Shawbrook up on debut

CHALLENGER bank Shawbrook enjoyed a promising debut on the stock market yesterday – shares rose sharply to close up 16p at 306p on their first day trading.

Existing shareholders have enjoyed a big pay day, sharing £127.5m in total.

Chairman Sir George Mathewson – a former chief executive and then chairman of Royal Bank of Scotland until 2006 – has sold shares worth £897,000 as part of the float. Commercial mortgages boss Stephen Johnson scooped £3.7m.

The Essex-based lender was priced at 290p, towards the upper end of the original 255p to 305p range set last week.

This values the lender – which focuses on lending to small and medium- sized businesses – at £725m.

The flotation comes only two weeks after rival upstart Aldermore made its debut on the stock market, although it had to cut the price of its shares to attract investors having initially postponed a float last year. Shares in the firm have risen more than 20pc since then.

Shawbrook was founded in 2011, one of several ‘challenger banks’ to emerge since the financial crisis.

The bank’s total lending grew by £900m to reach £2.3bn last year. It is backed by private equity fund Pollen Street Capital, previously SOF Investments, spun out of RBS in 2013.

The remaining £90m from the sale of 75m shares will fuel growth, the bank said.

Chief executive Richard Pyman said the firm’s ‘focus remains on providing UK customers with a fresh, pragmatic approach to lending and savings’.

Shawbrook chairman Sir George Mathewson is expected to step down shortly, having announced plans to leave once a successor is found.