N26 co-founder Valentin Stalf is stepping down as joint CEO of the German digital bank amid investor unrest over regulatory failings.
Stalf will move to a role on the N26 supervisory board after a transition period, says Germany's most valuable fintech.
"My move to the Supervisory Board is a forward-looking decision to continue to best utilize my many years of experience and knowledge to strengthen N26," says Stalf.
Maximilian Tayenthal, who founded N26 with Stalf 12 years ago, will remain in his CEO role, says a statement. Between them, the two still hold almost 20% of the company's shares.
Last week, the Financial Times reported that investors were negotiating a deal that would see Stalf leave his role as co-CEO by September 1, with Tayenthal out by December 31.
Backers moved to oust the founders after a BaFin special audit found "weaknesses in the internal control systems, processes and overall organisation," N26 stated in its annual report.
The watchdog has indicated that it will issue a formal warning to two members of N26's management board and put in place a special monitor.
The latest regulatory scrape comes a year after BaFin finally lifted a cap imposed in 2021 on the number of new customers the lender was allowed to onboard.
That cap - along with a €9.2 million fine - was handed down over lax money laundering controls. It was set at 50,000 new customers a month before being increased to 60,000 in 2023, severely limiting growth at Germany's most valuable fintech.