FinTech: Jupiter Fund Management Looking To Offload Its 10% Stake In Profitable Digital Bank Starling

September 1, 2022 | FinTech, News, Takeovers and Buyouts

According to reports, Jupiter is even willing to accept a discount on the sale price.

UK-based Jupiter Fund Management has reportedly asked Citi to find a potential buyer for its 10% holding in Starling Bank, one of the first challenger banks and fintech to become profitable. The stake, said to be worth more than £ 200 million, is held by Jupiter in its UK Mid Cap Fund, as well as other funds.

A report by Sky News said that Jupiter would be even willing to accept a discount on the disposal of the stake, said to have already been offered to “dozens” of prospective investors. (FINANCE MAGNATES)

Jupiter’s open ended UK Mid Cap Fund is rumoured to be likely to face heavy redemptions from investors given the decline in its valuation.

In April, Starling Bank raised £ 130 million at a valuation of £ 2.5 billion. In July, however the digital bank withdrew its application for a banking licence after pursuing it for more than four years, in order to focus on providing Software As a Service (SaaS) to the banking industry.

Starling Bank is profitable

However, the challenger bank posted a maiden profit in its accounts for the financial year ended on March 31, 2022.

Compared to a pre-tax loss of £31.5 million for the 16-month period to 31 March 2021, Starling earned a pre-tax profit of £32.1 million for the financial year ending 31 March 2022.

Revenue for the latest year was £188 million, nearly doubling from the previous year. The bank’s Return on Tangible Equity (ROTE) for 2022 doubled to 17.5% from 8.7% in 2021.

Anne Boden, Founder and Chief Executive of Starling Bank, said: “With our first full year of profitability, we’ve placed ourselves firmly in a category of one. As an innovative digital bank with a sustainable business model and a strong balance sheet we are generating our own capital and we stand apart from both the old banks and other challengers.”

Related Story: UK Digital Bank Starling Clocks First Full Year Of Profitability

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