Charity Bank

Jaishree MistryLending Manager, London & South

What is Charity Bank?

• A Bank that is also a Charity

• Our mission is to transform the future of charities and social businesses

How we achieve our mission

• We provide affordable loan finance to charitable organisations that might not be able to borrow elsewhere

• Our work is funded by individuals and organisations that use their savings as a positive source for change.

• Every pound deposited is used to provide loans to charities, social enterprises and voluntary organisations.

Charity Bank’s impact to date

• £80+ million the amount of money that has been placed with or invested in Charity Bank.

• £165,000,000+ the amount committed to charities, churches, and social enterprises to date.

• 3,000,000 the number of people in the UK that have been reached by organizations that Charity Bank has supported

• £160 million of additional funding has been unlocked as a result of our funding.

Charity Bank loan finance

• £50,000 to £1,000,000• 6 months to 25 years• Secured or unsecured• Secured on property or other assets:

maximum 70% loan to value• Rate typically 6.5% secured and 7.5%

unsecured• Arrangement fee 1%• No early repayment penalties unless…

In need of finance?

• Buying a building• Covering payments in arrears• Buying equipment• Funding staff posts• Building up reserves• Starting new projects• Plugging a funding gap• Refurbishing premises

Benefits of loan finance

• Enables a project to be delivered NOW• Can avoid potential increases in costs• Lending against pledges/retrospective

grants• Independence

Assessing loan applications

• Nature of the projectNature of the project• Who benefitsWho benefits• Ability to service borrowingAbility to service borrowing• Quality of the applicant/key Quality of the applicant/key

staff/governancestaff/governance• Credit CommitteeCredit Committee

Key information

• Background information on the

Trustees and Management team

• Business Plan – 3 years forward

• Risk Analysis, including contingency planning

• Past 3 years annual accounts & annual reports

• Financial projections

• Bank statements

Financial analysis

• Mix of income streams, and, robustness• Reliance on grants (%)• Reliance on service contracts (%)• Sensitivities• Regular surpluses generated?• Fixed v Variable costs• Management/Staff costs Reserves - (Policy? ...Restricted/Unrestricted funds (%))• Fixed Assets – easily realisable? • Who are the creditors?• How long does the organisation take to pay its creditors?• Who are its debtors?• How long does the organisation take to pay its debts?

Financial history and financial forecasting

Risk analysis and mitigation

Confidence in your people

Ability to repay/

Income generation

plans

Points to be aware of

• Pre-drawdown conditions• On-going Trustee guarantees• Financial covenants• On-going information requirements• Events of default• Early repayment penalties

Further information

Jaishree MistryLending Manager, London & South

07789 715212

jmistry@charitybank.org

www.charitybank.org