Triodos Bank in the UK

Like many businesses, we faced the everyday operational challenges of the Covid-19 pandemic in 2021. We focused on supporting our customers and caring for our co-workers through unusual and challenging times. The UK economy did eventually grow to above its pre-pandemic level in November, only for the arrival of Omicron to reverse this trend with a surge in Covid-19 infections and self-isolations.

Meanwhile, hosting the G7 summit in Cornwall and COP26 in Glasgow put the UK centre stage on the ‘build back better’ agenda. Discussions around addressing environmental and social challenges – including the role of the finance sector – were front of mind for many. In this context, Triodos has become an even more important part of the banking landscape and a reference point by continuing to challenge the way banking is done.

Triodos Bank UK Ltd overall customer numbers grew by more than 16% to 85,000 (2020: 73,000). We offer personal current accounts, savings, investments, business lending, corporate finance advisory, crowdfunding and more, all with the intention of putting money to work delivering positive impact – changing lives, protecting the environment and building stronger communities. Now firmly established in the mainstream UK banking landscape after 25 years, we were recognised as ‘Best Sustainable Bank – UK’ by the Responsible Banking Awards and nominated in four categories at the British Bank Awards, including ‘Best Current Account Provider’, ‘Best British Bank’ and ‘Best Ethical Financial Provider’.

Our flagship personal current account continues to be rated the most ethical personal current account in the UK. Customers join us because they are committed to the Triodos mission and values, and not for a quick financial incentive to switch. Further endorsements as the UK’s top sustainable bank also came from Which? who released its first ranking of sustainable savings account providers.

Overall customer deposits increased to GBP 1,608 million (2020: GBP 1,413 million). Triodos Bank UK maintains strong capital with a Common Equity Tier 1 ratio of 21.8%. With a clear focus on making money work for positive social, environmental and cultural change in the real economy, we have a strong model for what successful sustainable banking looks like. Strong liquidity and capital position gives a strong base for continued growth.

Focus on positive impact

Our primary focus remains on the impact we deliver with our customers’ money and investments. The total UK loan book grew to GBP 1,132 million (2020: GBP 1,070 million), an increase of 5.8% on 2020. It was a strong year of gross new lending, mostly to small- or medium-sized organisations. Some of the highlights in the year included financing the UK’s largest community-owned and first ‘subsidy free’ solar park with Low Carbon Hub near Oxford and supporting the online platform Love to Ride, aiming to encourage more people to cycle.

Triodos UK continues to finance a large number of social organisations to help them extend their impact, including those providing special education such as Ruskin Mill or Birthenshaw Group, and care home providers like Parklands in Scotland.

As part of our response to the pandemic, we continued our support toCommunity Development Finance Institutions (CDFIs), helping them grow their lending to small grassroots businesses in economically disadvantaged areas. Joining the UK government’s Recovery Loan Scheme as an accredited lender also helped the bank to further support our customers.

Investing for good

Retail customers’ awareness of impact investing continued to grow and we saw a substantial increase in the stock market and bonds funds we sell, managed by Triodos Investment Management. Impact investment fund sales were approximately GBP 76.4 million (2020: GBP 34.3 million) – an increase of 123% on the previous year. Details of the companies in the funds have been added to our Know Where Your Money Goes online map. Alongside the disclosure of who we lend to, this level of transparency is still one of the things that make Triodos Bank unique in the market.

Direct impact investment opportunities were made available to everyday investors on the Triodos crowdfunding platform (www.triodoscrowdfunding.co.uk). Approximately GBP 11 million was raised for a number of high-impact social enterprises and charities in 2021 such as Better Food, RHHL’s ground source heat pumps, the charity Paces Sheffield and B Corp Mama Bamboo.

National consumer polling found that COP26 motivated four in 10 people to want to use their money in a more sustainable way. Awareness continues to grow and attitudes to banking and money are changing – people are waking up to their choice in how it is used. There is a growing understanding of the power of money to be an influential form of democracy. This growing awareness, fuelled by powerful campaigns such as Make My Money Matter, helpfully puts pressure on the financial system to do better.

Changing Finance

With an external focus in the year of COP26, it was a critical time in terms of influencing the banking and finance sector more broadly. We attended a number of the events in Glasgow and announced our net zero target with an ambitious, science-based target of 2035, aligned to 1.5 degrees.

Our continued support for the Bankers for Net Zero initiative aims to find positive solutions for accelerating progress towards a net-zero world and gives us an opportunity to encourage the rest of the financial sector to consider environmental and social impacts in all of its decision-making.

Although the challenge is huge, the need to shift to a much more nature-based economy and invest in projects that absorb carbon offers much opportunity. Among the funding Triodos UK provided for organisations helping to make a positive impact on people and the planet this year, we were involved in arranging the finance for a ground-breaking Natural Flood Management project in Lancashire and raising £2m for Scottish rewilding charity Trees for Life on the crowdfunding platform in less than 48 hours.

Much of our Change Finance work is now detailed in a new area of our website here.

Looking to the future

In 2022, Triodos Bank UK will continue on a journey to become a more digital bank and make good use of technology to provide our customers with high quality service, offer more protection and create even more impact with the money they entrust us with. Technology will help us bring this impact to life, offering new ways to engage with our mission and bringing customers closer to the inspiring organisations we finance.

We will continue to not only finance change, but also strive for a banking world that is sustainable, transparent, and diverse. The bank has a bold ambition built upon fairness and compassion and we will work with energy and optimism towards a better future.

Bevis Watts
Chief Executive, Triodos Bank UK

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