In a notable development in the European fintech scene, ABN AMRO, a prominent Dutch bank, has announced the acquisition of BUX, a Netherlands-based neobroker that had once rivaled Trade Republic and Scalable Capital. The move brings approximately 500,000 customers of BUX under the umbrella of ABN AMRO, marking a significant shift in the dynamics of the digital investment space.
The acquisition, while anticipated by industry observers, underscores ABN AMRO’s commitment to expanding its presence in the retail customer investment sector and enhancing its digital offerings. It is worth noting that ABN AMRO Ventures, the bank’s startup investment arm, had been an early supporter of BUX, aligning with the broader trend of traditional financial institutions investing in innovative fintech startups.
BUX operates not only in its home country, the Netherlands, but also in Germany, Austria, France, Spain, Italy, Ireland, and Belgium. The purchase price remains undisclosed as of now, pending regulatory approvals from competition authorities.
This strategic move is expected to solidify ABN AMRO’s market leadership in the Netherlands, where the combination of the bank and BUX is poised to create a formidable presence. The acquisition is framed as a growth investment for BUX, enabling ambitious long-term scaling and innovation, bolstered by the extensive resources and infrastructure of ABN AMRO.
Interestingly, the acquisition does not include BUX’s cryptocurrency activities. In contrast to other banks that are increasingly entering the cryptocurrency space amid the anticipated excitement of the crypto year 2024, ABN AMRO has chosen to refrain from such ventures for the time being. BUX introduced its cryptocurrency offerings in 2019, and the fate of these services post-acquisition remains uncertain.
Notably, BUX has not raised as much capital as some of its neobroker counterparts, such as Trade Republic or Bitpanda, both of which have introduced similar investment offerings, including fractional shares, ETFs, and cryptocurrencies. In 2021, Prosus and the Chinese company Tencent led a funding round for BUX, securing $80 million (67 million euros). In 2022, BUX reported a loss of 16 million euros despite generating revenue of 2.52 million euros.
ABN AMRO reassures stakeholders that the transaction is expected to have only a “minor impact on the CET1 capital ratio,” emphasizing its strategic nature in reinforcing the bank’s position, both domestically and internationally, through the innovative capabilities of BUX. As the acquisition awaits regulatory approval, the financial landscape in Europe continues to evolve, showcasing the dynamic interplay between traditional banking institutions and emerging fintech disruptors.
