Neobank Starling reports the first profitable year, revenue increased by 93%
Neobank Starling has reported its first full year of profit. Its revenues increased by 93% to 188 million pounds. The company was the first to report a profit for the year among a group of European challenger banks, which includes Monzo, N26 and Revolut.
According to annual financial results released on Thursday, Starling Bank reported its first full year of profitability.
The British startup bank reported a pre-tax profit of 32.1 million pounds for the 12 months to March 31, 2022, compared with a pre-tax loss of 31.5 million pounds for the previous period ended March 31. The result was mainly driven by annual revenue of 188 million pounds, which increased by 93%. Previously, the company was break-even in some months, making a profit of 800,000 pounds in October 2020.
This makes neobank the first among its contemporaries, such as Monzo, Revolut and N26, which makes a profit throughout the financial year.
The bank also reports that it has reduced its dependence on the UK government loan scheme, created to help SMEs survive the pandemic. After the acquisition of neobank, Fleet Mortgages now has mortgages worth more than 1.1 billion pounds on its balance sheet. Nevertheless, SME loans still account for the vast majority of its loans: as of March 31, 2022, more than 2 billion pounds were provided under the state scheme, of which 1.8 billion pounds were guaranteed by the state.
Former British government minister Lord Agnew has previously criticized neobank for using the scheme as a "free marketing event" and not taking its anti-fraud responsibilities seriously enough.
In April, it was reported that neobank had raised 130.5 million pounds with an estimate of 2.5 billion pounds. The funding came from existing investors Fidelity Management and Research Company, RPMI Railpen, Qatar Investment Authority, Goldman Sachs and billionaire Harald McPike.
At the time, the company said that this money would allow it to continue growing and increase the number of acquisitions.
"We make no secret of our ambitions in the field of mergers and acquisitions and expect that targeted acquisitions will play a key role in the coming year," CEO Anne Boden said in a report on the results of the year.
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