Key facts
- Chrysalis Investments reduced its Starling Bank stake valuation by 5% to £356m in Q2.
- The markdown contributed to a 2.35p per share decrease in Chrysalis' net asset value.
- Chrysalis sold £6.6m of Klarna stock at $17.73 per share, followed by an $8m sale post-quarter.
- Proceeds from the Klarna sale will be used to pay off £17.8m in company debt.
- Starling recorded a pre-tax profit of £217m in the last year, down from £223m.
Chrysalis Investments has again marked down the valuation of its stake in Starling Bank, reducing it by 5% to £356m in the second quarter. This adjustment contributed to a 2.35p per share decrease in the investment trust's net asset value. Starling, which constitutes over 56% of Chrysalis' portfolio, saw its valuation decline due to a contraction in valuation multiples among high-growth fintech peers, despite traditional bank stocks and the broader peer group rallying.
Starling reported a pre-tax profit of £217m in the last year, a slight decrease from £223m, with revenue slipping due to falling interest rates and increased investment in its software-as-a-service arm. Chrysalis also confirmed it had sold a portion of its Klarna stake, which represents nearly 10% of its portfolio, to raise cash and settle company debt. The trust offloaded £6.6m worth of Klarna stock at approximately $17.73 per share during the quarter, followed by an additional $8m sale after the quarter ended. These proceeds are earmarked for paying off £17.8m in outstanding debt. As of June 30, Chrysalis holds a £57m stake in Klarna, following a significant 54% markdown to £41m at the end of March after Klarna's IPO. Klarna shares have fallen over 55% from their debut price.