Amnon Shashua's First Digital Bank raising $120m

Amnon Shashua  credit: Yonatan Hefner

Among the investors are Julius Baer, Tencent, and Japanese financial group SBI.

The First Digital Bank, owned by Prof. Amnon Shashua, is raising $120 million from local and international investors, led by Swiss bank Julius Baer, Chinese technology giant Tencent, and Japanese financial group SBI.

The current fund raising takes place after The First Digital Bank approached many financial institutions in Israel six months ago, seeking funding. Among the firms approached was Amitim, which runs the old pension funds. Amitim did not rule out participation in the fund raising, but decided to wait until it could examine the final models proposed by the bank.

The First Digital Bank was founded and led by Marius Nacht, who brought Shashua in as a partner in August 2018. In May 2020, The First Digital Bank announced "changes in the controlling core". Shashua bought Nacht's holding and became sole controlling shareholder.

Shashua, who injected initial capital into the bank of $65 million, will also participate in the current fund raising round and will remain with a controlling share of over 50%. The bank, headed by CEO Gal Bar Dea and chairperson Shouky Oren, says that the cash raised will be used to further the bank's business plan and to complete the regulatory capital required by the Bank of Israel.

The three lead investors in the current round are joined by US investment fund West Coast Equity Partners, the provident fund of the Hebrew University workers, and Singapore-based fund Far East Ventures. The banks says that it is in advanced talks with additional investors who could join the investment agreement, which may lead to the expansion of the amount invested. The deal is expected to close this January.

In March this year, The First Digital Bank began a running-in period, with the aim of gradually launching activity with the general public in early 2022. The bank's management says that it has over 60,000 people on its waiting list.

Talking to "Globes", Bar Dea said, "This represents an expression of confidence in the Israeli market, in Israeli regulation, and in our technological vision, and also in the fact that the business that we have built will be opened not just in Israel but in other markets as well."

So you now have enough capital to open up for business?

"Yes. The capital raised is earmarked for technological developments. We are meeting our goals and plan to launch the service with a soft launch in the next few weeks. The official launch will be in another few months. The mobility reform makes it possible to switch banks with a click, and I have no doubt that the big bang that happened in the mobile telephony market will come to the banking market as well. There are customers from a variety of different sectors on our waiting list."

Rothschild & Co advised The First Digital Bank n the transaction. Law firm Meitar Liquornik represents the bank, and Herzog Fox & Neeman is advising the investors in the due diligence examination.

Marius Nacht is the former life partner of Anat Agmon, one of the owners of "Globes".

Published by Globes, Israel business news - en.globes.co.il - on December 14, 2021.

© Copyright of Globes Publisher Itonut (1983) Ltd., 2021.

Amnon Shashua  credit: Yonatan Hefner
Amnon Shashua credit: Yonatan Hefner
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