Challenger bank for UK SMEs, Allica, secures additional £55m funding

Allica Bank, a UK-based bank for SMEs, has secured £55 million in additional funding, following on from the £110 million Series B funding round last November.

Allica Bank raises £55m in additional funding

The total funding raised by Allica now stands at £285 million.

British Business Investments, a wholly-owned commercial subsidiary of the British Business Bank, provided Allica with a £30 million Tier 2 capital facility.

Existing investors – Atalaya Capital Management and Warwick Capital Partners (who led the Series B round) – committed £25 million in equity.

The challenger bank states it intends to “continue to take on the mainstream ‘high street’ banking market for established, growing SMEs”.

Its lending portfolio includes commercial mortgages and asset finance, and it also offers business and retail savings products and services.

Allica plans to launch a new SME business account this year.

In 2021, the bank reported “exceptional performance in 2021 across all aspects of the business” as its SME lending grew to over £560 million (more than 12 times higher compared to the previous year) and the deposits grew to over £800 million.

It is forecasting to complete £3 billion of lending to established SMEs in the next three years.

Annual net operating income increased to £7.8 million in 2021, and April year to date net operating income has already exceeded this at £10.1 million, driving the bank towards monthly profitability in 2022.

Allica received its full banking authorisation in September 2019 and opened for business in March 2020.