Challenger bank focused on growth in Yorkshire

Less than 12 months ago TheBusinessDesk.com sat down with Deepesh Thakrar to talk about OakNorth Bank’s growing presence in the North and plans to launch a Yorkshire office in 2021.

That conversation took place in the interim period between lockdown one and lockdown two. But with the country now in its third lockdown are the hopes still the same for the challenger bank?

Put simply yes! James Espley, director of property and debt finance at the firm is its man on the ground in the region and he explains how they’re committed to growing their presence in Yorkshire.

“The bank traditionally, from its conception was pretty much London focused in the early years, but spotted a really good opportunity in the regions in the last few years” he explains.

“With the opening of the Manchester lending office, I was brought in to OakNorth Bank to cover the Yorkshire side, having spent the last almost 20 years working in property in the region, mostly in Leeds but with time in Sheffield and Hull. With the remit to grow both the business and the team, and ultimately set up the office.”

He adds despite the pandemic none of the plans have changed and that OakNorth Bank is still committed to launching an office this year, but caveats that it “will depend on recruitment”.

The expansion he says will involve bringing in more people perhaps on the corporate side of the business to cover corporate and trading facilities – an area currently serviced out of Manchester, as well as bringing in an associate director for the property team.

He adds that the crucial thing is getting the right people but he envisages that by the end of Q2 2021 they would expect to have the team in place and be searching for an office “probably in Leeds”.

It’s clear however that the ambition for the bank to “put down roots” in the city isn’t pie in the sky. Espley states: “If [the right] people were available [to create the team] tomorrow, we would do it tomorrow”.

Away from the firm’s office ambitions, Espley explains the opportunities he sees within the property market. The first has been in the residential market, where he adds “there’s alot of demand in Yorkshire” and that over the last 12 months the firm has seen an increased number proposals put forward – including an application for a £4.9m CBILS loan to Church Farm South Stainley Developments near Harrogate.

Talking of levels, he adds that having joined the business in January 2020 and had ” two months of normality before a global pandemic” in the last year he took over £80m of deals to the firm’s credit committee. Adding that £75m were approved and about 50% of those were residential developments.

Espley adds that the firm views development finance as a strong growth area for the business as there aren’t many organisations currently doing that.

“My background is purely mainstream banks, Barclays, Santander etc. and these kinds of operators are not really in the market for development finance. So [our] actual competitors are few and far between, which means we see it as a particularly strong growth area in Yorkshire where we want to grow in the coming years.”

Away from the resi-market he adds there’s potential growth in the retirement living sector an area which he feels will continue to grow its links with care homes – a sector alongside hotels which Oak North has continued to grow in over recent years.

So, what does 2021 have in store aside from an eventual new office, “get the name of OakNorth Bank more recognised certainly in the Yorkshire region, increase the volumes we’re doing.”

As the call ends its clear that Espley like Thakrar last year sees Yorkshire as a prime location for Oak North’s future and growth.

OakNorth Bank are one of the partners for the upcoming Invest North virtual conference on 24 March which will bring together key business and policy leaders to set the economic agenda for the North moving forward.