# Charity Bank raises nearly £5 million in subordinated debt

- Link: https://fundraising.co.uk/2019/11/28/charity-bank-raises-nearly-5-million-in-subordinated-debt/
- Published: 2019-11-28T08:00:55+00:00
- Author: Melanie May

**Charity Bank has announced the successful raise of nearly £5 million in subordinated
debt as well as plans to attract an additional £10 million in new equity investment
from charities, trusts and foundations.**

This capital will enable [Charity Bank](https://charitybank.org) to grow its support
for the social sector and increase its capacity to respond to a growing demand for
repayable finance, including the significant unmet demand for unsecured funding.

Charity Bank has grown its loan book by an average of 28% over each of the past 
four years and is now seeking to secure further investment to meet its objective
of doubling its lending to charities and social enterprises by 2024 and extending
its offering to smaller organisations where the funding gap is most acute.

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As a regulated, deposit-taking bank, Charity Bank can leverage equity investment
to multiply its social impact: for every £1 of capital raised, Charity Bank can 
raise about £7 in deposits from retail savers and therefore lend approximately £
8 to organisations delivering positive social change.

78% of Charity Bank borrowers that took part in its recent social impact study say
their project would not have gone ahead without the funding, and 30% said it helped
keep their organisation afloat.

Ed Siegel, Chief Executive, Charity Bank, said:

> “We believe that the current expansion of our investor base represents a potentially
> very powerful opportunity for many charities, trusts and foundations looking to
> use social investment as one means to achieve their social objectives. We will
> leverage every pound of the investment we raise to make around £8 of loans to 
> help charities and social enterprises fulfil their missions and tackle some of
> the most challenging issues facing UK society today.
> “Further equity investment will help Charity Bank become an enduring institution
> that can continue responding to the needs of the sector and allow more savers 
> to put their money to work for the benefit of society. Having recently made our
> 1000th loan, we’re now in a strong position to move into the next stage of our
> growth journey, supported by £10m in new equity investment and the recent successful
> raising of almost £5 million in subordinated debt.”

The subordinated debt initiative – which benefitted from specialist advice and capital
raising support from ClearlySo and Allia C&C as well as the impact wealth manager
Tribe Impact Capital – successfully attracted nearly £5m in long-term capital, raised
almost exclusively from eligible individual investors that will benefit from the
Community Investment Tax Relief (CITR) that is attached to the offering.

 * **[Charity Bank secures £500k new investment as it seeks to double lending](https://fundraising.co.uk/2020/01/14/charity-bank-secures-500k-new-investment-as-it-seeks-to-double-lending/)**(
   14 January 2020)
 * **[Charity Bank saw record lending & surplus in 2021](https://fundraising.co.uk/2022/06/09/charity-bank-saw-record-lending-surplus-in-2021/)**(
   9 June 2022)
 * **[Charity Bank receives £2.75mn investment to expand reach](https://fundraising.co.uk/2023/07/07/charity-bank-receives-2-75mn-investment-to-expand-reach/)**(
   7 July 2023)

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