British-based Aldermore bank increased the funding being provided to small and medium-sized enterprises (SMEs) by 21% in Q2, to £302m.
“It is a great result and we really seem to be building a lot of momentum,” says Phillip Monks, Aldermore CEO. “It is an especially strong performance as we have been careful to ensure that we are lending only to credit worthy and robust SMEs.”
In the same period, the bank also increased deposits from savers by 12% to £304m.
The bank, which opened for business in July 2009, has aimed its lending business at companies unable to get financing from the large established high street banks – which control 85% of the small business market.
Lending to UK businesses has dropped during the crisis, with many companies facing problems accessing liquidity. According to data from the Bank of England, business lending fell for the fifth month in a row in July.
Mr Monks says that the bank is already expanding its services to the sector. “There is huge pent up demand from SMEs for funding to help them expand.”
The bank, which is backed by AnaCap Financial Partners and Morgan Stanley Alternative Investment Partners and has eight offices across the UK, lent more than £300m to SMEs in its first 12 months.
Aldermore is not the only bank following this model. British Enterprise Bank is backed by a consortium of City financiers and is expected to commence operations early next year. It also plans to lend exclusively to SMEs using deposits on retail savings products.
