Shawbrook Bank has announced plans to list on the London Stock Exchange, marking a significant move that could value the specialist lender at up to £2 billion. This initial public offering (IPO), delayed earlier in the year due to market volatility, signals a notable vote of confidence in the UK’s capital markets at a time when London is striving to revive its stock market appeal amid intensified competition from rival exchanges such as New York.

The flotation is expected to support Shawbrook’s growth strategy by increasing its profile in the UK while providing an opportunity for its private equity owners, BC Partners and Pollen Street, to realise some returns on their investment since taking the company private in 2017. According to CEO Marcelino Castrillo, this IPO milestone reflects the bank’s evolution into a scaled and diversified platform with significant growth potential. Shawbrook plans to offer a minimum free float of 10%, targeting a blend of retail and institutional investors, with ambitions to be included in FTSE indices.

Founded in 2011, Shawbrook has expanded impressively, growing its loan book from £1.4 billion in 2013 to £17 billion as of June 2025, covering specialist lending to professional landlords, property investors, complex income homeowners, and motor finance customers across both mass market and luxury segments. The bank has set an ambitious “30 by 30” target to nearly double this portfolio to around £30 billion by 2030, alongside delivering mid-to-high teens annual growth in underlying profit before tax and maintaining a strong return on tangible equity. Recent acquisitions, including The Mortgage Lender in 2021 and Bluestone Mortgages in 2023, further underpin its expansion plans.

This IPO is part of a broader effort by the UK government to rejuvenate the London stock market, which has seen a significant slowdown in listings in recent years. Government figures reveal that London has fallen behind cities like Mexico and Singapore in IPO fundraising, while some large UK-listed companies with substantial US business or shareholders are reportedly considering moves to American exchanges. To counter this trend, influential figures such as Chancellor Rachel Reeves are actively engaging with potential listing candidates—including OakNorth, Starling, and others—at events hosted by major investment banks such as Goldman Sachs and JP Morgan. The government is reportedly contemplating incentives like a stamp duty holiday on newly-listed shares, responding to calls for scrapping the 0.5% tax on share trading entirely to enhance London’s attractiveness.

Shawbrook’s announcement comes amid a recent flurry of listings after a particularly subdued year for London’s IPO market. Other businesses including Beauty Tech Group, Princes (known for brands like Branston baked beans and Napolina olive oil), and US data centre giant Fermi have also debuted in London. There is mounting speculation that digital banking giant Revolut may pursue a dual listing in London and New York. Industry experts, such as Laura Janssens of Berenberg, suggest that the end of 2025 could mark a turning point for UK IPO activity, rekindling optimism that London can reclaim its status as a global financial hub.

Victoria Scholar, head of investment at Interactive Investor, reflected this optimism by highlighting Shawbrook’s potential flotation as a positive development for London’s stock market. Nonetheless, concerns remain following AstraZeneca’s recent decision to list directly on Wall Street, underscoring the ongoing challenge London faces in retaining major companies. Broker analysis underscores this tension; AJ Bell has identified ten London-listed firms worth approximately £620 billion that have strong US ties and may be tempted to switch exchanges.

Shawbrook’s IPO candidly embodies the current crossroads of UK capital markets, representing both the opportunities for growth and recovery, as well as the competition and challenges London must navigate to re-establish itself as a premier venue for public listings.

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Source: Noah Wire Services