Perenna, a new bank aiming to revolutionize the UK mortgage market, has secured an additional £43 million equity investment. This funding will enable the company to implement its long-term fixed rate mortgage solutions following the approval of its UK banking licence. The successful fundraise was led by Perenna’s strategic investor Silverstripe Investment Management, and brings the total raised since 2020 to almost $90m.
Perenna’s unique approach involves funding its mortgages with covered bonds issued to institutional investors seeking long-term stable income, a model billed as the first of its kind in the UK. By offering long-term fixed-rate mortgages, the company aims to tackle various structural home-ownership challenges, ranging from affordability for first-time buyers to interest rate volatility mitigation and increased choice and flexibility in later life.
The proceeds will be used to launch Perenna Mortgage, offering 20-30 year fixed rate products, to the over 5,000 strong waitlist. Eligible waitlist applicants will be able to apply in the coming weeks, with the company opening up to the wider public later in the year.
“This successful fundraise, set against the backdrop of a challenging fundraising market, is a clear testament to the strength of our unique approach and the significant opportunity to reimagine the structure of the UK mortgage market,” said Arjan Verbeek, CEO and co-founder.
According to Hamish Peacocke, CCO and co-founder, “The UK is a clear outlier when compared to other advanced economies like the US and Denmark. The market is in dire need of reform at a time when homeowners are battling a range of challenges.”
This funding will enable Perenna to help transform the UK mortgage market and potentially other international markets where similar structural problems exist.