Starling Bank buys £500m mortgage book

By Daniel Lanyon on Tuesday 14 June 2022

Alternative LendingDigital Banking

The neobank has reportedly purchased loans from Masthaven.

Starling Bank buys £500m mortgage book
Image source: Starling Bank

Starling Bank has been increasingly active in its acquisition strategy in recent years with the takeover of Fleet Mortgages in July last year and a bolder attempt to rival Barclays in the purchase of a £1bn book of mortgages from Kensington Mortgages in November.

Its latest foray into M&A is a £500m acquisition of another mortgage book this time from specialist lender Masthaven, according to a Financial Times report.

Both companies are staying silent on the deal but Starling has been vocal about its plans to buy up rivals in a bid to grow its balance sheet.

It raised £130.5m from its existing investors such as Fidelity Management and Research Company, RPMI Railpen, Qatar Investment Authority and Goldman Sachs to build "war chest" for acquisitions in April despite now running at a profit.

The challenger bank has also previously said that acquisitions were “part of a wider plan to expand lending”.

As one of the biggest lenders during the pandemic through the Bounce Back Loan scheme, a government-guaranteed effort to help cash strapped SMEs, it has quickly built up its loan book. 

However, the bank clearly wants to expand and diversify its lending book and appears to be focusing squarely on mortgages.

Masthaven offers flexible and fixed term savings accounts, bridging loans, development finance and mortgages since 2004. Launched as a retail Bank in 2016,  it was known previously as Masthaven Finance. 

Starling Bank declined to comment for this story.

Sign up for our newsletters


Your daily 7am download of all things alternative finance and fintech.

Fintech and alternative finance headlines with an exclusive Editor's Note each week. Delivered Monday at midday.

AltFi's new weekly US newsletter breaking down the ins and outs of America's burgeoning fintech sector. Delivered Monday 9am EST/ 6am PST.

Companies in this Article:

Barclays
Goldman Sachs
Starling Bank

More like this:

Exclusive: Tide scoops up Funding Options in its first acquisition

Editor's Pick

29 November 2022
Oliver Smith

The AltFi Awards 2022: Here are the winners!

Editor's Pick

2 December 2022
Oliver Smith

Zilch poised to axe 10 per cent of workforce

28 November 2022
John Reynolds