Recognise Bank, a subsidiary of City of London Group (COLG), has had its deposit restrictions lifted by the Prudential Regulation Authority, enabling it to launch its personal and business savings products and to start taking deposits.
Recognise will launch its Financial Services Compensation Scheme protected personal savings products tomorrow, and business saving products will be available in due course.
Philip Jenks, chairman of COLG, said the lifting of deposit restrictions was a major milestone for the firm.
He said: We have completed the final step on the journey to becoming a fully authorised digitally led bank which has been our primary objective for three years.
"We have grown the Recognise employee base to over 60 high calibre members and secured a strong executive team, led by Jason Oakley as chief executive.”
In August, COLG sold its advice firm Acorn to Oaks Financial Services as it re-focused the business on its banking arm.
The firm sold Acorn to Oaks back to the firm’s founders for £1.15m, after acquiring it in July 2018 for £1.4m.
It also said it would sell Milton Homes, an equity release provider it acquired in 2017, and completed a £18.3m fundraise, £11.4m through a share subscription and a further open offer of £6.9m.
In a statement released today, Jenks added: "The recent capital raise and sale of Milton Homes will enable us to realise our strategic ambitions for Recognise Bank, namely increasing the size of the loan book with access to funding from depositors through our business and personal savings products."
The firm said the development of the bank has been a central part of COLG’s strategy, and it hopes it will address the funding and service gap experienced by ‘underserved’ SMEs.