When Metro Bank launched in 2010 it was a shock. Not just to the eye, with its bold, bright colours, but to the high street, its competitors – and the regulator.
It was the first time a new bank had been given a licence in more than 100 years and the authorities were not prepared.
Chairman and co-founder Vernon Hill even said it was so hard to set up the bank that he wouldn’t do it again but a new regime came in a year ago, deliberately aimed at making it easier to set up a bank.
Banks will still have to find high quality management and IT systems, but they do not have to find all the capital up front before they are given approval.
And the regulator has dedicated teams working on new licences – around 20 are currently in the pipeline. New banks include private bank Hampden, a private bank, and Paragon Bank, which will target consumer and SME loans.
Now Metro co-founder Anthony Thomson plans to launch Atom, an online-only bank.
He has applied for a licence and expects to receive it in the next six months, allowing him to launch next year.
“Back in 2008 it was a very different world, it was very hard to get authorised,” Thomson told City A.M.
“Since then there has been a sea change in the attitude of the regulator. There is a real desire to see more new banks, more competition, more customer choice.”
“When we started applying for Metro’s licence in 2008 there were heavy regulatory headwinds. Now there are quite strong tailwinds.”
Atom has hired First Direct’s chief Mark Mullen to establish the lender with him.