UK’s Starling Bank Eyes U.S. Expansion
UK-based digital upstart Starling Bank is in preliminary talks to buy a U.S.-based lender as part of its aggressive growth strategy for North America, a move that represents a major milestone in Starling’s international growth strategy that links its underlying banking technology with legacy financial infrastructure.
Starling is reportedly in its sights a small, East Coast-based American bank with around $2 billion of assets. This would be a direct entry for the mobile-led bank into the highly competitive market for banks in America, and enable it to roll out its own banking platform, Engine, to a new set of customers.
Starling’s Engine—cloud-native, SaaS-based core banking platform—is already commercially available internationally. Starling has commenced recruiting U.S.-based personnel to support Engine and is considering locations like Florida, North Carolina, and New York as its bases in the U.S. The acquisition path, instead of seeking a new U.S. banking license, provides a quicker and possibly less bumpy entry, drawing on the acquired institution’s existing regulatory and operational environment.
Since taking over as CEO by Raman Bhatia, Starling has abandoned the focus on buying European licenses and opted to expand Engine’s presence and fuel overseas revenue by forging strategic partnerships and making acquisitions. The bank has already licensed Engine to Romanian and Australian partners.
If finalized, the U.S. deal would be Starling’s first acquisition outside of the UK and highlight its ambitions to become a global banking tech provider rather than simply a digital bank. The transaction is still at an early stage, though.
