Victoria Raffé shared perspectives on the changing regulatory environment and other factors enabling challenger banks in the U.K. during the "How to Start a New Bank" Seminar.

1. AGILITI: HOW TO START A
NEW BANK
Victoria Raffé

2. The Stars are Aligned
Political will
Economic conditions
Regulatory support
Technical infrastructure
Funding
Customer mobility?

3. Different Shapes and Sizes
2012
4 Overseas Subs
1 Overseas Branch
2013
3 Overseas Subs
1 Overseas Branch
1 UK Standalone Bank
2014
1 Overseas Sub
3 Overseas Branches
2 UK Standalone Banks
New banks take many forms:
 Overseas entrants
 New start ups
 Passported branches
 License acquisition
 Divestments
 License extensions
 Specialist services “neo banks”
Firms on the starting blocks:
 Pre-application – 20
 Application assessment – 4
 Mobilisation – 2
Source: FCA 5/15

4. What’s stopping you?
Source: CMA Updated Issues Statement – Retail Banking. May 2015
Regulation?
Authorisation
Capital
AML
Regulatory “chill”
Intrinsic advantages?
Funding
Branches
IT
Payment Systems
Strategic advantages?
Intermediaries
Tying/bundling
Info. asymmetry

5. Spotlight on Authorisations (Option B)
Pre-application Application Period Mobilisation
Firm in lead
PRA/FCA Support:
- Pre-app meeting
- Challenge meeting
PRA/FCA assessment
Firm:
- Responds to Qs
- Can develop build
PRA/FCA Assessment
Firm completes
operational capabilities
and funding
Common Problems
Business model
Growth assumptions
Timeframes
Conduct
Raising capital
IT build-outs
Hiring staff
Capital and ownership
IT build and test
Outsourcing
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I dea A pply L icense G o

6. Capital Requirement
0
10
20
30
40
50
Capital (£m)

7. AGILITI: HOW TO START A
NEW BANK
Victoria Raffé