Crypto-friendly bank Erebor in talks for $1.5 billion fundraise at $9.5 billion valuation: FT

Total deposits grew from $1.1 billion in March to $4.6 billion by July, driven by clients in crypto, AI, and defense.

Crypto-friendly bank Erebor in talks for $1.5 billion fundraise at $9.5 billion valuation: FT

Finance

Crypto-friendly bank Erebor in talks to raise $1.5 billion at $9.5 billion valuation: FT

Total deposits grew from $1.1 billion in March to $4.6 billion by July, driven by clients in crypto, AI and defense.

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Francisco Rodrigues

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Sheldon Reback

2 hrs ago

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Erebor close to completing a $1.5 billion financing round. (Andre Taissin/Unsplash)

Summary

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Erebor Bank is negotiating a $1.5 billion funding round for a total valuation of $9.5 billion, according to the Financial Times.

The capital infusion is designed to meet a mandatory 12% leverage ratio while it expands lending operations, including a $200 million facility for Valar Atomics.

Total deposits grew from $1.1 billion in March to $4.6 billion by July, driven by clients in crypto, AI and defense.

Tech-oriented lender Erebor Bank is in advanced talks to raise about $1.5 billion in a deal that would value the year-old firm at about $9.5 billion, the

Financial Times reported

.

Lux Capital, Human Capital, Valor Equity Partners, Andreessen Horowitz and SV Angel are expected to make large commitments in the fundraising round. Existing investors including 8VC and Haun Ventures are also set to take part, according to the report, which cited people familiar with the matter.

The fundraising comes as Erebor expands its deposit base and starts lending activity. Deposits reached $4.6 billion by the end of July, up

from $1.1 billion

at the end of March, the FT said.

Erebor targets companies working in crypto, artificial intelligence, defense and manufacturing. It also serves payment companies, investment funds and trading firms and its planned services include deposits, credit, stablecoin products, treasury management and payments.

The bank received final U.S. approval to operate in February. Regulators require it to maintain a leverage ratio of at least 12% during its first three years, making the fresh capital important as its balance sheet grows.

The bank’s lending push includes a $200 million credit facility for nuclear start-up Valar Atomics.

Valar said

earlier this month that Erebor led the facility as administrative agent, working with JPMorgan, Crescent Cove and Hercules Capital.

The FT said Erebor raised money earlier this year at a $4.35 billion valuation, meaning the proposed round would nearly double its private-market value in months.

Fundraising

banks

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