Atom Bank and the bank are will be interchangeable

Atom Bank was founded in 2014 as the first app-based bank in the United Kingdom. It was UK's first digital bank to receive a regulatory license. The founder of Atom Bank is Anthony Thompson. Anthony, a marketer by profession, he specialized in the marketing for Financial Institutions. In an interview with Agustin Rubini, Anthony says, "It's easy to start a Fintech startup that's not a bank with a relatively small amount of money, but if you want to be a bank it requires a lot of capital." (Fintech Founders, Rubini, 2020)

Anthony worked for a major marketing firm in Europe, which helped spot opportunities based off insights he gained from market data. In the early 2000s, he noticed the customers wanted value which traditional banks perceived as price. In the interview with Agustin Rubini, Anthony stated the wants of customers, according the data service, convenience, and consistency from their banks. That led to a the creation of Metro Bank in 2010. In 2012, Anthony saw the shift in consumer behavior from traditional branch-based banking to digital banking, particularly mobile banking. From that shift, Anthony founded Atom Bank.

In the creation of Atom Bank, Anthony pitched his idea to private and institutional investors such as: BBVA, Woodford Investment Management and Toscafund Asset Management. Using his connections and experience gained from Metro Bank, altogether, Atom has raised 450,000,000 pounds ($525,593,482)

The problem to secure a mortgage loan is bureaucratic at best. The process is filled with uncertainty and several touchpoints that could be the deciding factor of getting approved for a mortgage loan. Atom Bank aims to become the fastest growing lender in the UK. The secondary problem Atom Bank strives to fix is the low interest rate on saving accounts. In the UK, in 2021, interest rates were a record low of 0.35%, which is 97% less than the highest interest rate in 1990 of 13.56%.

Atom Bank's customers range from individuals that want to own their home or build their own businesses and businesses looking to secure loans for their growth. In the Annual Report for 2021-2022 their customer deposits totaled 3.2 billion pounds up from 2.2 billion in 2021. For this to be possible the bank has a 'built for digital' business model, the Bank offers it's customers a faster and simplified way of banking. The advantage that it uses is to engineer the lowest costs in the industry, and invest those savings in innovation and growth. That type of business model also gives them the ability to give out high interest rates on the saving accounts for their customers.

Atom Bank develops their own apps, micro-services, technology and data architecture, integration, testing, security and DevOps. For their data driven aspects they use programming languages such as JavaScript, Python, Java, Swift, Kotlin, Linux, and Groovy and Django. They also take advantage of open source environments such as Node.js. Applications for database usage include MongoDB and Google Cloud.

Atom Bank resides in the digital banking domain of Fintech.

Between 2017 and 2019, the number of consumers who visited a branch 10 or more times per year declined from 35.4% to 28.4%. In the U.S. two-thirds (65.3) of the population uses digital banking services. While almost 80 percent of millennials reported using digital banking in 2022, only 48.5 percent of baby boomers reported the same. Other digital banks, such as Ally Bank and Discover Bank, are experiencing a period of rapid growth, with the digital banking market estimated to be $4.3 billion in 2021. An estimated 203 million people use digital banking services in 2022, and that number is projected to reach 216.8 million by 2025. Without the cost of establishing and operating physical branches, digital banks can redirect those funds elsewhere, such as yields offered on savings products or ATM fee reimbursements. Most of the top savings account rates are offered by digital banks.

Atom Bank'a competitors in the UK include:

• Wise (formally TransferWise)
• Monzo
• Starling
• Monese
• Anna
• TreeCard

Atom Bank's impact on the banking industry has undercut it's competitors in terms of cost, fluidity of their digital system, and high yields for it's customers' savings account. Currently, the bank is operating at a 2 million pounds operating loss, a significant decrease from 36 million pounds in 2021. The bank's Instant saving accounts yield a 2.55% interest rate and up to 4.65% for their Fixed Rate Savings accounts.

Core metrics to measure a the bank's performance are:

• Net Interst Margin
• Total Capital Ratio
• Income to cost growth ratio

• Net Interst Margin = 126 bps (basis points) in 2022 up from 42 bps in 2021
• Total Capital Ratio = 21.6% in 2022 increased from 16.4% in 2021
• Income to cost growth ratio = 203% in 2022 decreased from 529% in 2021

The Income to cost growth ratio has a steep decline from 2021 to 2022, still Atom Bank remains a major digital bank in the UK. It's main driver of growth comes from it's business lending with secured loans at 495 million pounds in 2022, an increase from 2021 and unsecured loans at 440 million pounds in 2022 an increase from 2021. Total assets increased to 4.6 billion in 2022. Solidifying Atom Banks position in the UK as one of it's premier digital banks.

• The recommendations to Atom Bank for increasing its financial repertoire would be introducing budgetary services to it's retail and business customers.

• Introducing budgetary services to individuals and businesses will increase the trust in the bank. Imagine if customers could plug in or scan an item for a dollar amount for what they want to spend and compare that to the amount of income they receive on a daily, monthly, or yearly basis. Customers could make better financial decisions. Customers who can look to their bank for assistance and guidance to make sound financial decisions will become loyal and through the utilization of 'word of mouth' marketing, the banks' total assets, social and financial footprint will increase.

• Since Atom Bank typically keeps everything in house. The bank will need to create accounting software that can seamlessly fit into their digital ecosystem, keeping it simplified for the everyday consumer and specialized for it's business and high net worth customers.

• The trust in the banks, specifically, traditional banks, are constantly wavering in and out of favor, with an emphasis on the latter. For Atom Bank to continue it's growth, a study of the issues created from traditional banking is mandatory. Customers want to know their money is safe. Customers want to know if they are spending more than they earn. In that niche, Atom Bank with budgetary services has the potential to become a digital banking behemoth.