Coinshares Backed FlowBank Declared Bankrupt Following FINMA Decision
Coinshares-backed FlowBank has been declared bankrupt by the Swiss Financial Market Supervisory Authority (FINMA).
In an announcement, FINMA said it is opening bankruptcy proceedings against FlowBank as the bank no longer has the minimum capital required for its business operations.
“There are also fears that the bank is over-indebted. The bankruptcy proceedings aim to protect depositors. According to current calculations, the privileged deposits can be repaid in full out of the bank’s available funds,” said FINMA.
In 2022, CoinShares announced it had acquired an additional 20.8% stake in FlowBank. The acquisition made by Coinshares was priced at CHF 24,740,000 at the time.
In 2021, Coinshares had a 9.02% stake in FlowBank, taking the overall holding to 29.3%, with voting rights equal to 32.06%.
FlowBank was launched in 2020 and founded by CharlesHenri Sabet. The bank shared a statement on its website stating it had lost its FINMA license.
“Commercial activities of the bank stopped at the opening of the bankruptcy. The bank is no longer authorised to carry out banking transactions or to act as a securities dealer.
In this regard, all payments, purchases and sales of securities can no longer be made. The Bank and its governing bodies are strictly prohibited from carrying out any legal act without the approval of the Liquidators,” said FlowBank.
FINMA said it first took enforcement action against FlowBank back in October 2021 when it identified serious breaches of supervisory law, specifically concerning capital requirements.
In October 2022 FINMA said it had ordered wide-ranging measures to restore compliance with the law and appointed an independent auditor to monitor their implementation.
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