Starling Chief Executive Won't Budge on IPO Pledge -- Financial News
01 Dicembre 2020 - 2:35PM
Dow Jones News
By Emily Nicolle and Ryan Weeks
Of Financial News
Starling Bank chief executive Anne Boden has been steadfast in
her resolve never to put the fintech firm up for sale, as she
continues to angle toward an eventual IPO for the bank.
Reports emerged over the weekend that traditional banking
stalwarts JPMorgan Chase & Co. and Lloyds Banking Group PLC
have "expressed interest" in acquiring Starling, which a
spokesperson for the startup quickly dismissed.
Exactly what these "expressions of interest" amount to is
unclear from the reports in question, but Ms. Boden poured more
cold water on the claims while speaking with Financial News at a
conference Monday.
The Starling founder reiterated that she had no interest in
taking up any past, present or future offers.
"Big banks taking interest in Starling is not new," she said.
"I've always said that I didn't do this to sell to a big bank, and
nothing's changed. We still have our sights on an IPO."
Ms. Boden also said this wasn't the first time she'd been
approached by a U.S. bank about signing a deal, with the rumors
having suggested JPMorgan was interested in acquiring Starling as
part of plans to set up a consumer bank in the U.K.
Lloyds, meanwhile, was reported by the Times to be after
Starling's technology. Ms. Boden believes this to be the young
bank's main appeal for traditional lenders considering a bid for
its business, particularly now that Starling has reported its first
profitable month since it gained a bank license in 2016.
"People are looking at Starling and thinking, you know, wow,
they built their own technology. They took a really, really
difficult route. They decided to get a banking license, pursue the
right customer base, to build the right technology, and now it's
paying off. I'm very excited about that."
While Lloyds didn't respond to a request for comment on the
report, the person in charge of transforming its retail efforts
Stephen Noakes said the lender has set aside roughly 3 billion
pounds ($4 billion) for investing in the lender's strategy. A
spokesperson for JPMorgan declined to comment.
Ms. Boden has always positioned Starling as a rival to the banks
on the high street, despite constant comparisons to its digital
peers Monzo and Revolut. But in recent months, that rhetoric has
changed in favor of emphasizing Starling's appeal as a technology
company--perhaps in an effort to boost the bank's price tag as it
attempts to secure $200 million from investors.
So what part of the FTSE index might Starling fall under if it
goes public? Technology with the likes of Micro Focus international
PLC and Softcat PLC, or finance alongside its reported suitors?
"I think in future, all banks will end up being considered far
more as a technology stock," Ms. Boden said. "I think that banks
are not glamorous at the moment. I think investors look at banks
and think they're very, very hard work. Technology has all the
glamour at present."
"But I'm a realist. The only way you can make money and actually
have a sustainable business is if you're a bank, and you have the
best technology in the world. And that is what we set out to do,
and that's what we're doing."
However, don't expect anything concrete on an IPO to appear from
Starling any time soon. Ms. Boden wouldn't be drawn on a potential
timeframe for a listing, nor how the bank's (undisclosed) private
valuation might be altered by becoming profitable.
"We don't need to raise [to cover] our operating costs now. If
we did have to raise--and I'm not saying that we're raising--it
would be to grow our balance sheet and our European operations.
Once you're profitable, you know, hopefully our profits will cover
all our costs and we don't need to raise further just to keep
going, which gives us a huge amount of independence."
Website: www.fnlondon.com
(END) Dow Jones Newswires
December 01, 2020 08:20 ET (13:20 GMT)
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