N26 head of risk quits in escalating leadership crisis. The third exit of a senior manager in less than 12 months.

N26’s chief risk officer Thomas Grosse resigned due to personal reasons, becoming the third senior executive to depart one of Europe’s highest-valued start-ups in less than 12 months, people familiar with the matter told the Financial Times.

Grosse was one of just two people at N26 with the necessary regulatory clearance to run a bank in Germany and was in charge of governance, compliance and risk. His departure is the third exit of a senior manager after chief operating officer Adrienne Gormley left last April and chief financial officer Jan Kemper departed earlier this year.

The exits raise questions about the group’s internal governance when N26 is already under pressure from regulators over its controls. A former employee of Deutsche Bank and Google, Grosse was the most senior executive in charge of fixing N26’s biggest issue: the improvement of the bank’s anti-money laundering controls demanded by German regulator BaFin.

In 2021, BaFin imposed a crippling growth cap on N26, forcing the bank not to accept more than 50,000 new clients a month — a steep drop-off from the 170,000 clients a month it was accepting on average before the cap. The restriction remains in place despite N26’s initial confidence it would be removed in 2022.

BaFin also dispatched a special representative to oversee improvements to the bank’s anti-money laundering controls and fined N26 €4.25mn for weak money-laundering controls. Co-founder and co-chief executive Valentin Stalf told journalists in October that he was confident “most” of Bafin’s restrictions would be lifted within six to 12 months if not earlier, as the lender was “compliant with the bulk of the regulatory requirements”.

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N26 has 8mn retail customers in Germany and 20 other European countries after pulling out of the US in 2022 and the UK a year earlier. The group reported a net loss of €172.4mn for 2021 on €182.4mn of revenue, saying it would not need additional funding before it broke even.