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."
