OakNorth reports nudge up in profits, delays net zero target by 10 years

OakNorth, the UK-based challenger bank backed by SoftBank, has posted a modest uptick in pre-tax profits for 2025, climbing from £215 million to £223 million year-on-year. The uptick was driven in large part by a significant surge in lending activity across the Atlantic, where the bank has been rapidly expanding its footprint since entering the US market in 2023.

But while the numbers look solid on paper, the bank’s announcement was overshadowed by a major environmental policy shift: OakNorth has pushed back its net-zero emissions target by a full decade, from 2035 to 2045. The bank cited several factors for the delay, including expansion into new geographic markets, evolving regulatory landscapes, and shifting sustainability commitments from its suppliers. In a statement, the company said the revised timeline would make its climate actions “more realistic and accountable.”

Originally set in 2022, the net-zero target had positioned OakNorth as a forward-thinking, sustainability-conscious lender. The decision to delay it could raise eyebrows among ESG-focused investors and stakeholders, especially at a time when many financial institutions are doubling down on green pledges.

Despite the environmental recalibration, OakNorth’s business model continues to thrive. The bank specializes in providing loans to small and medium-sized businesses in the “lower mid-market” segment, a niche often underserved by traditional high-street banks. In 2025, it extended £1.7 billion in new loan facilities, with half of that amount supporting commercial enterprises. In the US, new loan originations soared to $1.4 billion, a more than threefold increase from $400 million in 2024.

The US expansion appears to be paying off handsomely. In 2025, OakNorth made its first acquisition in the country—a Michigan-based bank that serves both retail and business customers—marking a significant step in its strategy to localize operations and deepen market penetration.

Rishi Khosla, co-founder and CEO of OakNorth, framed the growth as validation of the bank’s scalable model. “The fact that 40% of our originations now come from the US demonstrates that this model is transferable and competitive in one of the world’s largest lending markets,” he said. “With significant runway for growth across the UK and US, we’re primed to make our next decade even more impactful than our first.”

The valuation story adds another layer of intrigue. OakNorth was valued at approximately $2.8 billion during a funding round in 2019, and while it hasn’t gone public yet, its aggressive expansion—especially in the lucrative US market—could position it for a strong public market debut in the coming years.

However, the delayed net-zero target could complicate that narrative. In an era where both consumers and investors are increasingly attuned to corporate sustainability, any backpedaling on climate commitments can carry reputational risk. For OakNorth, the challenge will be balancing rapid commercial growth with credible environmental stewardship—a tightrope many fintechs and neobanks are learning to walk.

For now, the numbers are speaking loudly: OakNorth is growing, scaling, and making serious inroads abroad. Whether it can maintain that momentum while rebuilding trust on its sustainability front remains to be seen.

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