NatWest provided financing of up to £250 million to Castor Financing, a special-purpose vehicle that purchased loans originated and serviced by Amplifi Capital before the consumer lender entered insolvency in June 2026. Amplifi reported £119 million of assets in its latest accounts, but the amount NatWest may still be owed by Amplifi or related businesses has not been established.
Amplifi began in 2013 as a small lender serving credit unions and moved into unsecured consumer credit in 2022 through its Reevo brand. Reevo offered personal loans carrying interest rates between 23% and 50%, placing the company in a segment where credit quality, funding costs and consumer-protection rules can quickly alter portfolio economics.
The funding structure expanded with the business. Amplifi announced a £100 million securitisation warehouse with NatWest in September 2023 and sold loans to Castor, which issued notes backed by those receivables. In March 2025, Castor's Class A facility was increased to £250 million with NatWest identified as the noteholder; M&G funds also held up to £56 million of Class B notes.
The attraction for banks lies partly in capital treatment. Funding a non-bank through securitisation can require a 20% capital charge, compared with 100% for a direct loan to the non-bank's customers. Industry analysis has estimated that the structure can triple return on equity, explaining why regulated banks have expanded financing to lenders that operate outside the traditional deposit-taking system.
That efficiency also separates the bank from the final borrowers and can make losses harder to see before a default. NatWest's overall business-loan book totals about £160 billion, so the Castor facility is not large relative to the group, but the available filings do not reveal the bank's current outstanding balance, collateral recovery or expected impairment.
Amplifi's own accounts had already weakened. It moved from a £5.5 million profit to a £100,000 loss in the year ended March 2024, struggled to adjust after new UK consumer-credit rules took effect in July 2023 and became overly dependent on a deteriorating credit-union business. M&G deferred interest payments while Amplifi sought a viable path, indicating that creditors were supporting the company before insolvency.
The case follows the collapse of UK mortgage originator Market Financial Solutions, which owed £1.8 billion and left banks including Barclays and HSBC exposed to losses. European banks' assets linked to non-bank finance firms reached 11% by the end of 2025, up from roughly 6% a decade earlier. Regulators have not characterised the whole market as systemically impaired, but they have identified vulnerable pockets and limited visibility.
The next information must come from the insolvency process and bank disclosures: the amount recoverable from Castor's loan pool, the ranking and losses of Class A and Class B noteholders, and any NatWest impairment. The broader regulatory question is whether capital relief for securitisation is matched by enough transparency about the credit risk that remains inside the banking system.
