The Bank of London launches in UK with $1.1bn valuation
A new clearing bank, The Bank of London, has launched in the UK with plans to simplify the “complex and confusing” global transaction banking system and open up $1 trillion worth of revenues to UK SMEs and multinationals.
The company is founded by former Barclays chief information officer for Europe, Middle East and global operations Anthony Watson and Goldman Sachs veteran Harvey Schwartz.
It is only the second new clearing bank to launch in the UK in more than 250 years.
Billing itself as the “world’s first purpose-built global clearing, agency and transaction bank”, the firm enters the market with a $1.1 billion valuation, which it claims makes it the first pre-revenue bank in history to attain unicorn status upon debut. It has raised $120 million in funding to date.
The bank hopes to democratise “the sleepy backwater of domestic and international transaction banking” through global cash management, foreign exchange, treasury, liquidity and corporate banking products.
The Bank of London will also provide non-bank firms end-to-end BaaS products and services, offering embedded financial services from payments and cards to multi-currency current, deposit, safeguarding or savings bank accounts.
The company has plans to hire over 3,000 people across the UK, EU and North America over the next five years and is in advanced talks with regulators in the EU and North America.
Watson says the bank will “remove unnecessary risk, unlock liquidity and deliver products and services at significantly lower costs to enable near instant settlement without a financial intermediary in the flow of funds”.
Schwartz — who spent 21 years at Goldman Sachs — adds the bank will address and simplify the “arcane” clearing and transaction banking system.
He says: “During the great financial crisis, I saw first-hand how the legacy payments, clearing and settlement processes that are at the heart of the global financial system contributed to bringing the world’s economies to their knees, through their inefficiencies and inherent liquidity risk.”