On Friday Founder and CEO Anne Boden announced that Starling Bank is profitable.
In Brief:
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The challenger bank broke even in October and expects to be “monthly profitable from here onwards on an operating profit basis”.
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On an annualised basis profits stand at $10mn.
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The bank currently has nearly 1.8mn accounts, £4bn deposits and $1.5bn of lending.
What does this mean?
Starling has said it was on course to break even for some time, but in reality a surge in lending volumes brought about by Covid-19 and the government’s support loans like CBILS have brought this about more quickly than anyone could have imagined. Importantly, while operating costs have increased by 30% this year, the digital bank’s fixed costs have remained the same – unaffected by a rise in customer numbers.
