Multitude Fortifies Balance Sheet with €70 Million Perpetual Bond Deal

ZUG, SWITZERLAND – March 11, 2026 – In a significant strategic financial maneuver, European FinTech group Multitude AG has successfully placed €70 million in subordinated perpetual capital notes, signaling strong market confidence and bolstering its capacity for future growth. The issuance, conducted through its wholly owned subsidiary and funding vehicle Multitude Capital Oyj, was met with robust demand from a mix of new and existing institutional investors across Europe and the UK.

Critically, the new capital notes qualify as equity under International Financial Reporting Standards (IFRS), a sophisticated move that strengthens Multitude’s balance sheet without increasing its traditional debt load. The proceeds are earmarked for a proactive refinancing of existing notes and to provide capital for general corporate purposes, underpinning the company’s expansion in the digital lending and online banking sectors.

A Proactive Capital Maneuver

The primary use of the net proceeds will be to finance a tender offer for Multitude’s outstanding €45 million perpetual notes, which were issued in July 2021. This refinancing comes ahead of the notes’ interest step-up date on July 5, 2026, a contractual feature that would have increased the coupon payment. By acting preemptively, Multitude avoids higher future interest costs and demonstrates disciplined financial management.

The new capital notes carry a floating rate coupon of the 3-month EURIBOR plus a margin of 8.90% and were priced at 96.00% of their nominal value, reflecting current market conditions for such instruments. The offering included an exchange option for holders of the existing notes, which saw participants with an aggregate principal of approximately €19.2 million roll their investment into the new issuance, a clear endorsement from the company's existing capital partners.

Bernd Egger, Multitude’s CFO, highlighted the strategic rationale behind the transaction. “This transaction reflects our disciplined capital markets strategy and our commitment to proactively manage our balance sheet,” Egger stated. “By refinancing ahead of the step-up date, we optimise our capital structure while maintaining flexibility to support the Group’s continued growth. The strong investor demand underlines market confidence in Multitude’s strategy and financial performance.”

Decoding the Perpetual Bond

Multitude's choice of a perpetual bond that qualifies as IFRS equity is a key element of this strategy. Perpetual bonds, or 'perps', have no maturity date, meaning the issuer is not obligated to repay the principal. Instead, they provide a steady stream of interest payments. For an instrument to be classified as equity on the balance sheet under IFRS, the issuer must have no contractual obligation to deliver cash, which is a feature of these notes.

This accounting treatment is highly advantageous. It allows Multitude to bolster its equity base, thereby improving crucial financial health indicators like its equity ratio and debt-to-equity ratio. As of the end of the first quarter of 2025, the company's net equity ratio stood at 25.4%. Strengthening this ratio enhances financial stability and provides a more robust foundation for securing future funding and pursuing growth opportunities. For investors, the instrument offers a higher yield in exchange for taking on greater risk, including the subordinated nature of the notes and the lack of a fixed redemption date.

A Vote of Confidence from a Cautious Market

The successful placement comes at a time of increased scrutiny in the global FinTech funding landscape. Following a period of rapid expansion, investors have become more selective, prioritizing companies with proven business models, clear paths to profitability, and resilient balance sheets—a trend some analysts have dubbed 'fintech Darwinism'.

In a powerful endorsement of Multitude's position, Fitch Ratings recently affirmed the company's Long-Term Issuer Default Rating (IDR) at ‘B+’ with a Stable outlook. More notably, the ratings agency upgraded the consolidated Group’s standalone credit profile to ‘BB-’ from ‘B+’ and simultaneously upgraded the Long-Term IDR of its subsidiary, Multitude Bank PLC, to ‘BB-’. This upgrade reflects the group's solid profitability and strengthening capital position.

Fitch assigned the new perpetual notes an expected long-term rating of ‘B-’ with a Recovery Rating of ‘RR6’, indicating poor recovery prospects in a default scenario. This is consistent with the rating of the existing notes and reflects their deeply subordinated position in the capital structure, which is typical for such equity-like instruments.

Fueling a Diversified FinTech Engine

With its balance sheet fortified, Multitude is well-positioned to accelerate its growth strategy across its three distinct business units. The company serves market segments often overlooked by traditional banks through a diversified model:

• Consumer Banking (Ferratum): This unit provides digital consumer loans and has been a cornerstone of the group's operations since its founding in 2005. The fresh capital will help expand its lending portfolio and invest further in AI-driven scoring and underwriting to enhance efficiency.

• SME Banking (CapitalBox): Focused on providing working capital and other financial solutions to small and medium-sized enterprises, CapitalBox is a key growth driver. The funding will enable it to scale its lending activities, particularly in high-performing European markets.

• Wholesale Banking (Multitude Bank): This division serves other FinTechs with secured debt and payment solutions, acting as a growth platform for the broader ecosystem. The enhanced capital base strengthens its ability to support emerging financial technology companies.

Looking ahead, Multitude has set ambitious targets, including a net profit forecast of €30 million for 2026, with expectations of 20% annual growth thereafter. The company plans to list the new capital notes on a regulated market within four months and on the Frankfurt Stock Exchange Open Market within 60 days, ensuring liquidity for its investors and reinforcing its commitment to transparency in the public markets.