Several so-called “challenger banks” have popped up in the U.K. in recent years, with smaller financial institutions looking to promote competition in a banking industry largely dominated by a few large banks.
In the corporate banking sphere, the U.K. is set to gain another market entrant.
Reports on Wednesday (Aug. 3) said Copernicus Bank is slated to become the nation’s latest challenger bank and will target corporate clients. Founded and backed by Danela Ventures Partners Limited, Copernicus Bank “will run an open ledger/balance sheet available daily and not engage in deposit-based maturity/risk transformation.”
Those are the words of Michael Rossman, who founded the Danela Ventures advisory firm in 2010 alongside Aidan Brady, according to reports by Banking Technology.
Reports added that the bank has been in development since 2012. It is unclear, however, when the bank will officially launch.
Challenger banks are viewed by industry analysts as an attempt to inject competition into the banking sector and provide better services to customers. But a report released by KPMG last year found that challenger banks aren’t successful in their efforts to boost services to small business customers.
Part of the problem, analysts found, is that many challenger banks are offshoots of the Big Five banks themselves.
Reports did not indicate whether Copernicus Bank will focus on SMEs or larger corporations.