Jupiter Fund Management to Sell Starling Bank's 10% Stake at Discount

According to Sky News, Jupiter Fund Management is looking to sell its 10% stake in Starling Bank at a discount. The fund has asked Citi to look for a potential buyer.

Jupiter Fund Management holds shares of Starling Bank in its U.K. Mid Cap Fund and other funds. According to Citi, the value of the shares is more than £200M. It is also important to note that this sale does not include the shares held by the London-based investment trust managed by Jupiter's fund managers, Richard Watts and Nick Williamson.

Starling Turned Profitable

Challenger Bank Starling reported a profit of £32M for the financial year ended 31^st March 2022 compared to a loss of £31.5M on 31^st March 2021. Starling saw its revenue rise by 93% to £188M.

In addition, the bank saw its lending and deposit rates climb by 45% and 55%. "In the three months following its latest accounts, Starling has continued to grow at pace and in June 2022 reports an annualized revenue run rate of £331.2m driven by year-on-year lending growth of 72% to £4 billion."

Anne Boden, the 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."

Valuation Rise

Starling Bank raised £130M in April 2022 at a valuation of £2.5B. The digital bank would use the proceeds for acquisitions in the lending sector.

The U.K.-based challenger bank withdrew its Irish Bank application after waiting for four years in July 2022 to focus on SaaS for the banking industry. Anne Boden founded Starling Bank in 2014.