Vince Cable launches British Business Bank Strategic Plan
The Secretary of State for Business, Innovation and Skills, Vince Cable, today provided an update to Parliament on the progress and future plans of the British Business Bank with a Written Ministerial Statement. The statement launched the British Business Bank’s Strategic Plan and new Business Finance Guide.
The full text of the statement is included below:
I would like to update the House on the British Business Bank.
The British Business Bank is already achieving significant results as over 30,000 businesses are benefitting from its programmes. Last year, £782m of new lending and investment in UK small firms was generated by Business Bank programmes – this is double the level of activity generated by Government finance programmes to small business in 2012/13.
The British Business Bank has also played an important role in promoting a wider range of finance options. 61% of its activity is channelled through smaller investors and lenders, with only 39% of support going through the big four banks. Over the coming years, I expect that this bias away from the big banks will continue.
Examples of the innovative investments over the last year include: £7.8m committed to the Dawn Capital II venture capital fund; £25m to the Episode 1 Venture Capital fund; £30m committed to Praesidian Capital Europe debt fund; £15m in BMS finance, £40m invested through Funding Circle and £20 in the Sussex Place Venture capital fund. In all this cases, the British Business Bank’s investments of public money have been made alongside private sector investors, so crowding in new finance for small business in the UK
In addition to this, the British Business Bank also funds the Start-Up Loans programme, which has lent £70 million to new entrepreneurs in the UK. The Bank has increased utilisation of the Enterprise Finance Guarantee to £348m (up by 21% year on year). This programme helps firms with good cashflow but low levels of collateral to obtain bank finance.
Today I am publishing the new Strategic Plan for the British Business Bank which sets out our ambitious plans for further increasing the impact of the institution. The full board of the British Business Bank is now in place, as are the majority of the staff and senior management team, operating out of the headquarters in Sheffield as well as, temporarily, the BIS office in London. The next stage will be to complete state aid negotiations with the European Commission later this year. At this point, responsibility for the assets and staff currently of the Bank will transfer fully to the new corporate structures we have put in place
I would also like to inform the house of the publication today of a new Business Finance Guide aimed at making smaller businesses aware of the options for finance available across the market produced by the British Business Bank and the ICAEW. It has been produced in association with trade bodies representing all the major sources of funding – as well as the main business representative bodies. I will be launching the guide in Committee Room 10 at 11.00 today as part of a session on access to finance.
I am making copies of the Strategic Plan and the new Business Finance Guide available in the vote office. The Strategic Plan for the British Business Bank can be found on GOV.UK and the British Business Bank website.