Wise Young
05-01-2002, 06:48 AM
Source (http://news.ft.com/ft/gx.cgi/ftc?pagename=View&c=Article&cid=FT3GPK0ZN0D&live=true&useoverridetemplate=ZZZ99ZVV70C&tagid=ZZZPB7GUA0C&subheading=UK)
Not-for-profit bank responds to ethical trend
By Jane Croft
Published: April 30 2002 17:21 | Last Updated: April 30 2002 18:09
Britain's first not-for-profit financial services group is launched on Wednesday, while the the Co-operative Bank, famed for its ethical stance, announces it will not do business with companies involved in genetic modification or cloning.
The developments underline the extent to which banks are embracing the ethical and environmental concerns of investors.
The newly launched Charity Bank, set up by the Charities Aid Foundation, starts accepting deposits from investors in September and will use the funds to provide affordable loans to smaller charities.
Malcolm Hayday, chief executive of the new bank, believes the postal bank could soon build up a balance sheet of between £100m and £200m, with up to 3,000 savers.
"Our research has shown that people who are saving money for a rainy day are willing to forego a certain rate of interest if their money is working for the community," he said. "These days investors are more interested in how their money is being used."
Typical loans will be between £50,000 and £60,000 and might be to smaller charities or organisations such as pre-school playgroups who might find it difficult otherwise to gain access to finance.
The new bank is a registered charity and is also regulated as a bank by the Financial Services Authority, the City regulator. As a charity, the bank will re- invest all operating surpluses in the charity sector.
Initial capital funding for the Charity Bank of £5m will be provided by institutional and private donors as well as the Charities Aid Foundation, which helps donors maximise the tax efficiency of their charity donations.
The launch of the Charity Bank comes as the Co-operative Bank, which launched its ethical policy 10 years ago, announced on Wednesday that it had revised its policies to include several new issues.
The bank, part of the Co-operative Group, said that it would not do business with biotechnology companies involved in the uncontrolled release of genetically modified organisms into the environment. Nor would it deal with biotech companies involved in cloning - in particular of animals for non-medical purposes.
Co-operative Bank, which has 2m customers, said it had updated its policy after seeking the views of almost 100,000 of its customers.
The Manchester-based bank believes it makes extra pre-tax profits of £14m-£17m a year as a result of its environmental and ethical policies.
Not-for-profit bank responds to ethical trend
By Jane Croft
Published: April 30 2002 17:21 | Last Updated: April 30 2002 18:09
Britain's first not-for-profit financial services group is launched on Wednesday, while the the Co-operative Bank, famed for its ethical stance, announces it will not do business with companies involved in genetic modification or cloning.
The developments underline the extent to which banks are embracing the ethical and environmental concerns of investors.
The newly launched Charity Bank, set up by the Charities Aid Foundation, starts accepting deposits from investors in September and will use the funds to provide affordable loans to smaller charities.
Malcolm Hayday, chief executive of the new bank, believes the postal bank could soon build up a balance sheet of between £100m and £200m, with up to 3,000 savers.
"Our research has shown that people who are saving money for a rainy day are willing to forego a certain rate of interest if their money is working for the community," he said. "These days investors are more interested in how their money is being used."
Typical loans will be between £50,000 and £60,000 and might be to smaller charities or organisations such as pre-school playgroups who might find it difficult otherwise to gain access to finance.
The new bank is a registered charity and is also regulated as a bank by the Financial Services Authority, the City regulator. As a charity, the bank will re- invest all operating surpluses in the charity sector.
Initial capital funding for the Charity Bank of £5m will be provided by institutional and private donors as well as the Charities Aid Foundation, which helps donors maximise the tax efficiency of their charity donations.
The launch of the Charity Bank comes as the Co-operative Bank, which launched its ethical policy 10 years ago, announced on Wednesday that it had revised its policies to include several new issues.
The bank, part of the Co-operative Group, said that it would not do business with biotechnology companies involved in the uncontrolled release of genetically modified organisms into the environment. Nor would it deal with biotech companies involved in cloning - in particular of animals for non-medical purposes.
Co-operative Bank, which has 2m customers, said it had updated its policy after seeking the views of almost 100,000 of its customers.
The Manchester-based bank believes it makes extra pre-tax profits of £14m-£17m a year as a result of its environmental and ethical policies.