New banks

UK challenger bank OakNorth posts profit growth of 95 percent, but growth slows significantly

  • The challenger bank is likely the only profitable one of its peers.
  • But growth is slowing down amid uncertainty.
close

Email a Friend

UK challenger bank OakNorth posts profit growth of 95 percent, but growth slows significantly

OakNorth Bank posted financial results yesterday that revealed pre-tax profits grew 95 percent in 2019 to £65.9 million.

By the numbers: In four years since launching, OakNorth Bank has become the fastest growing company in Europe, according to the Financial Times.

  • OakNorth reported total revenues of £104 million for 2019, up 74 percent year on year
  • The bank has lent over £4 billion to British businesses since its launch in September 2015.
  • Loans and advances to customers grew 58 percent to £2 billion, compared with a more than 100 percent increase in 2018
  • It has attracted deposits from 144,000 savers, up from 28,000 in 2018
  • Over 102,000 of those new savers came via partnerships with other leading fintechs, in addition to 42,000 which came to OakNorth directly.
  • The bank had £2 billion worth of deposits at the end of 2019, up 68 percent year over year
  • The company's claims a Net Promoter Score of 80.5 with its borrowers

"In four years, we have been able to leverage OakNorth’s Platform to build one of the most successful new banks globally, and in doing so, help hundreds of UK businesses who have in turn created thousands of new homes and jobs," said Rishi Khosla, CEO and co-founder of OakNorth.

Carbon footprint: OakNorth has become one of the first banks globally to achieve net carbon zero by offsetting its estimated direct emissions and electricity-generated indirect emissions from its IT infrastructure suppliers.

Context: OakNorth is likely the only major challenger bank to post profits, as financial performance has remained a secondary goal to growth for many competitors.

  • OakNorth's technology platform is a key part of its international growth plan. Unlike other challengers, like Revolut, that acquire local banking licenses as part of their expansion strategy, OakNorth uses its platform to partner with balance sheet lenders internationally.
  • The challenger bank was valued at $2.8 billion in a deal backed by Softbank’s Vision Fund last year. OakNorth raised $390m from Softbank’s fund, with the remaining capital coming from Clermont.

0 comments on “UK challenger bank OakNorth posts profit growth of 95 percent, but growth slows significantly”

New banks

‘Fintechs need to do a better job of talking about how we’re at the forefront of trust and security’: 5 questions with MoneyLion’s CEO Dee Choubey

  • MoneyLion's revenue increased 34% to $93.7 million in Q1 2023 from $70 million in Q1 2022.
  • Tearsheet spoke with MoneyLion's Dee Choubey about the increased revenue for the quarter, the advancing role of AI in banking, and how the banking crisis is affecting fintechs.
Sara Khairi | May 18, 2023
New banks

5 questions with Stash CEO Liza Landsman

  • Stash continues to grow, expanding its B2C offering while it expands into working via a B2B model.
  • We recently caught up with new CEO Liza Landsman about her new role and where the firm is headed.
Zachary Miller | May 04, 2023
New banks

Quick Take: MoneyLion partners with Column Tax – but how does the partnership align with the former’s product suite?

  • In order to provide convenient tax filing experience to its customers, MoneyLion has partnered with Column Tax. So how is this partnership in line with its product suite?
  • MoneyLion shareholders have had a rough ride lately as the firm’s share price tumbled 80% last year and 18% in February this year -- can the company gain ground in the long term on the strength of its underlying businesses?
Sara Khairi | March 16, 2023
New banks

Gamifying financial literacy is tough. Can Greenlight’s Level Up get it right?

  • Financial literacy games can be gimmicky and may fail to find the balance between “game” and “education”.
  • Level Up by Greenlight focuses on gamification in a manner that's sticky, but for the right purposes.
Rabab Ahsan | February 17, 2023
New banks

Rebundling banking services: Are fintechs trying to be more like banks?

  • Why are fintechs that have grown to a certain size continuing to pursue a banking license?
  • Luis Trujillo, CCO at Alviere sheds light on whether acquiring a license guarantees a successful banking business model for fintechs and if it constitutes a threat to banks.
Sara Khairi | January 09, 2023
More Articles