LHV Bank has been formally granted consumer credit permission by the UK Prudential Regulation Authority (PRA), following a comprehensive and rigorous six-month application process.
The permission represents a significant regulatory milestone for LHV Bank in the UK and reflects a high degree of regulatory confidence in the bank’s governance, risk management, capital resilience and control environment. Consumer credit permissions are not granted lightly and require regulators to be satisfied that firms can manage credit risk safely and consistently across economic cycles.
The approval enables LHV Bank to expand its retail product offering, including plans to launch competitive overdraft facilities for current account customers in 2026.
As part of the PRA’s assessment, LHV Bank was subject to detailed scrutiny of its end-to-end credit frameworks, financial crime controls, operational resilience, capital adequacy and board-level oversight. The decision to grant permission reflects the regulator’s view that LHV Bank has the systems, controls and governance required to offer consumer credit responsibly within the UK banking system.
Erki Kilu, Chief Executive Officer of LHV Bank, said:
“Receiving consumer credit permission from the PRA is a strong endorsement of the robustness of our risk management and governance frameworks. These permissions are only granted where regulators have confidence that a bank can manage credit safely, at scale and over the long term.
“This outcome reflects substantial investment in our control environment, our people and our culture. It allows us to broaden our UK retail proposition while remaining firmly focused on prudent growth and responsible lending.”
Kris Brewster, Director of Retail Banking at LHV Bank, added:
“Overdrafts are a core feature of a full-service current account, and this permission allows us to develop a competitive product designed around customer needs and transparency. Our focus will be on delivering overdrafts that are simple, fair and aligned with responsible lending principles when we launch in 2026.”
