Spanish bank BBVA may be preparing to add the UK's Atom Bank to its burgeoning portfolio of 100%-owned neo-banking startups.
Sky News has learnt that Atom Bank is in talks to appoint Citi to advise its board on options for the business.
In June last year, BBVA completed an £85.4m investment into Atom, increasing its stake in UK mobile bank to 39%.
Under the terms of its shareholder agreement, BBVA has an option to acquire the remainder of the shares.
Sources close to Atom, cited by Sky News, denied that hiring Citi represented a "sale mandate" although they conceded that either a takeover, further equity fundraising or stock market listing was likely during 2019.
BBVA has been investing heavily in digital-only banking startups, including Simple in the US, German-based solarisBank, Finland's Holvi, Neon in Brazil and the inhouse incubated Denizen.
Launched in 2016, Atom has secured £1.3 billion in deposits for its market-beating savings account and lent over £1.2 billion through residential mortgages and business loans. Unlike other mainstream challenger banks, Atom has so far shied away from the current account market, citing regulatory pressures.