From June 2016 to September 2016, Aldermore increased its common equity tier one ratio, the main yardstick of a bank’s financial solidity, from 11.1 to 11.5%, above its 11% target level. The bank intends to differentiate itself from the few challenger banks that are yet to do so, such as Clydesdale and Yorkshire Banking Group and Metro Bank, according to Financial Times.
Furthermore, Aldermore became the first bank to draw on the “term funding scheme”, set up by the Bank of England recently to provide GBP 100m of cheap funds for banks to encourage lending to small businesses and households.
Despite optimistic views, bank analysts say that Aldermore’s capital would be hit by an increase in operational risk requirements in the first quarter of 2017 and by the interest payments on hybrid debt in the second quarter.
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