PCF Bank has announced it will withdraw from the UK banking market after failing to raise capital and secure strategic options.

The lender had been seeking to raise further significant growth capital and pursued other strategic opportunities, but PCF says it “has now determined that significant growth capital will not be forthcoming and the strategic transactions have not come to fruition”.

PCF Bank will not recommence lending and will manage its loan and savings portfolio positions down over time in line with their respective terms and conditions while progressively reducing its cost base. 

Both the Prudential Regulation Authority (PRA) and the Financial Conduct Authority (FCA) have been kept informed of the lender’s plans.

Somers Limited, the company’s substantial shareholder, has indicated that it “remains supportive” of the company through this process.

PCF Bank chief executive Garry Stran says: “This has been a very difficult strategic decision for the Board to make given the consequences for the business, colleagues, customers, intermediaries and shareholders.”

“This is particularly so given the considerable progress made over the last 18 months to remediate the issues that gave rise to the suspension in trading in the group’s shares in May 2021 and the work undertaken in seeking to raise growth funding or progress other transactional strategies to deliver a growing and sustainable value proposition for all our stakeholders. The company will now focus on implementing our decision.”

On 5 October, the bank announced it continued to be engaged in its objectives of seeking to raise further growth capital.

However, it said that “the raising of such capital is not guaranteed, nor is the completion of any of the other strategic options”. 

The board also decided to suspend new lending activities.