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British fintech online money transfer firm Wise’s (LON: WISE) stock jumped almost 18% on Tuesday in reaction to a rise in company profits. In a recent statement, the London-based fintech noted that its profit before tax tripled to £146.5 million ($186.5 million). The company also reported that its earnings per share tripled to 11.53 pence.
According to data from MarketWatch, Wise stock has gained 6.58% in the last five days and 16.64% in a month. Since January, WISE rose 11.09%, and a whopping 97.6% in the past year. As of 1:49 pm BST, WISE was trading at £624.40 after climbing nearly 19% on the day. The company’s previous close was £525.40.
Wise has recorded a 34% increase in customer growth, with a total of 10 million as of March 31, 2023. Also, the company’s volume hit £104.5 billion after climbing 37%. For revenue, Wise hit £846.1 million, rising 51% from the £559.9 million the year before. Wise’s total income, buoyed by a spike in customer deposits, jumped 73% year-over-year (YoY), cresting at £964.2 million.
Generally, much of Wise’s profits came from rising interest rates initiated by the Bank of England (BoE). Last week, the BoE increased interest rates for the 13th consecutive time, adding 50 basis points. The Monetary Policy Committee voted 7-2 in favor of the addition, increasing the BoE’s base rate to 5%.
The apex bank has been consistently increasing interest rates to fight rising inflation. In May, the annual consumer price index (CPI) rose 8.7%, higher than the 8.4% expected by economists.
The jump in Wise stock is a silver lining amid the company’s issues. Last year, the Abu Dhabi Global Market’s Financial Services Regulatory Authority (FSRA) fined Wise $360,000 for violating anti-money laundering (AML) laws.
In a statement, the FSRA said Wise Nuqud, a local Wise subsidiary, did not create and operate an AML framework enough to comply with the agency’s requirements. Although the FSRA said it did not find any actual money laundering instances, it identified inadequacy and failures in setting up guideline systems and controls.
UK tax authorities added to Wise’s problems last year after accusing CEO and co-founder Kristo Kaarmann of tax evasion. Her Majesty’s Revenue and Customs fined the CEO £365,651, nearly $495,000 at the time, for filing his personal tax returns late for the 2017/2018 tax year. A company spokesman confirmed that Kaarmann had paid the fine and added required late filing penalties.
In a recent conversation with BBC Radio, Kaarmann seemed to downplay the incident. According to him:
“It has really not much to do with the business that we’re running. It was a personal mistake. I was really late with my taxes a long time ago and I paid the fines.”
Nonetheless, Kaarmann said the Financial Conduct Authority (FCA) is investigating the incident. The outcome of the FCA’s investigation may affect his position as CEO if found guilty.
Tolu is a cryptocurrency and blockchain enthusiast based in Lagos. He likes to demystify crypto stories to the bare basics so that anyone anywhere can understand without too much background knowledge.
When he’s not neck-deep in crypto stories, Tolu enjoys music, loves to sing and is an avid movie lover.
Wise saw its shares dip Monday after management announced that long-serving CFO Matt Briers would leave the company early next year.
Shares of British fintech firm Wise (LON: WISE) slipped 4% on news of CFO Matt Briers’ resignation next year. The London-based company’s stock slide also comes amid reports of CEO Kristo Kaarman’s paternity leave which begins in September. Wise’s shares are changing hands at 590 GBX after management made the announcements.
Briers’ pending departure in 2024 comes after an eight-year tenure with the UK fintech powerhouse. During that period, Wise transformed from a small-time promising business venture to a fintech giant with a listing on the London Stock Exchange. Today, the company also boasts millions of users and a revenue stream that typically exceeds 500 million GBP.
Amid its current shares development, and in a Monday update to investors, Wise revealed an immediate “comprehensive search for a new CFO.” The company’s management also detailed the extent of CEO Kaarman’s planned paternity leave. The Wise chief executive and co-founder will be away between September and December to spend time with his family. However, Wise’s Chief Technology Officer, Harsh Sinha, will assume the CEO role interim.
Briers exits his CFO role at Wise in March of next year to fully recover from a cycling accident he suffered in 2022. By the time he leaves, Kaarman is expected to have since returned from his sabbatical break.
In a statement, the outgoing Wise CFO looked forward to the future and reflected on his time at Wise. Briers stated:
“After almost eight years, it’s time to think about my life after Wise. I’m incredibly proud of what we have achieved in these early chapters at Wise and could not be more excited about what is ahead for the business. Wise is growing fast, with a massive opportunity in front of us, and we’ve bucked the trend by working out how to do this profitably.”
Briers also added that his departure could spark the beginning of ongoing transitional changes in management at Wise for decades to come. As the departing CFO put it, the company “could have many CFOs in its first century,” Furthermore, he stressed, “This is simply me starting the process of handing over the reins to the next one.”
Briers suffered a severe cycling accident in February last year where he went under the wheel of a bus. At the time, while the CFO recovered at home, Wise appointed an interim finance chief in his place. Briers is largely credited with playing a pivotal role in transforming Wise’s fortunes.
The announcement of Briers’ departure is the second of its kind this month, where a CFO position at a leading British fintech platform became vacant. Less than two weeks ago, London-based private neobank Revolut announced the departure of its own CFO, Mikko Salovaara, after just two months on the job.
On May 11th, Revolut said Salovaara’s departure was due to personal reasons.
Tolu is a cryptocurrency and blockchain enthusiast based in Lagos. He likes to demystify crypto stories to the bare basics so that anyone anywhere can understand without too much background knowledge.
When he’s not neck-deep in crypto stories, Tolu enjoys music, loves to sing and is an avid movie lover.