LONDON — Digital lender Starling Bank plans to eliminate about 130 jobs as it restructures parts of its business and expands the use of artificial intelligence across its operations.
The layoffs represent about 3% of the bank’s workforce of more than 4,000 employees, the newspaper reported, citing the company.
Starling told the Financial Times that the restructuring follows the completion of several major projects and reflects broader efforts to streamline operations.
“While we are continuing to hire tech and AI engineers, we recently told colleagues that we are changing parts of our banking team structure to simplify how we operate, reduce instances of duplication, and drive further product delivery at pace,” the bank said in a statement.
Seeking to Improve Efficiencies
The job cuts come as Starling works to improve efficiency following a challenging financial year.
The bank reported in May that revenue declined 6% to 887 million pounds (about $1.2 billion) during its most recent fiscal year, while pre-tax profit fell 3% to 217 million pounds (about $291 million). According to the Financial Times, the company attributed the declines largely to lower interest rates, which have reduced interest income across the banking sector.
The newspaper also noted that Starling’s growth has been constrained by restrictions imposed in 2021 by the Financial Conduct Authority following deficiencies identified in the bank’s financial crime controls.
Focus on BaaS
Rather than pursuing international expansion through traditional banking operations, Starling said in 2024 it would focus on growing overseas through Engine, its banking-as-a-service software platform. The company abandoned plans to obtain an Irish banking license in 2022 after determining it would not reapply for authorization that would have provided access to the European Union market.
