Challenger bank gets $1.9 billion valuation – is an IPO on the cards?

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    Judo Bank, which was founded just five years ago by funds from family offices, has now firmly cemented its position in Unicorn territory.

    The SME lender has just managed to raise $124 million in an equity raising that values the bank at $1.9 billion.

    Judo Bank is the largest in a number of recent start-ups in the banking industry and has been highly successful in the profitable SME lending sector, doubling the size of its loan book in the sector since March last year. It has shamelessly raided the big banks for lending talent to accelerate its growth.

    The bank, founded by David Hornery and former NAB big shot Joseph Healy, is also considering floating the company.

    “One of the things that we’ve always continued to evaluate is the potential to float the company,” Hornery told The Sydney Morning Herald. “There’s no decision made on that, it is an option that’s open to us, but equally the capital that we’ve got means that it’s something that we can do on our terms, our conditions and our timing.”

    The bank already has over 300 staff, and the timing Hornery talks about may be as soon as this November – the bank has already hired a raft of investment bankers, including Citigroup, Goldman Sachs, Credit Suisse and Barrenjoey Capital. The Australian reports that initial assessments pitch an IPO valuation of $2.5 to $3 billion – a handy return for the bank’s backers.

    Judo Bank

    Loan book $3.3 billion

    Employees 300

    Launch date 2018 (as Judo Capital)

    APRA grants ADI April 2019 (now Judo Bank)

    Achieves Unicorn status May 2020 (valued at $1.6 billion)

    Original Article