A bid has been launched to set up a new bank in the North East that could support development in the regions and create a number of highly skilled jobs.
GBB, which is based in Newcastle and led by an experienced management team, has formally applied to the Prudential Regulation Authority (PRA) for a licence to trade as a bank.
The company intends to provide tailored lending to regional SME property developers for both residential and commercial property development, as well as fixed rate savings products to retail customers.
If granted a licence, GBB will offer secured property development loans of between £1m and £5m, with an aim of putting 90% of loans into supporting regional property developers and SME construction companies. It also hopes to provide competitive fixed rate deposit rates for savers.
Steve Deutsch, GBB’s chief executive officer, was previously chief executive at the Weslyan Bank in the Midlands, and spent almost 20 years in senior roles at Lloyds TSB. The senior management team also includes former Atom Bank, Virgin Money and Santander executives.
Mr Deutsch said the bank was now focussed on raising the finance it needs to meet regulatory requirements on capital levels.
He added: “The UK’s undersupply of housing offers a clear market opportunity. We know that 66% of property developers are borrowing now, with 90% intending to borrow in the next three years.
“Our ambition is to become an engine of economic growth for regional SME developers by providing bespoke secured finance underpinned by long-term relationships that build trust and generate repeat business.
“This will be funded by highly competitive fixed term savings products, aimed at customers looking to deposit between £5k-£100k of savings. We want to be a reliable source of income for savers in the easiest possible way.
“Our lack of legacy systems or branches and a model that is supported by modern technology results in a low-cost income ratio that benefits customers and investors alike.”
GBB’s chief lending officer Stephen Henman said: “Our key differentiator is our regional and property development focus combined with a relationship centred approach, which is unlike anything else on the market.
“This, combined with our specialist underwriting capabilities, local knowledge and market-leading, cloud based technology, puts clear water between us and other providers. We hope that this will lead to an increase in property development in our target regions.
“Our locally based relationship managers will be dedicated to onboarding customers, understanding and managing their ongoing needs and gathering market intelligence to ensure our support evolves with our client requirements. We value repeat business and see the benefit of long-lasting relationships for the customer and the Bank. As such customer service has been placed at the heart of this new GBB proposition to drive strong returns from the outset for our investors.”
GBB is based in Newcastle city centre but is currently securing new premises in the hope that it can triple its current headcount to around 60 in readiness for launch in 2021.
