British Business Investments – Full year results for the period ending 31 March 2018
British Business Investments, a wholly-owned commercial subsidiary of British Business Bank plc, the UK’s national economic development bank, today publishes its Annual Reports and Accounts for 2017/18, its fourth year of operation.
Key highlights for 2017-18 include:
• A gross annual income of £76.2m generated, delivering a pre-tax profit of £67.9m – an increase of 23% on 2016/17
• A gross return on average capital employed for the year of 7.0%, or 6.2% net of costs, both ahead of benchmarks of 5.6% and 5.0% respectively
• Supporting nearly 27,000 business across the UK as at 31 March 2018, an increase of 51% on 31 March 2017
• British Business Investments currently has £1.2bn invested, alongside £9.1bn of private sector capital, across 58 investment partners
In the last financial year, British Business Investments has delivered strongly against all four of its objectives, as set by its sole-shareholder, British Business Bank plc:
1. Support financial innovation and diversity – we supported the development of diverse debt and equity finance markets by increasing our number of investment partners from 38 in 2017 (as at 31 March 2017) to 58 in 2018 (as at 31 March 2018), particularly through and Venture and Growth Capital.
2. Promote a greater supply of finance to the market – through new and existing investment partners, we’re increasing the supply of capital, with total commitments of £2.1bn (as at 31 March 2018), an increase of 31% on 2016/2017.
3. Increase financing options for UK SMEs – in addition to our invested capital of £1.2bn, third parties have invested a further £9.1bn alongside, resulting in a total funding of £10.3bn across the market. This is an increase of 43% (from £7.2bn) since 31 March 2017, invested in 26,706 businesses.
4. Delivering a commercial return to our shareholder in excess of our benchmark returns – British Business Investments delivered a 7% gross return on capital invested, 1.4% higher than its benchmark.
British Business Investments invests in challenger banks, non-bank lenders and venture and growth capital funds to increase the choice of finance for smaller and medium sized businesses. It generates an attractive commercial return on investment for the UK taxpayer while having an economic impact by increasing the supply of capital available for small and medium sized businesses.
Catherine Lewis La Torre, CEO of British Business Investments, said: “Our latest investments have enabled us to increase the supply of capital to a broad range of small and medium-sized businesses, recognising their importance to the success of the UK economy.
“In the 2017/2018 financial year we have again produced tangible results, and I look forward to building on this success further as we address the challenges and opportunities of the year ahead.”
Keith Morgan, Chair of British Business Investments, said: “We are pleased to report a strong set of results for the 2017/2018 financial year, a broadening of British Business Investments’ remit, an increase in profits, and an expansion of our network of finance partners.
“As a wholly-owned subsidiary of the British Business Bank, British Business Investments plays a key role in helping achieve the group’s overall objectives – increasing the size and diversity of finance markets and producing positive returns on UK taxpayers’ investments.”
British Business Investments
For more information, please contact:
Scott Shearer, British Business Bank, Scott.Shearer@british-business-bank.co.uk
Notes to Editors
About British Business Investments
British Business Investments is the trading name of British Business Investments Ltd, a wholly-owned commercial subsidiary of British Business Bank plc, the UK government’s economic development bank. It forms part of the British Business Bank’s commercial arm.
British Business Investments aims to earn a commercial return by investing – through finance providers – in smaller businesses and small mid-caps, pursuing investments on a fully commercial basis without receiving any economic advantage from the government. Find out more at bbinv.co.uk.
British Business Bank plc and its subsidiary entities are not banking institutions and do not operate as such. Neither British Business Bank nor its principal operating subsidiaries are authorised or regulated by the Prudential Regulation Authority (PRA) or the Financial Conduct Authority (FCA). A complete legal structure chart for British Business Bank plc and its subsidiaries can be found on the British Business Bank plc website.
From FY 2018-19 the British Business Bank group, including its subsidiaries, will no longer report against its delivery of finance to mid-cap businesses as a key performance indicator. There is a full explanation of the rationale for this change in the British Business Bank plc Annual Report (p6).