This article was originally published by The Intermediary on 18 August 2026.
Recognise Bank has faced highs and lows since its foundation in 2017. Despite quickly establishing a sizeable lending and deposit operation, sustainable profitability was a challenge, particularly in the face of high costs and market volatility.
In late 2024, CEO Simon Bateman arrived on the scene with a remit to “restart the startup.” His work, alongside a refreshed executive team, would ultimately take the bank from loss to profit within a few short years.
The Intermediary sat down with Bateman to find out how the bank, having posted a post-tax profit of £8.9m for the year ended March 2026, plans to step into its next phase.
Not a ‘little big bank’
Bateman traces his career from Santander through to Lloyds, Aldermore, Harrods Bank, Allica and Nomo Fintech. The recurring theme has been technology, transformation, cost-efficiency and scaling, while his move from large institutions into smaller banks has given Bateman experience on both sides of the industry.
In late 2024, when it became clear that Recognise Bank needed a refreshed approach, and Bateman was “nervously excited” to bring all this experience to bear and take on the challenge.
He says: “Recognise has gone through a number of executive management changes and board changes, and with Parasol V27 coming on board as the primary investor, there was an opportunity to reinvigorate the business and restart, which also meant going back to its original specialist roots.
“It has been a rollercoaster ride of transformation into stability. The profits that we announced recently have shown that Recognise has indeed restarted.”
The first task facing Bateman as he took the helm was not simply to devise new products or grow lending; it was to rebuild the organisation to be capable of doing those things, sustainably and at scale.
A major advantage in this effort was the ability to construct a new executive team. Bateman brought people in with startup and scale-up experience, arguing that working in that environment requires a unique mentality.
He says: “It’s about the impact you can have in large organisations versus small ones – the level of governance and red tape that you have to get through to implement change can be suffocating and can restrict the pace of improvement.
“Working in a small organisation, the impact that you can have is instant. Decisions can be made very, very quickly.”
This team approached the Recognise Bank proposition with a semi-blank sheet of paper. No process was assumed to work merely because it already existed.
“It was very much a case of not leaving any stone unturned,” Bateman explains. “If it looks like it’s broken, it’s probably broken. If it looks like it works, let’s check that it actually does.
“We looked at everything – every single process, structure, report, governance meeting, forum. How do we communicate internally? What are the messages, what’s the strategy? How are we going to approach this business?”
The bank’s risk framework was reviewed and changed because, while not fundamentally wrong, it was disproportionate to the business. Unused tech was switched off, unnecessary supplier contracts terminated, and missing or underused frameworks were put firmly into place or refreshed.
Beneath it all was the understanding that Recognise was not on the path to becoming just another “little big bank,” but instead wanted to maintain the agility and adaptability that Bateman sees as one of its key selling points.
Transformation turning point
The 2024/25 financial year was primarily about laying foundations for future growth. While reporting £5.3m in losses, Bateman points out that this is a vast improvement compared with the year before, part of a steady positive trajectory.
The strategy has been focused on steady and controlled improvement, rather than, in Bateman’s words, wanting to “blow the doors off.”
On a practical level, this involved relaunching bridging, reducing costs and improving structural efficiency. Originally, the target was to “break even” in September 2025. When the bank reached that goal months early in May 2025, the mentality shifted to “we’ve done it now, we can’t go backwards.”
Bateman stresses that the work is “by no means done,” and says the approach now is to “accelerate that steady growth and take advantage of our flexibility.”
One of the next steps in this process is a move into regulated bridging, a market with “the capacity for additional lenders to join,” providing a good opportunity for Recognise Bank to expand and diversify. The bank also relaunched its commercial real estate product earlier this year.
Bateman suggests there will be a level of consolidation in the specialist market, due to constraints in the capital available to smaller lenders. Now that Recognise has set its course straight once again, the right acquisition may well be part of its future growth strategy.
He adds: “We will continue to evolve our product set, we’ll continue to work with the broker community, and we’ll continue to work with our strategic partners to look at what products they’re missing, and how we can find a way to find a solution.”
The bank aims for lending decisions to be made as fast and decisively as possible, as soon as all the necessary information is available, rather than being passed through five or six committees. The same principle applies to deposits – if the bank needs funding to support its lending, then waiting too long to react could mean the market has already moved on.
“If we’ve got to react quickly to bring in the right level of deposits to fund the lending side of the book, then we’ve got to be able to make decisions instantly,” says Bateman.
“We’ve got to be able to look at it from a risk perspective, a balancing perspective, an exposure perspective, and then get on with it. If you lose that ability, by the time you’ve reacted and made your move in the market, it’s too late.”
This is not about removing governance structures, Bateman explains: “It’s that we have proportionate governance. We have a very robust risk framework, which has been refreshed over the past 12 to 18 months.
“We have very robust decision forums. The way in which the information is presented is to get to a decision, not just to have a discussion. That’s the key.
“Obviously there’s a massive spotlight now from the regulators on ensuring that there isn’t another MFS bubbling away in the background.
“[The PRA has] confidence that this bank is now in a space where they would expect a small specialist lender to be, and it’s not on the watch list.”
A specialist role to play
During this transformation process, a defining characteristic is the willingness to make decisions, positioning itself as a “decisive bank.” For those borrowers with quirky cases, this is an opportunity for agile specialist lenders willing to interrogate the individual deal on the table.
This decisiveness cuts both ways. If something clearly falls outside of the bank’s risk appetite, Recognise aims to give borrowers a fast and fair ‘no’, so that they can find a solution elsewhere.
Bateman says: “We’ve been impressed with the volume of complex lending that’s needed in the market, and we’re starting to get a name for ourselves with our broker network and our strategic partners. People want to come to us to find out whether we’ll do a deal.
“There’s a level of nervousness across some of the larger organisations at the moment, because of uncertainty in the market. We are fortunate that our book is still quite small, but yet we are very ambitious on where we want to take that book and how we want to grow it. But in doing so, we’re not going to change the approach, the DNA of the business.”
Amid change and uncertainty, one thing has shifted very little – broker expectations, particularly around consistency from lenders. On the other side of this, Bateman adds, is the need for intermediaries to provide clear and correct information, and to engage in two-way communication with the bank.
He continues: “The communication between a specialist lender and broker is going to have to improve dramatically.
“Look at the introduction of portals and digital interfaces for brokers, do they really want them, or do we just think they want them? Is it making their life easier or our life easier? I don’t think anyone’s really addressed that yet.”
For Bateman, truly being a specialist means being defined by the borrower’s needs, not product labels. Market consolidation could risk some specialist lenders losing sight of this as they are subsumed by larger organisations.
The question that will take centre stage during Recognise’s next phase, then, is: how do you scale a specialist bank without institutionalising it out of the very attributes that make it specialist?
“Again, it comes back to that sustainable growth,” Bateman says. “Executing the business strategy, delivering profitable balance sheet growth, and offering the products to the market that the market needs rather than what we think they need.
“The offerings that Recognise delivers have a place in the market, and that market is getting bigger. Our challenge is to service that larger section of the market, to be flexible, and to make sure that we know what those products are. It’s making sure that we listen to our brokers, rather than trying to put a square peg in a round hole.
” Bateman’s tech-focused background gives him an unusually sceptical perspective, understanding that it cannot solve everything in this market.
For example, Recognise Bank’s refreshed strategy takes artificial intelligence (AI) into account only as a way to make its existing people more efficient.
Where a process can be sensibly automated, the preference is to do so, but this does not come with removing human involvement in individual deals, as long as systems work and tech is deployed properly.
He continues: “Smaller specialist lenders going into larger organisations will often be forced to take on channels that those larger organisations do. They’ve often invested millions on these systems, and they work for the original sector, so why wouldn’t it work for the specialist lender?
“Specialist lending is all about the relationship, communication, having the conversations with the brokers to understand the borrower’s needs. You can’t do that just with a digital interface. You also can’t do that just by picking up the phone. You need different technologies and interactions to get the best outcome.
“I’d like [brokers] not to get caught up in the ‘fear of missing out’ with AI, and not to select lenders that profess to have AI tools that will support pre-decisions.”
He adds: “We’re looking forward to having more broker events, getting their feedback, asking them what we can do differently, how we can operate differently, and the same will apply to our strategic partners.
“We’re on a journey as Recognise Bank, and without the support of the brokers and the strategic partners, that journey won’t last very long.”
Future-focused iteration
Even with the clear success of the past few years, Bateman is clear that there have been hard lessons learned along the way.
The new leadership was formed of people who had experience in transformation, with a “let’s get on with it” approach that has served them well. In hindsight, however, Bateman believes more time could have been spent ensuring that staff understood why the changes needed to happen. Subsequent profitability has been the proof in the pudding, but better communication might have secured buy-in earlier.
One difficult decision was to close the Manchester office and move it to Milton Keynes. This has increased collaboration with the London HQ, and the bank is reaping the rewards. Nevertheless, this affected a large number of employees.
Bateman says: “Unfortunately, one of the challenges you have when overseeing a business is making those tough decisions.”
His response, as with everything, is not to dwell on the past, but to examine, assess, fix and iterate.
“Something I learned very early on in my career, is that you should treat people with respect when they arrive at the organisation, and when they leave,” Bateman continues. “Ensure that those that do leave, do so with their heads held high.”
He explains that, while the specialist finance market has grown considerably, it is still a relatively small, close-knit community. While competitive, this market thrives because “there are lots of specialist lenders out there offering great solutions and great services.”
“We are all ultimately trying to do the same thing, which is offer borrowers solutions,” he adds.
That value of having a diverse set of lenders catering for these borrowers’ needs means that Recognise Bank, for all its aspirations of growth, has no ambition to become a 500 or 600 person behemoth.
“We don’t believe that we need to massively increase the number of staff in order to increase our efficiency and ability to lend,” Bateman explains.
Instead, he sees 150 to 200 staff, enabled by carefully curated technology and AI, as well as well-planned processes and decision-making structures, as the sweet spot for the business.
Achieving growth in this way, he adds, comes down to “the attitude of the executive team.”
“We’ll hold each other accountable to ensure that we remain proportionate in terms of the governance and control frameworks,” Bateman explains. “We don’t want to end up bogging ourselves down in red tape and governance, which then stops our ability to react to the market – or to go out and look at a product or an M&A opportunity.”
Recognise now faces a new cultural challenge. Some people thrive in startups, others prefer an established business, and transferring between the two stages can call for a different mindset. Bateman knows he may lose good people as a result, but as much as possible, wants to convince them that this next growth stage is worth staying for.
“That comes down to communication, clarity of message, and clarity of strategy,” he says.
With that in mind, Bateman looks ahead to the next three to five years with optimism. While the environment may remain volatile and hard to predict, those with the right processes in place will be able to push through.
Products and processes are not enough alone, however. Awareness is key. With all the hard work being done by specialist lenders to provide innovative solutions, these are only as good as the perception of the market.
Bateman explains: “The last thing any of us want is for the growth in the UK, especially in the specialist lending and development space, to dry up because there is a perception that there isn’t any funding out there.
“The MFS collapse is a prime example: borrowers didn’t know how their funding was going to be managed when that happened. It is key that borrowers know there is a market of stable specialist lenders out there that can support them, despite the press speculation implying that there isn’t.”
“As long as the company maintains its flexibility to react, it will be successful,” he concludes.
“Those companies that are unable to do the horizon scanning, looking at what’s coming forward from a political and a geopolitical scenario, will fail. There’s no two ways about it.
“You’ve got to accept that we’re in a very changing, very volatile market. Because of that, making sure that borrowers are aware that there are solutions out there is going to be critical.”
The most interesting measure of Recognise’s transformation may ultimately not be how large the bank becomes, then, but whether it can grow without becoming the “little big bank” that Bateman wants to avoid. The next phase will test the very model that delivered its turnaround, and will prove whether decisiveness, proportionality and borrower-led specialism can survive scale.
