LONDON, 11 June 2026 – Starling Group Holdings Limited (“Starling”) has achieved record pricing for its debut £150m Tier 2 bond, in the first rated public sale by a European neobank, after international investors sought more than 2.5 times the notes on offer.
Starling’s fixed rate subordinated notes due in 2036, with a call option in 2031 and an investment grade Baa3 rating from Moody’s, priced at a coupon of 6.625%. At a spread of 223.7 basis points over reference rate UK Gilts, that’s the tightest ever pricing for a Tier 2 issuance under £200m.
NatWest and Morgan Stanley were Joint Lead Managers for the sale, with demand coming from major UK, European and international institutional investors and peaking over £400m.
Raman Bhatia, Starling’s Group Chief Executive Officer, said: “We are delighted with investors’ response to our debut bond offering, which is a first for the neobanking sector and reflects strong confidence in the long term potential of our Group.’’
Declan Ferguson, Group Chief Financial Officer, added: “By issuing Tier 2 notes we are starting to optimise our cost of capital and diversifying our regulatory capital base as our business matures.
“We will use the proceeds for general corporate purposes. We see significant opportunities to invest in Engine by Starling, our global Software-as-a-Service business, to acquire and consolidate other financial services businesses through our ongoing M&A strategy, and to explore the acquisition of a banking licence in another geography.’’
Moody’s has assigned Baa2 long-term deposit and issuer ratings to Starling Bank Limited, and a Baa3 issuer rating to Starling Group Holdings Limited, each with a stable outlook, alongside a Baa3 issue rating to the Tier 2 notes. In a public statement the ratings agency said its baseline credit assessment ‘reflects the bank’s strong capital and liquidity, stable deposit base and sound profitability’.
Starling last month published its full year results showing a fifth consecutive year of profitability, delivering £217.1m of profit before tax in the year ending 31 March 2026. Customer deposits rose to £12.7bn from £12.1bn a year earlier. After closing this bond sale the company will hold a capital surplus of more than £600m.
Starling has applied to list its subordinated notes on the International Securities Market of the London Stock Exchange once the issuance process is complete.