Economy
Charity Bank drops charity status and sets sight on sustainable growth
One of the UK ethical banking sector’s biggest names, Charity Bank, is to drop its status as a registered charity in an effort to boost its lending to the charitable and social sectors.
The shake-up comes after new banking regulations made it difficult for the organisation to operate as an FSA-regulated bank, while also running as a charity.
The bank, whose chairman George Blunden spoke about its success in Blue & Green Tomorrow’s Guide to Sustainable Banking 2012, says that increasingly tight grant budgets were likely to have prevented significant future growth.
But by dropping its charity status, it is able to set itself an ambitious target of growing its balance sheet by 168% in the next five years – from £93m now to £250m in 2018.
“We were set up to address market failure, and we think this is the route that will enable us to make a bigger impact on the sector”, Charity Bank chief executive Patrick Crawford told Blue & Green Tomorrow.
“We won’t change our mission; we won’t change our key structure; we won’t change our organisation; we won’t change how we do what we do.
“It will simply enable us to go to social investors for capital instead of our current dependence on grants and donations from within the sector, at a time when there are a lot of pressures on grant-makers.”
Crawford added that Charity Bank customers won’t notice any different in their day-to-day banking needs.
“What borrowers will see is actually an ability to make bigger loans and to make more of them”, he said.
“They will be the beneficiaries of what will be a rather larger bank with more firepower to lend to the sector.
“We will remain a mission-driven and impact-focused bank and our ability to grow means that we will achieve financial sustainability. We haven’t achieved this because of our relatively small size, but it is in the interests of the sector.”
Charity Bank celebrated its 10th birthday during National Ethical Investment Week last year, after having been launched by then-chancellor of the exchequer Gordon Brown at Downing Street in 2002.
At the point when its 2011 Annual Review was published in May 2012, it had issued 1,006 loans, valued at a total of £165m and supporting project expenditure of £353m. This, in turn, was estimated to have improved the lives of some 3.5 million people across the UK.
Further reading:
Charity Bank celebrates 10 years at the forefront of ethical banking
Sustainable banks more ‘robust and resilient’ than high street institutions
Interest in ethical options surges amid UK banking melee
- Business11 months ago
How to Become an Environmentally Conscious Entrepreneur in 2024
- Features4 months ago
3 Ways an Outdoor Kitchen Can Make Your Home Eco-Friendly
- Features12 months ago
What Eco-Friendly Investors Should Know About Trading Silver
- Invest11 months ago
Should Eco-Friendly Investors Support Biotechnology Companies?