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German fintech N26 has appointed a new chief executive, hours after it was hit by fresh sanctions from the country’s financial regulator BaFin.
The digital bank on Monday named Mike Dargan of UBS as its new chief from April, subject to regulatory approval, as the company seeks to resolve a protracted dispute between its founders and investors.
Dargan will succeed N26 co-founder Maximilian Tayenthal and Marcus Mosen, the interim co-chief executive, who was brought in by investors to stabilise the bank in the wake of regulatory action.
His appointment came after BaFin earlier on Monday imposed fresh sanctions on N26, intensifying pressure on the fintech to overhaul its governance and risk controls.
Following a recent review, the regulator ordered N26 to halt new mortgage lending in the Netherlands, imposed additional capital requirements linked to that business, identified deficiencies in its risk management and complaints handling, and appointed a special monitor to oversee remedial measures.
The intervention came after a previous BaFin-appointed monitor left the bank late last year and the regulator lifted a 50,000-a-month cap on new customers that had been imposed over alleged failures in anti-money laundering controls.
The renewed scrutiny had added urgency to negotiations over a new shareholder agreement, which remains unsigned despite months of talks.
Under the terms being negotiated, the two founders — who together own about 20 per cent of the shares — would give up special voting rights that grant them the power to veto significant decisions and would be allowed to nominate only two supervisory board members, rather than the current four.
In exchange, the 25 per cent annual returns guaranteed to new investors who participated in a 2021 fundraising would be reduced.
As part of the deal, Tayenthal is due to leave the management board at the end of 2025. The other co-founder, Valentin Stalf, stepped down as chief executive earlier this year with the intention of joining the supervisory board.
N26 recently appointed three new members to its supervisory board, including former Bundesbank executive Andreas Dombret as chair, replacing Marcus Mosen after he became interim chief executive.
In an interview with German newspaper Börsen-Zeitung, Mosen said he was a temporary “man for the transformation”, brought in by investors to stabilise the bank, address BaFin’s findings and guide a strategic reset.
N26’s new chief executive Dargan is currently group chief operations and technology officer at Swiss lender UBS, where he had been a member of its executive board since 2021. He will leave UBS at the end of the year.
The British executive had a key role in UBS’s integration of Credit Suisse, overseeing the migration of data from Credit Suisse to UBS systems following the latter’s rescue of its domestic rival in 2023.
But his remit had been narrowed as part of an October reshuffle of the Swiss group’s executive board.
N26 said it was working closely with supervisory authorities and the special monitor.
It added that teams across the bank were implementing governance and operational measures to ensure “co-ordinated and timely execution” as part of a broader overhaul of controls, processes and structures.