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A new landscape: Challenger banking annual results

By KPMG | 9th May 2016

A new landscape: Challenger banking annual results

Simple business models, digital focus and competitive products are contributing to the rise of the challenger banks who aren’t suffering the remediation costs and legacy issues of the big banks.

This article was published by home.kpmg.com

Challenger banks are once again outperforming the Big Five incumbents on growth, cost-to-income and return on equity. As they march to stronger profits, the big banks are stumbling on remediation costs and legacy issues.

The outlook for UK Challenger Banks

KPMG Head of Challenger Banking, Warren Mead, says the outlook is positive for UK Challenger banks but there are clouds on the horizon.

A new landscape analyses the financial results of the Challenger banks, in relation to the Big Five UK retail banks: Barclays, HSBC, Lloyds Banking Group, Royal Bank of Scotland and Santander. It pinpoints new market players and delves into the key trends underpinning this exciting and fast-evolving sector’s success.  

New additions to this year’s report include:

  • An overview of Digitally Focused Challengers, the newest breed of Challenger.
  • Exclusive interviews with Atom, Starling and Fidor Bank, each of whom reveals how they aim to give customers the best banking products and services.
  • An assessment of recent regulatory and tax changes to the buy-to-let market and the potential impact this will have on Challengers’ profitability going forwards.
  • Analysis of thousands of data points on the savings rates offered by Challengers and the Big Five. 

Read the report