Jupiter Asset Management sold its stake in digital lender Starling Bank.
Jupiter also implemented a new financial activity policy that prohibits the company’s open-end funds from buying shares of private firms.
Back in the summer, Jupiter began a negotiation process with existing Starling investors on the sale of its six percent stake in the mobile bank. The company assumed that the sale would cost Starling about 1.5 billion pounds, which is a discount of a billion pounds compared to its estimate during an internal fundraiser in April.
The buyers are existing shareholders, including the Chrysalis investment fund, which has agreed to purchase shares worth 20 million pounds, which is 15% of the total investment of the fund. Goldman Sachs has previously stated its interest in buying a stake in the digital lender, but it is unknown whether specific actions have been taken in this direction.
In a letter to clients, Jupiter CEO Matt Beasley said that the volatility of the market in recent years has contributed to a change in the attitude of investors to the practice of storing unregistered assets in open funds. The firm decided to ban its open-ended funds from investing in companies not included in the list to protect investors during market sales.
The sale of Starling’s shares came a few weeks after the lender said it expected profits to quadruple this year. These expectations arose against the background of significant growth in the small and medium-sized business market, where the bank opened 520 thousand of accounts. This figure is 8.9% of the market share.
Starling benefits from higher interest rates, as do other UK retail banks. Bank noted in January that pre-tax profit would reach 250 million pounds for 2023 on revenues of about 600 million pounds. The financial institution increased its loan portfolio during the coronavirus pandemic by applying an emergency lending scheme.
As we have reported earlier, Starling Adds Virtual Debit Cards to Pay from Savings Spaces.