Following months of speculation, LHV UK has now confirmed that it has established a new foothold in the fintech capital of the North; opening the doors of its brand new Leeds office.
Counting over 200 prominent fintech and crypto companies amongst its clientele, including Paysafe, Blockchain, Currencycloud, Coinbase, Trustly, Monese and Wise, the banking services provider announced the official opening of its second UK office in Leeds this week. Among its 200 clientele, 20 are confirmed fintech unicorns.
The office is of considerable space and size, with 30 in-house positions available, it’ll be the Company’s engineering and development teams that’ll initially take the front seat, working to develop a proprietary online customer portal specifically tailored for its B2B fintech clients.
Beyond the ‘London Bubble’, the UK is rife with thriving fintech and financial communities. A recent report by the City of London Corporation highlighted the UK as the top destination in Europe for foreign fintech investment.
Its report identified that in 2021, 169 foreign companies invested £1.1billion ($1.26billion) into the UK’s financial services sector, being spread around 189 different projects. Of the £600million that was invested in London’s 114 projects, a remaining £500million spilt over into the city’s neighbouring fintech communities; with Leeds being no exception.
According to the findings of local outlets, Leeds’ booming financial sector attracted £34.5million in venture capital investment in 2020. But it wasn’t just the digital figures Leeds was able to attract. Indeed, the Financial Conduct Authority (FCA) is due to complete the opening of its new data centre there by the end of this year.
Undoubtedly, there were many elements for LHV UK to consider in its search for its second UK base. Speaking exclusively to The Fintech Times, Erki Kilu, CEO of LHV UK, said: “We were thinking about many different places, but in the north, we considered Manchester, Leeds and Sheffield. Somehow we felt that Leeds was the right answer.
“We made an in-depth analysis of who is available, how many and what type of universities there are, whilst also talking to different people who have made a similar decision.”
He continues: “Whilst we are confident that our London-based operations will continue to do well, we are also aware that there are growing fintech ecosystems across the country, and we’re keen to invest in the regional development of the fintech space.”
Native-northerner Rebecca Wright, chief people officer of LHV UK, added to this with: “Leeds is a really thriving centre for great tech minds. There are some really fantastic businesses that have been founded in Leeds. There are really high levels of entrepreneurialism.
“We felt strongly that it would be a really great location to go and be a part of a broader tech community. So it would offer opportunities to collaborate, as well as potentially work in partnership on certain things.
“But definitely, we felt that there were a lot of synergies between our business and the businesses that have ultimately thrived and done amazing things in the north.”
The banking licence future for LHV UK
In addition to broadening its UK presence, the Company is in the process of pursuing a UK banking licence as part of the parent LHV Group’s plans to separate the business operations of its retail bank, LHV Bank, from those of the London headquartered fintech focussed LHV UK.
This is because, since 2018, the Company has operated in the UK as LHV Bank’s UK branch.
Acquiring a banking licence would simplify compliance with regulatory and supervisory requirements and enable LHV UK to highlight its value proposition and the profitability of its operations to new investors.
As the complete separation will also include staffing and technology, management decided to establish a strong presence in Leeds.
LHV UK’s banking licence is subject to regulatory approval by the Prudential Regulatory Authority and the FCA.
“If London is the undisputed fintech capital of Europe, then Leeds is the fintech capital of the North,” comments Macs Dickinson, lead engineering Manager at LHV UK. “Last year, Leeds was named one of the fastest-growing tech cities according to Digital Economy Council, and the city is already home to more than 30 national and international banks. As the city is a location for the first fintech accelerator outside of London, it is an ideal second base for LHV UK.”
Wright added: “Leeds presents us with a truly unique opportunity to attract some of the best industry talent. The Leeds tech community is overflowing with talented, forward-thinking and entrepreneurial individuals. We undoubtedly have as much talent here as Silicon Valley, and I want people to be writing about how to get a job at LHV UK, not just Google, as we have fantastic opportunities for software engineers at all stages of their careers.
“LHV UK is possibly one of the best-kept secrets in Yorkshire right now. Not only is our parent company, LHV Group, listed on the Nasdaq Baltic Stock Exchange with a market cap of over a billion Euros, but we also provide banking services to 20 clients that are fintech unicorns in their own right.
“The decision to find a secondary office to preserve and build on this success wasn’t easy, but I am confident that Leeds is the best place for us to be.”