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Breaking News : UK Authority prohibits business from British Wirecard subsidiary

Wolfgang Holzem

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The British financial regulator FCA has de facto prohibited the Wirecard subsidiary Wirecard Card Solutions from doing business.

The company was not allowed to carry out any regulated activities due to the insolvency of the parent company and had to inform its customers about it, the FCA said on Friday.

No money should flow away either. Among other things, the Wirecard subsidiary provides payment services in Great Britain. Several start-ups such as the N26 rival Revolut also use Wirecard’s services for their offer.

Other payment providers such as Payoneer, Curve and Holvi and even Crypto.com MCO Visa Cards have all been suspended with hundred’s of thousand users been left in the dark.

Former founder of Asiarooms.com and now reporting mainly on the Asia Pacific region and the global Coronavirus crises in countries such as Thailand, Germany & Switzerland. Born near Cologne but lived in Berlin during my early teenage years. A longterm resident of Bangkok, Udon Thani, Sakon Nakhon and Phuket. A great fan of Bali, Rhodes & Corfu.

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Holvi Mastercard temporarily suspended due to Wirecard insolvency

Wolfgang Holzem

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Holvi Mastercard has been temporarily suspended due to recent events in connection with the insolvency of Wirecard AG

How did this happen?

The UK Financial Conduct Authority (FCA) has suspended service for Wirecard Card Solutions Ltd (WDCS) earlier today. WDCS is a subsidiary of Wirecard AG and issues the Holvi Business Mastercard. This decision was taken by the FCA without any prior notice.

What does this mean for you?

All other functions of your Holvi account are still fully available. You can still invoice, receive and transfer funds. Please be assured that all Holvi customer accounts and funds remain safe, secure and accessible at all times – no Holvi accounts have been impacted by this event. This is because all Holvi customer funds are segregated and held in separate accounts in European banks in Finland, Sweden, Denmark, the UK and France.

No customer funds are held by Wirecard AG. Your money and Holvi account are safe.

Your trust is our top priority. We’re actively working on a solution and will continue to update as soon as possible.

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Wirecard : Informs Clients & B2B Partners about current Business Operations

Wolfgang Holzem

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As announced on Thursday, 25 June 2020, the Management Board of Wirecard AG has filed an application for opening of insolvency proceedings on behalf of Wirecard AG with the competent Munich Local Court. With the filing of the insolvency application, Wirecard’s business activities will be continued. The Management Board is of the opinion that continuation is in the best interests of the creditors.

As a first step, the court has commissioned the Munich lawyer Dr. Michael Jaffé as an official expert. Whether insolvency proceedings will be opened is still under review. The Management Board of Wirecard AG expects a provisional insolvency administrator to be appointed for Wirecard AG shortly.

The business operations of the Group companies (https://www.wirecard.com/contact/worldwide) including the licensed units are currently ongoing. The parent company performs some central functions for the subsidiaries. As previously reported, it is being continuously reviewed whether insolvency applications also have to be filed for subsidiaries of the Wirecard Group. With the exception of a small development branch office, no insolvency applications have been filed by Group companies at present.

Wirecard Bank is currently not part of the insolvency proceedings. the electronic funds transfer of Wirecard Bank are not affected. Payouts to merchants of Wirecard Bank will continue to be executed without restrictions. Further information on Wirecard Bank AG can be found at wirecardbank.com. The licensed legal entities, and where appropriate, Wirecard AG, remain in close contact with the respective regulators. Furthermore, we are in constant contact with the credit card organizations.

Wirecard Card Solutions Limited, headquartered in Newcastle, UK, has suspended its business operations due to an order issued by the competent supervisory authority, Financial Conduct Authority. The company has discussed measures with the authorities. The measures are being undertaken and will hopefully enable it to continue operations.

The TPA business in question is still under review. The newly appointed CEO of Wirecard AG, James H. Freis, Jr., took a new approach to investigating the known allegations immediately upon taking office. Among other measures, a number of new advisors were commissioned to ensure neutrality and, in particular, independence from the former Management Board members of Wirecard AG. The clarification efforts will, of course, continue even after the filing of the application for the opening of insolvency proceedings.

Contact:
Iris Stöckl
VP Corp.Com./IR
Tel.: +49 (0)89-4424-1424
e-Mail: iris.stoeckl@wirecard.com
http://www.wirecard.com
ISIN DE0007472060
Reuters: WDI.GDE
Bloomberg: WDI GY

Document pulled via Reuters Terminal by Wolfgang Holzem on behalf of Dr. Robert Bowitz, accredited by the German BDP
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Deutsche Bank is considering taking over Wirecard Bank

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At the beginning of the week it still looked as if Wirecard’s Bank would also go into bankruptcy because too much customer money had meanwhile flowed out – now it is becoming clear that Deutsche Bank could take over in whole or in part. The Bank is examining possible financial aid in coordination with BaFin, the insolvency administrator of Wirecard AG and the management board of Wirecard Bank, a spokesman said.

According to German media reports, at least one financial investor has also expressed an interest in Wirecard Bank.

The financial supervisory authority Bafin had appointed the Bundesbank as a special representative at Wirecard Bank, who should ensure that no funds flow to Wirecard AG and that business continues.

Wirecard Bank has a full banking license and can offer all financial services. Since the beginning of the year, it has been promoting 0.75 percent interest on checking deposits on the “Boon Planet” banking app, while other institutes hardly pay any interest or even charge fees for fixed deposits.

If the bank had gone bankrupt, the deposit guarantee fund of the private banks would have compensated customers who did not withdraw their money on time.

On the balance sheet, Wirecard Bank is not a heavyweight. According to internal sources, at the end of March it had total assets of 1.6 billion euros, which roughly corresponds to a medium-sized savings bank. The equity at the end of the quarter was 205 million euros and he bottom line was a surplus of 4.7 million euros at the end of the quarter, after 40.8 million in the same quarter of the previous year.

What motives drive Deutsche Bank is still unclear. “We are one of the largest banks in the payment traffic worldwide and that is one of our strengths, a real core business area,” Deutsche Bank board member Fabrizio Campelli told Handelsblatt in an interview published on Friday and “if there are opportunities to strengthen ourselves, we will look at them.”

Deutsche Bank may be targeting Wirecard Bank’s corporate customers in payment transactions, although the first have already turned away. Since the beginning of July, for example, the discounter Aldi Süd has no longer processed credit card payments through the insolvent payment service provider, but through the provider Payone, as the company explained on Thursday. 

The cooperation with Wirecard Bank has since been limited to business with the Aldi gift card. But this has no consequences for customers.

The connections between Wirecard and Deutsche Bank are complex anyway. Last year, on the initiative of the Wirecard Group, there were even informal merger talks with Deutsche Bank, which, however, broke off quickly as Bloomberg news agency reported first. In addition, the bank temporarily granted company founder Markus Braun a private loan of EUR 150 million secured with Wirecard shares.

In addition, one of the auditors, who was responsible for checking the Wirecard balance sheet at EY in 2017, switched to Deutsche Bank in 2018 as chief accountant.

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