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Q1 2020 Update

B-North is unique, modern and differentiated. Driven by a singular purpose - to better serve SME borrowers, and combining cloud-native technology with the trust of face-to-face relationships.

- 17 APR 2020


Our unique proposition

  • UK-wide local decisioning and delivery – Regional Pods (local banks) allow an acute focus on each business and enduring face-to-face relationship
  • Secured Loans (£0.5m-£5.0m), tailored to the borrower – the proximity of front-line bankers and underwriters supports more flexible finance proposal
  • Delivered at pace – providing secured finance up to 10 times faster than the market standard, to truly support scale up and growth
  • Strategically embracing the £20bn p/a broker channel – ground-breaking model will ensure Bank North is the preferred partner for high quality brokers
  • Competitively priced – banking model delivers access to enduring low-cost capital
  • Banking licence imminent – process navigated in record quick time
  • Delivered by an exceptional, well established team with extensive experience of building and scaling banks


  • Impact of Covid-19 being mitigated - B-North is taking a proactive approach based on government guidance.  Being a cloud-based business, B-North has been able to seamlessly transition into the present remote working environment. with negligible impact on productivity. The dislocation of financial markets may impact the timing of equity fundraising, so the business has taken prudent cash management actions to extend runway well into Q4, 2020 to mitigate the potential impact.
  • Banking licence process nearing completion – B-North submitted its licence application in September 2019, having received its invitation from the Regulator in August - a step which over two-thirds of applicants fail to reach. The process continues to progress smoothly and, whilst the Regulator has a complex agenda to navigate in the current climate, we are hoping that the UK Regulator will be minded to approve B-North’s application in the coming weeks (Authorisation With Restriction).
  • Series A equity raise making progress – it is possible that the timing of B-North’s £20m Series A round will be impacted by the Covid-19 financial market dislocation. As noted above, the business has taken swift and prudent action and B-North continues to engage in a positive dialogue with a number of potential investors.
  • Systems development and integration progressing at pace – B-North’s partnership with Mambu and nCino on a seamless integration of their core banking and loan origination systems continues to flourish.


Jonathan Thompson, Chief Executive Officer, commented:

“First and foremost, our thoughts are with everyone that is being affected by Covid-19.

That aside, our banking licence process continues to progress smoothly. 
B-North has the governance, processes and key people in place to commence lending and we aim to play our own part in helping the UK to recover and re-build post C-19.

In these unprecedented times, it is clear to myself and the team that there has never been a greater imperative to bring B-North to market to support UK SMEs”


Overview of progress

We are living in difficult times with Covid-19 impacting every business in the UK. The detail of the potential impact on the business and management’s response is covered below but, in summary, good progress continues to be made with the banking licence authorisation process nearing completion and with the business being readied to commence lending shortly thereafter.

Covid-19 Impact

Management is proactively and closely monitoring the impact of Covid-19. From a day to day operational perspective B-North is taking a sensible approach based on government guidance. The team has been working from home since mid-March and the impact on productivity has been negligible with B-North using market-leading collaboration tools to ensure ongoing teamworking and effective communication.

Financial markets have, however, been significantly dislocated. The team has, therefore, prudently taken appropriate cash management actions to extend its cash runway into Q4, 2020 to mitigate the potential impact of this dislocation on the timing of its planned equity raise. Alongside this, the applicability of the new government funding schemes is being closely evaluated, although the potential benefits are currently assessed as limited.

It is clear that Covid-19 will have serious implications for existing lenders with a legacy loan book and, indeed, several have already announced that they have completely stopped all new lending activity. 

As a result, the team firmly believes that there has never been a greater imperative to bring B-North to market to support UK SMEs. The ability to lend in a risk averse market increases the attractiveness of the market opportunity and the team firmly believes that the need for, and value of, an SME-focused lending bank with no legacy loan book has increased significantly.

Banking licence application well advanced

The progress that we are making with our banking licence application continues to be positive, particularly in view of the complex macro-economic backdrop where the demands on the Regulator have no doubt increased. We submitted our banking licence application in September, a milestone that less than two-thirds of those starting the process achieve. Since then, we have had a series of monthly meetings with the PRA and the FCA to keep them updated on progress in the business.

Importantly, the team believes that it has now responded to all of the regulators’ residual information requests required to complete the authorisation process. Taking into account the progress made to date and the feedback received, the B-North team is hopeful that the regulators will be at a point where they are minded to approve B-North’s banking licence application in the coming weeks.

We would like to acknowledge the engagement we have had with the regulators, who have made the process very transparent and straightforward.


As previously noted, B-North received additional investment of £2.7m through its recent Super-Seed equity raise. This capital will fund the further development of the business through to the point of obtaining its banking licence and will ready the business for early commencement of lending activities. Coupled with the cash management actions noted above, this provides the business with sufficient cash resources well into Q4, 2020.

The process of raising the £20m of capital required to underpin the bank at the point of receiving its licence commenced at the start of this year and is being led by Berenberg Bank. Although it is highly possible that the timing of this fundraise could be impacted by the Covid-19 dislocation of financial markets, B-North continues to engage in a positive dialogue with a number of potential investors. 

IT system build

One of B-North’s key points of differentiation will be its IT platform that will help deliver a fundamentally re-engineered and enhanced SME lending journey.

As previously noted, the development of the Customer Loan Origination system, in partnership with nCino inc., continues to progress well and the productised integration of that platform with Mambu’s Core Banking system is now very well advanced in anticipation of the commencement of early lending activities. Work has also commenced on the build of the deposit-taking platform in partnership with Newcastle Strategic Solutions Limited.

During the last quarter, the business has also made significant progress in identification and selection of FinTech partners to accelerate critical elements of the lending process. 

Further development of the Team

B-North is taking another significant step towards building a fully independent board with the impending appointment of Heather Jackson as an advisor to the Board, prior to her being appointed as a non-executive director in due course. Heather brings a wealth of experience not just in financial services but across other industries as well. Heather is currently a non-executive director of Skipton Building Society, Ikano Bank AB, Lookers Plc and JD Sports Fashion plc.

Early commencement of lending

As previously noted, B-North intends to commence lending activities shortly after receipt of the banking licence. The aim is to fund the initial loan book through a securitised debt facility and B-North is making good progress with a major financial institution in respect of such a facility. 

Financial results

Management continue to exercise tight budgetary control and this is ensuring that the cost of developing the business is lower than the initial forecast. There is no change to previous guidance that the overall build the bank cost is expected to be over 20% lower than original expectations.


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