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Letchworth Bank hails ‘resilience of British business’ as first profit revealed

28/07/2022
An award-winning Hertfordshire bank has reaped the rewards of continuing to lend to British businesses throughout the pandemic by reporting its first profit.

When other lenders pressed pause on plans to support businesses in the wake of COVID-19, Redwood Bank, which has its headquarters in Letchworth, continued to invest in SMEs throughout the UK, helping the nation to rebuild the economy.

The specialist lender, renowned for having its finger on the pulse of business funding requirements, recorded a pre-tax operating profit of £2.2 million in the year to December 31, 2021 (2020: loss £1.7m), while its loan book increased by 14 per cent to £370m (2020: £324m) and deposits rose by 15 per cent to £438m (2020: £380m).

Gary Wilkinson, CEO and Co-Founder of Redwood Bank, said: “Where we are from is important to us, we are a part of the community. The fact that we made our first profit, in 2021, is testament to the robustness of our business model.  

“We reached this milestone because we continued to offer vital lending support to British businesses during the various COVID-19 lockdowns, when many other mainstream lenders retrenched. We are proud to have played our part in bolstering the resilience of British business.” 

The results illustrate the resilience of Redwood Bank’s business model at one of the most challenging times for UK businesses, with shareholders investing a further £9.9m of Tier 1 capital in the Bank during the year, increasing the total invested to £47.9m.

The Bank recently increased its maximum Loan to Value (LTV)s on mortgages up to 70 per cent for commercial loans and to 75 per cent for residential loans. These changes are part of the Bank’s plans and commitment to facilitate greater lending options and to drive investment into and by SMEs.

Mr Wilkinson said: “We are an established specialist bank focused on simple commercial property loans and business savings accounts, offering secured mortgages to professional landlords, and business owner occupiers.  We are experts in our chosen markets and use that expertise to deliver superior results for our customers and investors.

“Redwood Bank plugs a gap in the market where mainstream banks prefer not to lend. We dare to be different, as we truly understand the challenges of British businesses, responding to their concerns and supporting their need for flexibility and resilience in the face of a crisis.”

Redwood Bank was ‘born in the cloud’ in 2017, with its forward-thinking infrastructure helping it achieve one of the fastest ‘licence-to-launches’ in UK banking history. Having started with a team of 12, the Bank now employs more than 125 employees.  

Earlier this year, the Bank donated 600 trees as part of the Queen’s Green Canopy in a special ceremonial planting at Hertfordshire County Showground, attended by Lady Salisbury and the Lord Lieutenant of Hertfordshire Robert Voss CBE.

Find our Performance Summary report here