Funding Circle Holdings PLC: Strategic Share Repurchase and New Institutional Funding
Funding Circle Holdings PLC, the London‑listed platform that connects small and medium‑sized enterprises (SMEs) with investors, announced two significant developments on 12 February 2026 that underline its ongoing commitment to strengthening its balance sheet and shareholder value.
1. Share‑Buyback Execution
The company completed a purchase of 64,699 ordinary shares from Investec Bank plc, as part of the buy‑back programme announced on 15 May 2025. The transaction was executed on 12 February 2026 at a weighted average price of 153.5493 pence per share, with a price range that spanned from 148.00p to 158.00p. Upon closing, the company added these shares to its treasury holdings, bringing the total number of ordinary shares held in treasury to 3,797,901.
This buy‑back reflects Funding Circle’s confidence in its long‑term prospects and provides an immediate signal of value to investors. By reducing the outstanding share count, the company is likely to lift earnings per share and could potentially increase dividends in future fiscal periods, although no dividend policy change has been announced at this time.
2. £700 Million Partnership with Waterfall Asset Management
In a separate disclosure, Funding Circle confirmed a new partnership with Waterfall Asset Management and Citi that will inject £700 million of forward‑flow commitment over the next two years into the platform’s shorter‑term loan product. The deal also involves the purchase of an existing loan portfolio valued at approximately £120 million.
Key points of the arrangement:
| Component | Details |
|---|---|
| Forward‑flow commitment | £700 million over two years |
| Senior financing | Provided by Citi |
| Portfolio acquisition | ~£120 million in existing loans |
| Purpose | Transition from balance‑sheet to institutional funding, enabling Funding Circle to test new product propositions on its own balance sheet before scaling with institutional partners |
This transaction is a strategic move that aligns with Funding Circle’s broader strategy of developing innovative financial products internally, then leveraging external capital to scale successful models. The partnership with Waterfall, a long‑time collaborator, reaffirms the firm’s intention to deepen its institutional relationships while maintaining operational independence during the research and development phase.
Market Context
As of 10 February 2026, Funding Circle’s share price stood at 147.4 pence, trailing its 52‑week high of 176.8 pence set on 27 January 2026 but remaining comfortably above the 52‑week low of 87.1 pence recorded on 6 April 2025. The price‑earnings ratio of 64.93 indicates that investors are willing to pay a premium for the company’s growth prospects, despite the relatively high valuation in comparison to traditional banking peers.
The recent buy‑back and new funding agreement are likely to be viewed favorably by the market, as they both contribute to capital optimisation and provide a more robust platform for future lending initiatives across the UK, US, Germany, and the Netherlands.
Outlook
Funding Circle’s dual actions—returning capital to shareholders and securing significant institutional funding—position it to accelerate the launch of new loan products and potentially expand its geographic footprint. The company’s continued focus on aligning its balance‑sheet innovations with institutional capital should help it sustain growth while maintaining the flexibility to adapt to evolving market conditions in the SME lending space.
