pay for their photography

Leading LendTech company, DivideBuy, which recently topped Deloitte’s Technology Fast 50 UK, 2020, has announced its partnership with the independently-owned photography business, the Xperience Group.

Working with DivideBuy, Xperience Group now offers its customers the option to split up payments into monthly instalments with no interest attached. The move supports its customers in funding their photoshoots, while attracting new customers who would prefer to split up payments.

Founded in 2014, the Xperience Group is a collection of professional photographers who have united to offer their services across the UK and Ireland and joins DivideBuy’s diverse range of retail partners, offering its customers the option to split up payments into monthly instalments with no interest attached.

Founder, Mark Cleghorn, who originally established the Xperience Group as a photography teaching platform before developing it into a full range of studios, explained, “When DivideBuy first explained to us how instalment-based credit payments could grow our client base and help our customers, I had visions of customers needing to wait a day or so for their credit checks to be approved before we could sign them up, which was no good. But DivideBuy isn’t like that – it’s really quick and easy for our clients to access interest free credit. Honestly, I wouldn't want them to change anything about the process, it’s great.”

The expert lensmen specialise in everything from family portraits, newborn shoots, and pets on the prowl, to B2B corporate events and fashion shots – all with the goal of creating ‘the perfect image’.

James Bradley, Business Development Director for DivideBuy, commented, “Xperience Group is doing some great work in the photography sector, so we’re pleased to be supporting its customers who seek friendly and creative photographers like this collective. Last year, we helped over 800 consumers spread the cost of their images, and that figure is only growing.”

With a focus on responsible lending, DivideBuy’s goal is to make LendTech mainstream by providing an intuitive, interest free credit solution that puts the customer’s needs first; a goal it is achieving, as the company achieved a milestone £100 million in lifetime sales last year. Its partnership with the Xperience Group is part of a wider strategy through which DivideBuy is looking to diversify its retailer base and expand its partnerships into the industries that will benefit most.