CAF Bank doubled its lending last year

According to its accounts for the year to 30 April 2016, it lent £45.6m; in the previous year the figure was £20.2m

Charities Aid Foundation headquarters
Charities Aid Foundation headquarters

CAF Bank, the Charities Aid Foundation-owned bank that focuses primarily on the charity sector, more than doubled its lending in 2015/16, its latest accounts show.

The accounts, which cover the year to 30 April 2016, show the bank lent £45.6m, compared with £20.2m in the previous year.

The accounts say that lending was primarily to charities and other "social-purpose organisations". There were also a small number of short-term development loans to personal customers, which the accounts say allowed the bank to "cross-subsidise and maintain free banking for many smaller charities".

The increase in lending meant that CAF, which is the immediate parent and controlling party of CAF Bank, received £3.3m in donated surplus from CAF Bank in the year covered by the accounts.

A spokesman for CAF said the bank’s services had become increasingly popular among charities, which accounted for the increase in lending.

There was a £3.6m profit before taxation in 2015/16, a £1.5m increase on the previous year, the accounts show.

According to the accounts, the bank agreed 62 drawn loans and 27 sanctioned loans to charities, amounting to £38m and £24m respectively. A further five loans worth £5m in total have been committed and are expected to draw in 2016/17, the accounts say.

Peter Ostacchini, chief executive of CAF Bank, said: "CAF Bank’s lending grew significantly during 2015/16 and continues to grow, driven by demand from charities for funds to enable them to deliver their missions.

"This has been a real success story for CAF Bank and the wider sector, with charities up and down the country benefiting from being able to take out loans with a bank which is owned by a charity and that exists to support them."

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