Celebrating London’s financial and business community and its most successful individuals and firms
Bank of the Year
A decade after the financial crisis, it seems that the narrative is finally moving on for London’s banking sector. Banks have almost put their legacy issues and billion-pound fines to bed, and thoughts are turning to the future. From the world’s biggest lender to the smaller digital challengers, this year’s nominations all have one thing in common – innovation.
It has been a busy year for Arbuthnot which has strengthened its enviable position in the UK corporate banking market. The 186-year-old banking institution has raised new capital, grown its existing businesses and pushed on with plans to diversify. Secure Trust Bank has grown substantially during Arbuthnot’s majority ownership, and its subsequent sell-down in the firm has freed up further capital for the group to accelerate the growth of Arbuthnot Latham. Net assets per share have risen almost fivefold in the last eight years, demonstrating the exceptional performance of this historic City business.
After officially achieving unicorn status (a startup valued at more than $1bn) towards the end of last year, the tech-friendly bank achieved a whopping £2bn valuation this summer thanks to new funding led by a prominent US investor. Monzo’s popularity across the pond was enough to convince the bank to launch stateside a month earlier, while on this side of the Atlantic it has kept innovating with a new short-term loans service. With two City A.M. Awards already under its belt Monzo continues to cement its position as the UK’s most exciting challenger bank, boasting earlier in 2019 that it serves more than 2m customers with thousands signing up every day.
UK fintech giant Oaknorth started 2019 with a bang, attracting a $440m funding round spearheaded by Japanese mega-investor SoftBank. The funding valued Oaknorth at nearly $3bn, confirming its status as Britain’s most valuable financial technology company. Later in the year SoftBank’s confidence in Oaknorth was justified when the business-lender signed a landmark deal to provide its software and analysis to Dutch lender NIBC Bank, the first agreement of its kind. The bank “for entrepreneurs, by entrepreneurs” has also entered the mortgage market for high net worth individuals and remains one of the few British challenger banks – let alone unicorns – to be profitable.
Arguably the year’s most dramatic activist shareholder defeat came in May when the indefatigable Edward Bramson lost his fight for a place on Barclays’ board, after management successfully convinced investors to back their vision for the business. Bramson’s determination to downgrade Barclays’ investment bank was hit by consistently better-than-expected results despite the struggles of rival lenders, leaving boss Jes Staley determined to show that Europe can still be home to a successful investment banking giant. Bank stocks remain unpopular in the City yet Barclays could be a shrewd buy according to several analysts who expect return on tangible equity to reach 10 per cent next year and net earnings already hitting the billion mark per quarter.
While European banking giants have come under immense pressure in 2019, Credit Suisse is more than holding its own thanks to the bold restructuring imposed by chief executive Tidjane Thiam. The former Prudential boss was a controversial hire back in 2015 having never worked at a bank. However, the visionary CEO embarked on a quick and ruthless set of targeted cuts that is now paying dividends. Net profits nearly touched the 1bn Swiss francs mark according to second-quarter numbers, with the Swiss megalith on course to record double-digit return on tangible equity, compared to just 5.5 per cent rote last year. In a year during which the stock of many of the continent’s banks has dropped, Credit Suisse is up six per cent – no mean feat.
- 2018: Monzo
- 2017: Oaknorth
- 2016: Metro Bank
- 2015: Lloyds
- 2014: Handelsbanken
- 2013: Metro Bank
- 2012: Rothschild
- 2011: Lloyds
- 2010: First Direct
This category began as “Retail Bank of the Year” before changing to “Bank of the Year” from 2013 onwards.