Revenue growth outstrips increased operating costs
Despite a volatile economic backdrop, digital lender Atom bank has delivered its first ever annual operating profit of £4 million.
After suffering a £2 million loss last year, the UK’s first app-based bank bounced back, with customer numbers almost doubling to 224,000 during the period from 123,000 in 2022, while customer net interest margin remained strong at 2.84% and net interest income increased by 62% to £76 million.
Total operating costs rose to £59 million as the bank continued to invest in its people and capabilities but was hugely outstripped by revenue growth.
Atom passed on the majority of the base rate rises to its savings customers, but chose to not pass on the June base rate increase to its standard variable rate (SVR) mortgage customers.
“It has been an important year for Atom as we’ve grown strongly, kept our costs tight, and delivered our first annual operating profit,” stated Mark Mullen (pictured), chief executive at Atom bank.
“We’ve also passed on more than 70% of the Bank of England’s base rate increases to our savers but only 70% of them to our SVR mortgage borrowers. And we’ve done it while maintaining our five-star Trustpilot and App Store ratings.
Mullen said he was proud that over the course of the year, Atom has shown that banks can provide exceptional customer service and offer customers better value for money.
“We never allow ourselves to forget that ultimately, the customer pays for everything,” he added. “We believe that the lowest cost wins. Lowest cost and highest quality win every time. If that isn’t the new banking paradigm, then it ought to be.”
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