Finance News: Unity Trust pledges half its loans to sector

Mathew Little

Half of Unity Trust Bank's future lending will be to voluntary organisations, it announced last week.

The bank issued loans worth £5.5m to charities and community development finance institutions during 2003.

Voluntary sector deposits also grew from 40 per cent of the total in 2002 to 43 per cent last year.

Unity Trust has traditionally focused on trade unions as well as charities.

It is 73 per cent owned by the trade-union movement.

But a further expansion of the bank's financial involvement in the voluntary sector is anticipated because of its membership of the Futurebuilders consortium, which launches this week.

The £125m fund to increase voluntary sector public service delivery will comprise a mixture of both grants and loans.

Unity Trust's managing director Ian Sim said: "Our business strategy is that around 50 per cent of new lending will be to the voluntary sector, and our involvement in Futurebuilders is consistent with this focus."

Overall, the bank announced an 11 per cent rise in lending in 2003, to £45.9m.

It reported pre-tax profit of £4.1m, which has doubled over the past five years. The final dividend to shareholders increased by 20 per cent.

"Our strategy is focused on banking services for trade unions and the social economy, which presents a significant market as it grows in importance," said Sim.

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