Nir Zuk Invests Heavily in New Digital Bank, Boosting Stake
Translated & summarized from Ice by baba
Digital bank Ash Bank is raising 150 million shekels in a new funding round, with major investor Nir Zuk expected to significantly increase his stake. The bank, which received its license in late 2022, is valued at 500 million shekels and aims to launch soon. The fundraising is a condition set by the Bank of Israel to ensure sufficient capital for its operations and credit offerings.
The story in 5 lines · by baba
- Ash Bank is raising 150 million shekels, with investor Nir Zuk expected to increase his stake.
- The digital bank is valued at 500 million shekels in the new funding round.
- The Bank of Israel set the fundraising amount as a condition for operational approval.
- Ash Bank received its banking license in late 2022 and awaits final launch approval.
- The bank plans to offer checking accounts, credit, and share 50% of interest income with customers.
Ash Bank, a new digital bank, is launching a significant capital raise of 150 million shekels, marking a strategic shift just four months after negotiations for its sale to the credit card company Isracard collapsed. High-tech entrepreneur Nir Zuk, founder of cybersecurity giant Palo Alto Networks, is taking the lead. Zuk, who currently owns 20% of the bank, is expected to inject the majority of the new funds, substantially increasing his stake and diluting other partners. The bank's management is also in intensive discussions with institutional investors, including leading insurance companies, to secure a strategic partner.
The current funding round values Ash Bank at 500 million shekels, the same valuation as a previous understanding with Isracard before that deal was canceled. Unlike the prior agreement, which included an investment in a parallel technology company and was largely an exchange of shares, this round focuses solely on the bank's operations.
The fundraising amount was determined by the Bank of Israel as a condition to ensure sufficient capital for the bank to offer increased credit upon its public launch. Ash Bank, led by CEO Kobi Malkin, received its banking license in late 2022 but awaits final operational approval from the banking supervisor. Upon opening, it plans to offer checking accounts, credit, and financial products to households and small businesses, promising to share 50% of its interest income with customers.
Founding shareholders alongside Zuk include Yuval Aloni and Shir Ra'anan (45%), Alon Shein (10%), Chairman Shmuel Hauser (5%), Clal Insurance (5%), and employees and private investors (15%). The bank hopes that legislative progress on a bill allowing institutional entities to hold stakes in lean banks will facilitate the fundraising, amid growing competition from other digital banking players like One Zero and the recently licensed Revolut Israel.
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