After making heavy losses, Orange is seeking a new investor and could even hand over a controlling stake in the business

According to the media, Orange is seeking a new investor to give a much needed boost to to its banking subsidiary Orange Bank.

Orange Bank first launched back in 2017 and was at the time hailed as an important keystone for Orange’s new strategy of diversification and the acquisition of additional revenue streams. 

“[Orange Bank] is going to become a product that French people use every day and it represents a lot of development. Orange Bank is the biggest IT project in France in 2017,” said Orange’s CEO Stéphane Richard in 2017.

This is a far cry from what Richard had to say more recently, when responding to the rumours floating in the media about potential new investors.

“We did not set up this project to become a banker, but to measure our capacity for innovation,” he told Le Canard enchaîné on Tuesday. 

At the time of launch, the company had ambitious goals of acquiring two million customers by 2027 and €500 million in net banking income by 2023. 

Progress, however, has been slow. By the end of 2020, Orange Bank generated a net banking income of just €79 million, despite having 1.2 million customers in France and Spain, according to the company’s account results. This overall customer figure could be largely inflated, however, with Presse-citron revealing back in October that half a million of the Bank’s customers relate to users of a mobile insurance offer for their smartphone, meaning they have not actually opened a bank account.

The bank made an overall loss of €195 million in 2020, having accrued total losses of €643 million since its launch. 

These considerable losses have led Orange to search for a new investor for the banking unit, suggest sources. According to Les Echos, the search for a new investor could ultimately lead to the sale of a controlling stake in the Bank, though an Orange spokesperson has said that the Group intends to maintain a stake.

French media has noted that numerous banking institutions are potentially interested in such a move, citing BNP Paribas, Credit Agricole and Société Générale.

Despite its losses, Orange Bank is still expanding its operations, both geographically and in various customer segments. In January, Orange purchased Anytime, a French neobank focussing primarily on small business and professional customers.

“Anytime’s entry into the Orange Bank family marks a new development opportunity for us in a high-value market segment while establishing strong synergies with Orange Bank and Orange,” said Paul de Leusse, CEO of Orange Bank.

Orange currently hopes to expand banking services to all of its European markets by 2025 as part of its Engage Europe 2025 strategy.


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