Starling Bank’s US Expansion Plans Could Include NY IPO

Declan Ferguson, the bank’s chief financial officer, said in an interview with the Financial Times (FT) Tuesday (July 15) that Starling was mulling an American listing, as it could potentially reach a higher valuation than in its home country.

“We continue to observe what is happening externally with our peers, and also what is happening on the global stage in terms of the U.K. versus U.S. [stock markets],” he said.

Asked if Starling would be better suited on a U.S. exchange, Ferguson said that the company had not formed a “concrete view,” and that the decision on where to list was still “in flux.” He stressed that the company was in no rush to go public.

The FT notes that listing in New York would mark a shift for Starling. Last year, the bank’s former interim CEO John Mountain said the company was “very committed” to an initial public offering (IPO) in London, which he called Starling’s “natural home.”

Ferguson told the FT that while listing in New York might improve Starling’s valuation, the company was focused on expanding its business in the U.S.

Starling had said as much to PYMNTS late last month following a report that the company was considering purchasing a nationally-charted bank in the U.S.

“Having recently established a U.S. presence for Engine by Starling, our software-as-a-service business, we’re exploring a range of expansion options that would enable us to showcase Engine’s capabilities in this major market.”

This was in response to a Bloomberg News report, citing an unnamed source, which said that Starling was looking for an East Coast-based bank with assets of around $2 billion and that is working with outdated digital offerings that could be bolstered by Starling’s technology.

Starling began its expansion into the U.S. earlier in the year when it announced that it would make its technology available in the country and registered a subsidiary in Delaware. 

The company noted at the time that it was building a team and seeking a regional headquarters on the East Coast, and that it sees the chance to provide its cloud-native technology to the 4,000 mid-tier banks, community banks and credit unions in the U.S.

PYMNTS Intelligence research has noted that many credit unions are turning to specialized technological providers to boost innovation efforts in areas like fraud prevention and improved efficiency and member experiences.