In London Starling bank announced its first acquisition by purchasing 7-year-old Fleet Mortgages in cash and stock for £ 50 million, or about $ 69,114,700.
Bank Monday (July 26) announcement comes on the heels of the recent report that UK-based FinTech saw revenue jump nearly 600 percent in the first quarter of the year. Revenue skyrocketed to £ 97.6 million for the period ended March 31, up from £ 14 million for the period ended November 30, 2019. During this announcement, Starling stated that it is adding a new account every 34 seconds with 2.3 million. open accounts as of the end of June.
With the acquisition, Starling Bank hopes to expand into the mortgage sector as part of a larger plan to expand lending through a combination of strategic agreements, organic lending and targeted mergers and acquisitions, the bank said in a statement.
Fleet Mortgages, based in Hampshire, provides mortgage loans to homeowners who plan to lease properties to tenants. To date, the lender has disbursed £ 2.3 billion in mortgages without any credit losses. With the acquisition, Starling will become the sole sponsor of future projects. As reported Previously, Starling’s deposit base grew by about 500 percent to £ 5.8 billion, up from £ 1 billion in 2019. Starling’s deposit base will be used to help Fleet Mortgages expand its lending operations.
According to the announcement, the day-to-day activities of the mortgage lender will remain unchanged.
“Fleet’s existing management team will remain in place and Fleet will continue to operate as a separate company while maintaining the original name and brand,” said Starling Bank CEO Anne Boden. “We buy Fleet because he is very good at what he does, not because we want to change him.”
Fleet Mortgages CEO Bob Young said the deal would “bring significant benefits” to the firm and its partners. “This is a natural advance for our lending business as both Starling and Fleet share very similar cultural backgrounds,” he said in an announcement.