Market News

 February 08, 2012
Triodos ramps up green lending 36 per cent

 Triodos will today report that its lending to sustainable organisations in the UK soared 36 per cent during 2011, taking the specialist green bank's loan book to £424m.

The company's UK loan book increased by £113m, despite an economic climate that has seen many banks scale back lending activity, while its overall lending and commitments now total £625m.

The largest volume growth areas last year were renewable energy, up about 25 per cent, and social housing, which increased 240 per cent.

Dr Bevis Watts, head of business banking at Triodos, said the company was already two years ahead of its previous business plan targets and predicted growth could go above 20 per cent this coming year as the global green economy continues to expand.

"I can't imagine there is another bank that grew its lending 36 per cent and I really don't think there is another bank that did this lending entirely to [this sector]," he told BusinessGreen. "What's really positive about these figures is that in a recession there is still continued growth in renewables, in recycling and composting... and energy efficiency. There's a new economy to be built here."

Triodos, headquartered in Holland, only lends to businesses and charities delivering social and environmental benefits, concentrating on the organic food and farming, renewable energy, social housing, and fair trade sectors.

Last year it launched a £15m share issue to increase its investment in onshore wind, with the aim of supporting 100MW of capacity by 2015. Bevis said Triodos would continue to "raise capital on an ongoing basis", but highlighted deposits, which grew by about 10 per cent, as an area to improve.

"We would anticipate that our UK deposits grew faster than the market norm, but they didn't grow at the rate our lending did," he said, adding that lending could increase further if savers considered how their savings might perform if they were invested in a more sustainable way.

Beneficiaries of Triodos' lending included Tablehurst Farm, an organic community farming cooperative in East Sussex that used loan finance to install a solar PV system, and Utility Aid, social enterprise in Lincolnshire that helps charities save money on energy..

In a separate statement, Watts added that the bank's success demonstrated the commerical viability of taking a more environmentally sustainable approach to banking, arguing that it provided "an indication that a sustainable and socially conscious approach can help businesses and charities to flourish, bucking the trends of the wider market".