UP to 400 jobs will be created when the world’s first “telepathic” bank opens its UK headquarters in the North-East next year.

Trailblazing online bank Atom, which will offer an alternative to traditional high street lenders, has chosen to set up on the outskirts of Durham City.

In the coming months, Atom’s staff will move into its temporary home at Northumbria House at Aykley Heads, currently occupied by Durham County Council.

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Over the next two years, Atom will seek approval to build new offices on a five acre site beside the nearby Rivergreen Centre where it will employ more than 400 people by the end of the decade.

Bank bosses scouted five locations across the region before choosing Durham to launch Atom which will bring competition to an industry tainted by scandals over executive bonuses, payment protection mis-selling and rate-fixing.

The bank will operate no high street branches, but it hopes to attract customers online by offering high quality service and innovations that are set to revolutionise the banking industry, such as paperless cheque deposits. Instead of taking a cheque to a cashier for example, customers will be able to email a picture of the cheque to be deposited into their account.

Atom is headed by banking pioneer Anthony Thomson, the founder and former chairman of Metro Bank, and Mark Mullen, who was chief executive of First Direct.

“This area has a well educated and skilled workforce-because of the problems of Northern Rock a lot of great people with the skills we need are available,” said Mr Thomson, who added that Durham's rail links, pleasant location and world class university were factors behind the move.

“Our mission is to change banking for good. The aim is to become the first ever telepathic bank. With predictive technology we think we will know what it is that you need,” he said.

Mr Thomson told The Northern Echo that the bank would not just issue statements listing the previous month’s transactions, but it would also send a statement for the month ahead, predicting a customer’s spending based on their past behaviour.

“We could say that we think you will become overdrawn on the 20th of the month, so here is a pre-approved facility which you may wish to use. We will do things differently and better,” Mr Thomson added.

The bank will employ about 160 people in Durham when it starts next year, and by the end of the decade more than 400. As well as clerical and banking roles there will also be an innovations team on the site to develop new products and technology.

Mr Thomson declined to set a date for Atom’s launch although it is expected to be sometime next summer.

Councillor Simon Henig, leader of Durham County Council, said: “This is a very significant step in the development of what is a key site in the County Durham Plan; a site which we believe has the potential to be a powerful economic driver for the county and wider region.

“Alongside the creation of hundreds of jobs this sends a very strong message that Durham is a forward thinking, business-minded county ready and waiting to do what it takes to help companies deliver on their ambitions.”