Standard Chartered Bank (StanChart) and FairPrice Group-backed Trust Bank had posted promising leading indicators that signal strong business growth, setting the stage for profitability, according to CEO Dwaipayan Sadhu. “We are on track to becoming Singapore’s fourth largest retail bank by customer numbers by the end of this year,” he adds.
At the sidelines of the bank’s second-anniversary business update event, Sadhu says Trust’s 1HFY2024 total revenue had increased three times compared to 1HFY2023. The revenue increase came from flat costs, only up 1% y-o-y owing to its technology-backed scalability.
As for customer acquisition costs, Trust’s integration with its ecosystem partners allowed the bank to attract clients organically, especially at the initial stages. Additionally, about 70% of all sign-ups come from existing customer referrals, which is the cheapest way to acquire customers. As such, Sadhu explains that Trust’s acquisition cost is just one-seventh of the market average.
Other key business metrics include its customer growth, which reached 800,000 in 1HFY2024 ended June. Customer deposits reached $3 billion, 2.6 times higher than those recorded in 1HFY2023 ($1.2 billion). Total customer loans and advances grew 3.1 times y-o-y, with total balances at $486 million compared to $157 million in 1HFY2023.
Trust posted a loss of $128.4 million for FY2023, widening by 3% y-o-y. Net interest income was $32.4 million, growing from the $4.9 million reported in FY2022. The bank’s net fee and commission income in FY2023 was $6.8 million, growing from the expense of $1.9 million in the preceding year. Income before operating expenses was $39.1 million compared to $3 million in FY2022. Its accumulated loss (a balance sheet item) expanded to $361.6 million as of Dec 31, 2023.
In FY2023, Trust’s customer deposit balance reached $1.86 billion, with customer loans and credit card balances exceeding $300 million.
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While its digital bank peers may be pressured to meet a minimum paid-up capital of $1.5 billion within three to five years from the commencement of business, Sadhu clarifies that Trust does not have the same obligation the bank has a full bank license which it received as a result of StanChart’s enhanced Significantly Rooted Foreign Bank (SRFB) status. As of Dec 31, 2023, Trust’s shareholders funds had fallen to $168 million, down 10% y-o-y.
In conjunction with its second anniversary, Trust has launched a cash-back card, which provides a quarterly bonus rate of up to 15% on customers’ preferred spending category. New Trust customers get unlimited 1.5% cashback on all other spending with no caps until Dec 31, 2024, while existing customers get 1%.
Trust’s full suite of products includes a savings account, Link credit card, instant loan, and insurance, among others.
