Exclusive: Tandem turns over a new leaf with first full-year operating profit

Challenger Tandem Bank will later today report its first full-year operating profit for 2022, AltFi can exclusively reveal, making a turnaround for the business after a tumultuous few years.

Tandem saw its deposits rise from £771m to £1.75bn and lending rose by 175 per cent to £1.2bn during the calendar year 2022, boosted by its new second-charge mortgages and growing green home improvement lending.

Together this helped Tandem generate over £71m worth of income, resulting in a £4.5m underlying operating profit for the very first time since the business was founded in 2016.

The result is a boost for CEO Alex Mollart, who joined Tandem after its January 2022 acquisition of Oplo, took over from Susie Aliker at the end of 2022 and is continuing her strategy of transforming Tandem into a “greener bank”.

While the bank will still report a statutory loss of £12.4m, the indication is that Tandem’s profitability will continue to grow in 2023.

“2022 was a transformational year for Tandem, against the backdrop of a difficult macro-environment,” said Mollart.

“Our shift to become a greener bank has given us a single purpose to get behind, aligning all of our efforts to ensure we support the UK’s transition to a carbon neutral economy. This has helped us achieve an underlying operating profit for the first time and, importantly, provides a path to delivering ongoing and sustainable profitability.”

According to Mollart some 68 per cent of Tandem’s lending is now green, with £250m of new green lending originated in 2022 leading to a current total of over £500m.

The CEO says Tandem has “already seen success across early 2023” and continues to grow “a profitable and sustainable business”.

In January 2023 Mollart led Tandem Bank to acquire money-sharing app Loop Money, financial details of the acquisition were not revealed in these results.