Atom Bank, a UK retail bank built for smartphones and tablets with no physical branches, reported a £36 million operating loss for the fiscal year ending in March 2021, down from the previous years £46 million in losses, according to FinExtra.
Despite continued loss making, the first digital-only challenger bank to be granted a full UK regulatory license reported its first monthly operating profit in June 2021 amid strong growth during the COVID-19 pandemic.
“While we continue to be loss making, the dynamics of the business have been transformed and we have developed strong momentum towards reaching breakeven on a monthly run rate during 2022,” Atom CEO Mark Mullen said.
Mullen says the bank expects to deliver month-on-month profit later in 2021 and plans for long-term earnings ahead of a potential future listing in 2022 or 2023. The bank grew due to COVID-related lending, up £662 million from £240 million last year.
Mullen told Financial News that reaching profitability is a matter of timing, but it would be unwise for Atom to go public without being profitable month by month.
Atom Bank’s valuation has declined about 40% from the £530m valuation it received in 2019, but covered losses its £36 million yearly loss with a recent £40 million venture funding round in April, according to TodayUKNews.
In other recent fintech news, B2B e-commerce company Balance raised a $25 million Series A led by Ribbit Capital. BBVA’s dynamic security code card Aqua is also entering Latin America following a million users adopting the card in Spain and Mexico.