Digital bank Starling said it is considering listing on the London stock exchange as it revealed profits have risen 55 per cent.
Acting boss John Mountain said the lender’s board is holding regular talks with investors about an initial public offering (IPO).
Giving the City a boost, he said London would be Starling’s “natural home” if she decides to launch a float.
It would buck a recent trend that has seen companies choose to list in rival cities like New York or move their listings.
And it comes after Raspberry Pi’s bumper debut on the London Stock Exchange on Tuesday, which has fueled hopes that the tide is starting to turn.
Delays: Plans to bring Starling afloat in 2023 put on hold when founder and former CEO Anne Boden (pictured) resigned
Starling has not set a date for an initial public offering after plans to go public in 2023 were put on hold when founder and former CEO Anne Boden resigned.
Incoming boss Raman Bhatia is expected to provide an update on listing plans after joining the bank later this month.
Mountain said yesterday that the prospect of an IPO “is still widely discussed by the board and shareholders.”
“Several shareholder investment strategies are based on a private-to-public approach,” he said, adding that the bank is “very committed” to a public listing.
He said the lender is “not considering” markets other than London, which is a “natural home for Starling”. “We have always been very much a UK technology company,” Mountain said.
Starling yesterday reported its third year of profitability, as profits rose in the year to March 31 thanks to higher interest rates.
Mountain said Starling was no longer a challenger bank but a “prosperous and established” lender, having reported pre-tax profits of £301.1m.
Higher interest rates in the UK, which are at a 16-year high of 5.25 per cent, have boosted the bank’s net interest margin.
The figure, which measures the difference between what a bank pays in savings and what it generates in loans, increased from 2.72 percent to 4.34 percent.
Revenue rose 50.6 per cent to £682.2 million and total deposits rose 4 per cent to £11 billion in the year to March 31.
Loan impairment provisions rose to £47m, up from £34.5m a year earlier, as a result of a “very modest” rise in arrears.
Starling said it was rolling out its Engine banking software globally and that part of the business could grow more than the retail banking arm.
Last year it signed Salt Bank in Romania and AMP Bank in Australia as its first two Engine clients.
Mr Mountain said: “We have invested heavily in Engine because we are confident that it can one day become as big as the UK bank, if not bigger.”
