- Starling has recorded its third full year of profitability
- Digital bank made £301.1m in pre-tax profits
Starling Bank has recorded its third year of total profitability as it benefited from higher interest rates and customer growth.
The digital bank posted pre-tax profits of £301.1 million in the year ending March 31, 2024, up 54.7 per cent on pre-tax profits of £194.6 million sterling last year.
Its revenue rose to £682.2 million from £452.8 million.
Starling reported net income (the difference between what banks charge borrowers and what they pay savers) of £592.9m, up from £348.9m last year.
Starling Bank has recorded its third full year of profitability
Its net interest margin soared to 4.34 percent from 2.72 percent.
Starling said “higher base rates certainly provided a strong tailwind” as well as growth in its customer base.
The bank’s total customer accounts increased from 3.6 million to 4.2 million and deposits grew to £11 billion from £10.6 billion in 2023.
Starling also attributed its success to its first software-as-a-service sales through its Engine software business.
In May, Starling launched its first bank, Salt Bank, in Romania using Engine software and is halfway to launching a second digital bank in Australia.
These are the first results Starling has published since the departure of founder and former CEO Anne Boden.
The new group CEO, Raman Bhatia, will take charge on June 24, 2024.
John Mountain, acting head of Starling Bank, said: ‘This is our third full year of profitability and demonstrates strong financial performance.
‘It was a watershed year for Starling as we became a global provider of banking software as a service through our subsidiary Engine by Starling.
“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.”
David Sproul, Starling group chairman, said: ‘Starling is now an established part of the UK banking landscape.
‘The percentage of active accounts now stands at almost 80 per cent, while total transactions rose 21 per cent to £174.1 billion over the year.
“We have more customers, they use our services more frequently and we continue to deepen their relationship with us.”
Starling has been listed as a future Initial Public Offering and these results could represent another step for the bank, founded in 2014, in its IPO.