First digital bank Simple to shutter
The digital bank was first acquired by BBVA USA in 2014 for $117m.
One of the first digital banks on the market, Simple is to shut up shop following the acquisition of BBVA’s USA division by US bank PNC.
The takeover of the Spanish bank’s US outfit was agreed in November 2020 and was worth an eye-watering $11.6bn.
In an email sent to customers and seen by AltFi, BBVA USA said it “made the strategic decision to close Simple,” and reassured customers that there would be “no immediate impact to your accounts at Simple.”
Simple’s customers will see their accounts transferred over to BBVA USA, which already houses the accounts, and they will still be protected under the Federal Deposit Insurance Corporation (FDIC) scheme.
BBVA has since released a statement on the closure of its subsidiary, which reads: “We have taken the opportunity of the pending merger with PNC to reassess our goals for BBVA USA, so that we’re focused on the things that make the most sense for the company’s future whether on a standalone basis or a potentially combined basis with PNC.”
“As a result, today we’re accelerating some changes and stopping work on others, including the closing of Simple.”
Simple first opened its app to customers in 2012 and, just like other digital banks, it had no physical branches and was largely accessed via its mobile app.
Hailed as one of the first challenger banks, Simple was founded in the wake of the 2008 financial crisis by former CEO Josh Reich, former CTO Alex Payne and former CFO Shamir Karkal, before being acquired by BBVA USA for $117m in 2014.
Reich continued to lead the digital banking service until 2018 when he decided that, after 10 years at the helm of the fintech, it was time to move on.
There will be no immediate changes to Simple’s customers and those who wish to stay on with BBVA, and then subsequently PNC, will have access to both bank’s full range of services.