he Bank of London is to hire 300 staff and formally applied to the EU for a banking licence, it said today, as it embarked on a major expansion across Europe.
The bank said it would set up a base in Luxembourg as part of a 200 million euro (£170 million) investment that would see it build a workforce of 300 in the country over five years.
“The Bank of London, powered by its patented technologies, has a unique business model that actively protects its depositors’ funds by never lending, leveraging or investing these deposits,” the bank said.
“By choosing Luxembourg as its EU headquarters, there is an exciting opportunity to offer Luxembourg and the broader EU market a new global digital clearing ecosystem for financial institutions and corporate commercial clients.”
Bank of London founder Anthony Watson said: “Luxembourg is the logical choice for us to build out our offering across the EU, and marks the latest step in our international growth strategy and follows the successful rollout of our banking solutions across the UK.”
The plans make the Bank of London the latest London fintech to be eyeing European expansion after there were reports that Monzo is preparing a bid to merge with its Nordic rival Lunar.
The mobile bank is holding discussions with Denmark-based Lunar over the terms of the deal, according to a report by Bloomberg. It is also considering other acquisitions in Europe.
Lunar, a digital bank with over 650,000 users across Denmark, Sweden and Norway, hit a valuation of $2.2 billion after a fresh funding round last year, while Monzo’s valuation reached $4.5 billion in 2021.
Monzo declined to comment.
The Bank of London’s hopes for an EU license come as a growing number of London fintechs complain of difficulties seeking regulatory approval in the UK.
The approval rate of applications for Electronic Money Institution status, required for processing digital cash payments, fell to just 8% in 2022, figures obtained from the Financial Conduct Authority via a Freedom of Information request show, amounting to just 33 approvals. That compares to an approval rate of 90% in 2018 and a rate of 47% in 2021.
The Bank of London was founded in 2021 by entrepreneur Anthony Watson, who has a net worth of £307 million according to the Evening Standard Tech Rich List.
The bank made headlines earlier this year when it unveiled plans to acquire the UK arm of the now-defunct Silicon Valley Bank, before being pipped to the post by a rival bid from HSBC, who has since renamed the entity ‘HSBC Innovation Banking.’
