The planned sale of Atom Bank, one of the UK’s digital challenger banks, is reportedly close to falling through. According to an update from the Financial Times, the Newcastle-based lender has been unable to attract bids at the £600 million level its shareholders had been targeting. Industry sources indicate that interest from potential buyers has fallen short of expectations.
A private equity firm, Pollen Street Capital, submitted an offer, but it was below the threshold sought by Atom’s investors.
That proposal had reportedly included the possibility of combining Atom with Pollen Street’s existing digital bank, Tandem.
Other parties that had shown initial interest, including major building societies such as Yorkshire Building Society and Leeds Building Society, ultimately chose not to proceed with formal bids.
Atom Bank was established in 2014 as the UK’s first fully digital, branchless bank.
It received its full banking licence shortly afterwards and has focused on mobile-first savings accounts and mortgages.
The bank now serves approximately 250,000 customers and has built a substantial portfolio of savings deposits and residential mortgages.
Its founders include Mark Mullen, who has served as chief executive since inception, and Anthony Thomson, co-founder of Metro Bank. Mullen previously held senior roles at HSBC, including chief executive of first direct.
In 2025, Atom completed a funding round that valued the business at around £350 million, a notable reduction from earlier valuations.
The latest capital raise came as the bank shifted focus away from a potential initial public offering toward a private sale process.
Investment bank Jefferies was appointed to oversee the auction.
The £600 million asking price has been viewed by some observers as ambitious given the recent funding valuation and broader market conditions for challenger banks.
With the sale process appearing to stall, Atom’s shareholders—including Spanish banking group BBVA, Toscafund, and Infinity Investment Partners—are now said to be considering alternative strategic options.
Reports suggest these could include governance or leadership changes at the bank.
A collapse of the sale would mark a significant setback for Atom after months of discussions.
As first reported by the FT, the bank has operated profitably in recent periods while continuing to grow its customer base and lending book in a competitive UK retail banking sector.
However, like many digital lenders, it has faced challenges in scaling efficiently and achieving the high valuations seen during the fintech boom of the early 2020s.For now, Atom Bank continues to operate independently. Any decision to abandon the sale process would likely trigger fresh internal reviews about the bank’s long-term direction and management structure
