N26 is bringing in a former Bundesbank executive board member to lead its supervisory board, with current chair Marcus Mosen becoming co-CEO following the recent exit of founder Valentin Stalf.
Former central banker Andreas Dombret will be nominated as chair by the founders and several investors, N26 tells the Financial Times.
Stalf stepped down as joint CEO of the German digital bank last week and will take up a position on the supervisory board, with co-founder Maximilian Tayenthal staying in place as joint CEO alongside Mosen.
The leadership shuffle is designed to put an end to months of friction between investors and the co-founders, who between them hold about 20% of N26's shares.
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.