Issue link: https://maltatoday.uberflip.com/i/1215405
27.02.2020 2 NEWS REVOLUT, the global financial plat- form with over 10 million customers worldwide, has this week raised an ad- ditional $500 million in Series D fund- ing, taking the total amount raised by the company to $836 million. e new funding round was led by US-based growth capital firm TCV, with a number of existing investors also participating. e latest funding round values the business at $5.5 billion, mak- ing Revolut one of the highest valued fintech companies in the world. e new capital was secured on the back of high customer demand and engagement and a strong financial per- formance last year. In 2019, Revolut increased customer growth by 169%, the number of daily active customers by 380%, and saw financial revenues in 2018 grow by 354%. e new capital will be focused on the customer experience and used to strengthen Revolut's core retail and business offering in existing markets, with a particular focus on product de- velopment that will help accelerate daily usage of accounts. Future plans include lending services for retail and business customers, ex- tending high interest savings accounts beyond the UK, further improving cus- tomer service and rolling out banking operations across Europe. Revolut will also focus on further de- veloping its Premium and Metal sub- scription accounts, which have proven to be a successful revenue stream for the business, growing by 154% last year. Revolut's Premium and Metal accounts include a variety of benefits for custom- ers, such as unlimited foreign exchange, airport lounge access, commission-free stock trading and travel insurance. Revolut will continue to invest in ex- panding its workforce across multiple locations. e company now employs over 2,000 people, and last year made a number of senior appointments across the business in order to scale up its gov- ernance. Last year, Revolut appointed Martin Gilbert, the former Co-Chief Executive of Standard Life Aberdeen, as Chair- man of the Board. Caroline Britton, a former Audit Partner at Deloitte, and Bruce Wallace, the former Chief Op- erations Officer at Silicon Valley Bank, were both appointed as Non-Executive Directors. Commenting on the new investment, Nik Storonsky, Founder & CEO at Rev- olut said: "We're on a mission to build a global financial platform - a single app where our customers can manage all of their daily finances, and this investment demonstrates investor confidence in our business model. Going forward, our focus is on rolling-out banking opera- tions in Europe, increasing the number of people who use Revolut as their daily account, and striving towards profita- bility. TCV has a long history of backing founders who are changing their indus- tries on a global scale, so we are excited to partner with them as we prepare for the next stage of our journey." John Doran, General Partner at TCV said: "We are delighted to partner with Nik, Vlad and the entire Revolut team. Using a modern technology stack and with a relentless focus on delighting customers, Revolut has built a truly ex- ceptional customer experience that is exceeding anything that existing banks can offer. We look forward to supporting the team on their journey to build Revolut into one of the biggest financial services companies in the world." Revolut raises $500 million in Series D funding MASSIMO COSTA ITALIAN health authorities have iden- tified over 300 cases of coronavirus (COVID-19) over the past few days, mostly in Northern Italy. Outside of Asia, it appears that Italy has the highest number of known cases. is has led Italian authorities to imple- ment a series of extraordinary measures in various regions in the north of the country to limit the spread of the virus. Schools, public gatherings, most public services and offices and several events have been suspended for a week, with some smaller cities having been put in quarantine. A number of private firms have also encouraged their employees to work from home. Italy registered a negative GDP growth of 0.3% in the last quarter of 2019. And concerns are increasing that the meas- ures imposed due to the spread of the coronavirus, together with the negative effect on consumption because of pub- lic fears – and compounded by the cur- rent global slowdown – could lead GDP to slump again in Q4 2020. Two consecutive quarters of negative growth would place Italy in a technical recession – which would be the fourth the country would have experienced since 2008. In a commentary on the situation re- lease on Wednesday, global credit rat- ing agency DBRS Morningstar said that, if the drop in GDP is limited to a temporary demand shock in line with its baseline assumption of the virus hav- ing a modest one to two quarter impact, this would unlikely have lasting impli- cations for Italy's economy. Italy's DBRS credit rating, the agency said, would remain at BBB with a stable trend. However, DBRS said that the unpre- dictable nature of global transmission patterns appears to suggest at least some risk of a deeper and longer-lasting demand shock. "For Italy, a prolonged and severe eco- nomic recession leading to a materially higher trend for the public debt-to- GDP ratio could negatively impact the sovereign rating," DBRS said. Balancing act between reducing transmission and avoiding further economic damage DBRS said that the already adverse im- pact of weaker foreign demand is now accompanied by the risk of prolonged and widespread stoppages in Italian economic activity. Italy is highly ex- posed to the external environment due to its strong integration in European manufacturing chains, and it will now likely face lower tourism and economic activity due to the coronavirus. Faced by a rise in the number of new infections, Italian authorities have to deal with the difficult task of taking the right measure to reduce transmission while avoiding a situation where public fears are elevated, which would further dampen growth, the agency said. e 0.3% contraction in quar- ter-on-quarter real GDP growth in Q4 2019 constituted the country's worst performance since the first quarter of 2013. A negative carryover of 0.2% does not bode well for growth in 2020 if exports, tourism and economic activity are also to materially suffer an impact from the virus, DBRS said. is will likely also depend on the magnitude of the Italian's government's response to minimise the contagion, it said. "Against this background, although it is too early to estimate the full impact, DBRS Morningstar views the [Ital- ian] government's projection included in the 2020 Draft Budgetary Plan of a GDP growth rate of 0.6% year-on-year in 2020 as very ambitious," the agency highlighted. "According to the Bank of Italy's gov- ernor, the impact of the virus on Italy might go beyond 0.2% of GDP." Italy is the second-most important manufacturing economy in Europe in terms of value added, with its perfor- mance being highly dependent on for- eign demand. Moreover, tourism is also a very im- portant part of its economy, accounting for 5% of GDP. e bulk of the new coronavirus cas- es have been registered in the regions of Lombardy and Veneto, hitting at the heart of the country's economic engine. In light of the economic importance of this region, extending restrictive meas- ures might have an outsized impact on the economy, DBRS said. Fears of Italian recession grow as coronavirus cases rise