London fintech Clearbank saw revenues triple to £58m last year as financial firms sought its Bank of England-backed deposits amid market turmoil and sharp rate hikes.
Clearbank, which launched in 2015 as the first new clearing bank in 250 years, recorded a 43 per cent surge in net transactions and a 23 per cent jump in fees during 2022.
Clearbank offers fully regulated banking infrastructure and clearing services.
The firm holds all its customer funds at the Bank of England and bosses said that market uncertainty in the past year had sparked a flood of deposits.
A banking crisis and the collapse of Silicon Valley Bank in recent weeks have also spurred a 20 per cent jump in the amount of cash it holds for customers as firms fled to safety from smaller lenders, chief Charles McManus told City A.M.
“I think for the foreseeable future for the next few months, [deposits] will remain higher […] due to the uncertainty in financial markets,” McManus said. “And we’re not we’re not through with that yet. Inflation may be higher for longer and interest rates might have to go even higher.”
The uptick in revenues last year saw Clearbank touch monthly profit for the first time which bosses expect to continue into 2023.
Finance chief Mark Fairless said Clearbank’s policy of holding its balances “securely at the Bank of England remains a core part of our client proposition.”
Clearing banking remains a relatively unsaturated area of the market in the UK and has not recorded the same level of fintech entry as elsewhere in banking.
The Bank of London became only the second such firm to launch in the UK in 2020. It was among a host of bidders vying to buy Silicon Valley Bank’s UK arm before it was snapped up by HSBC.