Atom bank, the UK’s first app-based bank, has passed £1 billion in commercial mortgage completions.
It marks a significant milestone for the digital lender, who has been a consistent champion of UK SMEs since launch in 2016.
The news comes with Atom bank having last week announced its strongest ever financial results. Operating profit grew to £27m, a 600% increase on last year, with costs up just 4%. The bank saw a significant growth in commercial mortgages, ending the year with balances of more than £600m, an increase of 19% on the previous year.
Support for SMEs
Atom bank has been one of the biggest participants in the Recovery Loan Scheme (RLS), launched in the aftermath of the pandemic. The bank provided funding of more than £235 million through the scheme, while it was also a proud participant in its predecessor, the Coronavirus Business Interruption Loan Scheme (CBILS). The bank is yet to make a claim on the taxpayer backed guarantee, with a focus on sensible, prudent lending.
Atom bank has also repeatedly taken action to ensure that its range of commercial mortgage products is as competitive as possible, delivering value for the nation’s SMEs. It recently reduced the interest rates on a raft of commercial mortgage products by up to 0.33%, including cuts of as much as 0.25% on large commercial mortgages.
In addition, the maximum loan-to-value (LTV) available on large commercial mortgages has also been increased following feedback from brokers, so that mortgages of up to £5 million can now be obtained at up to 75% LTV against the market valuation
Working with brokers
Atom bank has worked closely with commercial mortgage brokers to identify potential improvements to its commercial application processes which will provide both intermediaries and their clients with a slicker experience, making more than 100 significant changes to the broker portal and underwriting process over the last 12 months alone.
These include the ability to instruct a valuation at any point before the approval in principle is issued, which can reduce the time from offer to completion by as much as seven weeks, while brokers are also able to obtain a swift indicative quote upfront by using the ‘Quick Quote’ tool in the Atom bank broker portal.
These changes have provided material improvements in Atom bank’s service proposition over the last 12 months, slashing the elapsed time between application and the issuing of an agreement in principle (AIP) by 94%, with AIPs now typically provided on the same day. The timeframe between application and offer has similarly been dramatically reduced, down by 61%, with offers currently delivered within 14 working days on average.
In addition, Atom bank has been able to significantly increase its capacity due to the process upgrades, resulting in 83% more offers being delivered in the 2023/24 financial year than in 2022/23.
Tom Renwick, Head of Business Lending at Atom bank commented:
“Hitting the £1 billion milestone serves as a moment for reflection and represents an opportune moment to look back on how far we’ve come as a business. We know what it’s like to start a business, we’ve been there and done it, so we are fiercely passionate about helping SMEs wherever they are on their journey.
“In the eight years since Atom bank launched, we have sought to do the right thing by brokers and their clients by taking on board their feedback, which has been invaluable in improving and building our presence in the market. Over the last 12 months in particular we have had a laser focus on automating and digitising the process where possible, delivering a faster and smoother experience, and we have seen huge improvements which we know have been valued.
“We will celebrate this milestone and want to thank our intermediary partners for their support over the years. Looking ahead, we are determined to keep innovating and identifying ways in which we can deliver even greater levels of support to the nation’s SMEs, so watch this space.”
