N26, a Berlin-based neobank which operates in 25 countries and boasts more than 7 million customers (including 500,000 U.S. customers) is phasing out its operations in the U.S. The company, which is reportedly worth $9B, first launched to U.S. consumers in 2019, partnering with Axos Bank.

Why should we care?
A pullback from the U.S. is a strategic shift for N26, which last February said it was in the process of growing its U.S. employee base by 75%. The company confirmed the planned shutdown of its U.S. operations this week. “We are sharpening our strategic focus on our core business in Europe for the time being,” Chief Growth Officer Alexander Weber said in a statement. Analysts say the company likely came up against a barrage of regulatory complexity in the U.S. In recent months, it was also reportedly shopping for a new U.S. partner bank, further complicating its U.S. plans. The company’s regulatory challenges in Germany may have also pushed it to focus on Europe: In September, the company was fined $5M by German regulator BaFin for “delayed reports of suspicious activity in 2019 and 2020 in the area of anti-money laundering.”