1. A bank for good November 2016
17/11/2018 1
A bank for good
November 2016
“We’re a bank for people who don’t just dream of a better world, they are busy building one.”

2. Charity Bank: A bank for good
17/11/2018
Charity Bank: A bank for good
Run for charities and social enterprises and owned by charities and social purpose organisations
A savings and loans bank with a mission to use money for good
We lend to charities and social enterprises
Every single one of our shareholders is either a charitable trust, foundation or social purpose organisation
Our non-executive directors are unpaid and we do not operate a staff bonus scheme
We are the only bank in the UK with the Social Enterprise Mark
We were the first bank in Europe to become a B Corporation, an independently assessed certification for businesses that can meet rigorous social and environmental standards

3. Our mission is to support your mission
17/11/2018
Our mission is to support your mission
We exist to lend to charities and social enterprises, so you can be confident that we’ll work with you side-by-side
We exists to help social sector organisations access loans
We’ve lent over £200 million to charities and social enterprises
We take the time to meet and build relationships with our borrowers
100% of our borrowers would recommend us
We run and support programmes that help prepare charities and social enterprises for repayable finance

4. 17/11/2018
“We feel we have a partner working with us rather than a bank watching us”
- Charity Bank Borrower
Or as a borrower put it:
This is about more than just being friendly - this is about true friendship, companionship - it’s about going further than we need to.

5. 17/11/2018 1
Why Loans?

6. Why use loan finance ? To develop, purchase or refurbish a building
17/11/2018
Why use loan finance ?
To develop, purchase or refurbish a building
To form part of a match funding package
To bridge receipt of delayed funds
To obtain new contracts
To acquire equipment
To supplement grants and donations, which are not always sufficient
To achieve one, or any mix of the above goals

7. What are the benefits of borrowing:
17/11/2018
What are the benefits of borrowing:
Loans can allow projects to start more quickly, thus:
Providing services sooner
Generating income sooner
Avoiding potential increases in costs
Loans can be more flexible than grants
Loans can enable donation income to be directed where it is most needed
Loans can introduce business disciplines (effectiveness)
Loans may bring involvement/expertise from motivated investors

8. Should your charity borrow?
17/11/2018
Should your charity borrow?
Ask the lender for indicative terms early on
Do a cost/benefit analysis – be sure it is the best way
Are you confident you can afford the repayments?
Do sensitivity testing – “what if” analysis
Read the small print – can you comply with all of the terms?
Have you recognised all of the costs?

9. 17/11/2018
Are you ready to borrow?
Check your constitution – does it prohibit borrowing?
If not already a company – consider incorporating
Can you offer security?
Do you have ‘clean title’?
Do you have your title deeds?
Section 124(2)

10. 17/11/2018
Dealing with lenders
Make initial contact at the start of your project planning process
Consider a social lender or ethical bank – they may have a better understanding of the social sector and be more willing to lend
Don’t fear rejection – different banks have different criteria
Find out about timescales – it can take longer than you might expect!
If there seems to be a delay – contact your lender straightaway
Get someone independent to read the loan offer

11. Key terms – comparing loans
17/11/2018
Key terms – comparing loans
Interest – not just the rate but the type and term
Fees – check for additional costs
Security – what is required?
Commitment – when and why can the bank pull the plug?
Commitment – when do you become obligated?
Covenants – can you comply; are they overly onerous?
Trustee guarantees?
Early repayment penalties?
Requirement to change transactional account?

12. What lenders look for Evidence that you can afford the loan
17/11/2018
What lenders look for
Evidence that you can afford the loan
Good governance
Provision of financial information
Security
Risk assessment or register
Social impact

13. 17/11/2018
Emery Down Almshouses

14. 17/11/2018
YMCA Birmingham
“Charity Bank saw us as a partner in doing good, rather than just a customer from whom they could make money.”
Alan Fraser, chief executive, YMCA Birmingham

15. 17/11/2018
“They take the time to consider our plans and opinions and we never feel like a number”
As one borrower put it…
They take the time to consider our plans and opinions and we never feel like a number
- Charity Bank Borrower

16. 17/11/2018
Get in touch
Call:
Visit: charitybank.org
Follow: @charitybank