In a significant move to enhance support for the UK’s small and medium-sized enterprises (SMEs), Atom Bank has announced an increase in the maximum loan-to-value (LTV) ratio for commercial mortgages up to £5 million. This strategic decision raises the LTV cap from previous limits to a new high of 75%, paving the way for more robust financial backing for business growth and development.

Previously capped at lower percentages, the LTV increase to 75% on mortgages as large as £5 million is a game-changer for many businesses. This adjustment by Atom Bank is expected to affect a substantial number of the bank’s applicants, broadening access to more substantial funds for larger investments and projects.

Tom Renwick, the head of business lending at Atom Bank, explained the motivations behind this pivotal change. “Atom Bank enjoys a strong relationship with intermediaries, and we use their feedback wherever possible to improve our proposition,” he noted. Renwick noted that discussions with brokers revealed a distinct market need for higher LTV lending on larger mortgages, prompting the bank to respond proactively.

“These changes demonstrate how serious Atom bank is about supporting the UK’s SMEs with their borrowing needs,” Renwick added. He highlighted that the new LTV cap will allow the bank to collaborate with a broader spectrum of businesses, thereby aiding them in achieving their growth objectives.

Enhancements in Broker Interaction and Underwriting Processes

Renwick also pointed out significant improvements made to Atom Bank’s commercial broker portal and the underwriting process. These upgrades were largely driven by broker feedback, showcasing the bank’s commitment to streamlining operations and enhancing service delivery. As a result, Atom Bank now boasts the capability to issue a loan offer within an average of just 14 working days.

Expanded Access to Recovery Loan Scheme (RLS)

In addition to lifting the LTV ratio, Atom Bank has also revised its policy on the Recovery Loan Scheme (RLS). For most borrowers seeking an RLS facility, the bank now supports lending up to the scheme’s maximum loan size of £2 million for LTVs of up to 75%. This update will significantly aid those in recovery phases or needing substantial funding boosts under the scheme’s guidelines.