Atom Bank raises £75 million ahead of planned IPO

Atom said it will use the latest fundraise from investors to grow deposits by a further £2 billion in financial year 2023

U.K. FinTech Atom Bank announced Wednesday that it has raised £75 million for a valuation of £435 million, as its plans for an initial public offering (IPO) grow closer to reality.

Atom Bank said it doesn’t know whether it will IPO in the U.K. or what exchange it’ll be on. This round is likely to be the final one it does before it goes public, which will likely happen next year.

The round was led by BBVA and Toscafund, the digital bank’s two biggest shareholders, and received funding from Infinity Investment Partners.

The fundraise follows a £40 million raise last April, bringing the digital lender’s total to more than £115 million in the last 12 months.

Atom said it will use the latest fundraise from investors to grow deposits by a further £2 billion in financial year 2023.

Atom Bank provides savings accounts, mortgages and loans for smaller companies. Launched in 2016, it has no physical branches, but users can access it from a smartphone or tablet.

Our investors are now backing our continued growth, Atom Bank CEO Mark Mullen said in the announcement. This capital will allow Atom to build on the progress we have made, and to keep offering real competition for people who want to own their own home, grow their own businesses and — at a time of rapidly rising costs — save for the future. It is also a fundamental next step on our journey toward IPO.

The company said its focus on lending has seen both mortgage and business loans grow by 30% in the last nine months.

In 2021 Atom passed £3 billion of mortgage completions, with applications for its digital loans peaking at £315 million in the third quarter. Its lending to small businesses also surpassed £1 billion during 2021.