Volt is shutting up shop

[oz_mark]

For anyone affected...voltbank.com.au​

​

IMPORTANT ANNOUNCEMENT TO ACCOUNT HOLDERS​

Volt Bank Limited (Volt) is closing its deposit taking business and intends to return its banking licence.​

Customers need to withdraw their funds from their Volt bank accounts before the 5th of July 2022​

Volt has made the difficult decision to close its deposit taking business and has commenced the process of returning all deposits to its account holders.
Customers need to transfer the balances held in all Volt accounts to a nominated bank account with another financial institution before the 5th of July 2022.
The interest rate on all accounts has been set to zero. All interest has been accrued to your account up to the 29th of June 2022 when the interest rate was changed to zero. This interest will be paid to your Volt account on the 29th of June 2022 except for the Save and Spend accounts which will be paid on the 1st of July 2022.

 

[dk4]

When Xinja collapsed at the beginning of Covid, I was left to wonder how much the government may have paid out as part of the $250k deposit guarantee, and again I wonder if things are being hushed up with Volt now? (So there is no loss of confidence in Australia's banking system.) When a finical business "goes bust", like these banks have, that normally means they don't have the funds available to cover deposits - so the money, to pay out the customers in full (and with interest), must coming from somewhere?

 

[jakeseven7]

Nothing is being hushed up? Where are you reading that from? Its stated they have funds to cover deposits, just not the increased capital requirements.

Anyway, writing was on the wall for these neo banks the second they opened.

 

[jbman]

They increased the limits so you can get your cash out right away.

From Volt:

Withdrawal limits
To help with the transition of funds to your external account quickly, we have increased your daily transfer limit to $250,000.

As soon as I got notification I logged in and did a transfer to Macquarie which happened instantly.

 

[albyd]

I agree it’s hard to set up a new bank without the capital backing. You can only pay market leading interest rates on deposits for so long before you run out of money if not making a return from lending it out.

It’s a tough environment for bank shares right now so not surprised it was hard to attract new investors. Look at the experience for Judo investors they’ve seen their share price halved since listing.

The incumbent banks have the benefit of having been around for a long time.

We’ve had bank busts before with more unpleasant results for depositors - just few in living memory which is testament to how well the system is regulated (I don’t work for a bank or a regulator btw).