British Business Bank

UK state-owned economic development bank

British Business Bank plc

Company type| State owned public limited company
Industry| Financial services
Investments
Predecessors|

* Capital for Enterprise
* parts of the Department of Business, Innovation and Skills

Founded| 1 November 2014 (2014-11-01)
Headquarters|

Sheffield

United Kingdom

Area served

| United Kingdom

Key people

* Stephen Welton (chair)
* Louis Taylor (CEO)

Owner| HM Government
(Department for Business and Trade)
Subsidiaries|

* British Business Investments
* British Financial Services
* British Patient Capital
* Capital for Enterprise
* National Security Strategic Investment Fund
* The Start-Up Loans Company

[1]
Website| www.british-business-bank.co.uk

British Business Bank plc (BBB) is a British state-owned economic development bank established by the UK Government. Its aim is to increase the supply of credit to small and medium-sized enterprises as well as providing business advice services. It is structured as a public limited company and is owned by the Department for Business and Trade (formerly known as the Department of Business, Innovation and Skills or BIS). The bank has its headquarters in Sheffield.

## History

[edit]

The intention to create a business bank was first announced by the Secretary of State for Business, Innovation and Skills, Vince Cable, in September 2012 with an initial £1 billion of government funding.[2] The aim was to bring a number of government financial schemes, advice services and expertise together, creating a one-stop shop for small and medium-sized enterprises (SMEs) to go to. From 1 October 2013, Capital for Enterprise Limited, BIS SME policy teams and private sector expertise were brought together within BIS to start the British Business Bank programme. On 2 December 2013 the Deputy Prime Minister, Nick Clegg, announced that the bank would be based in Sheffield, as well confirming an extra £250 million of government funding.[3] On 15 October 2014, the bank was granted state aid clearance from the EU Commission[4] and the programme was subsequently transferred from BIS to British Business Bank plc on 1 November 2014.[5]

Under her manifesto for the 2017 general election, Prime Minister Theresa May announced that the bank would take over from the European Investment Bank after Brexit, receiving the UK funds hitherto earmarked for the European Investment Fund.[6] To support this expansion the bank would open new offices in Edinburgh, Manchester, Birmingham, Cambridge, Newport, and Bristol.

In 2018, the National Security Strategic Investment Fund was created to provide long-term equity in advanced technologies relevant to national security, partly modelled on In-Q-Tel in the United States.[7][8] The UK intelligence and security agencies, led by the Secret Intelligence Service (MI6), would provide guidance to the investments. The kind of technologies previously developed within government have now often been commoditised and are produced in the private sector.[9][10]

## Operations

[edit]

The bank has taken on all financial schemes previously controlled by Capital for Enterprise Limited, such as Enterprise Capital Funds, the Enterprise Finance Guarantee, Business Angel Co-investment Funds and the Small Firms Loan Guarantee. In addition, the bank ran the assessment process to select Bizfitech, Funding Xchange and Funding Options as designated finance platforms for the bank referral scheme.[11]

The bank mainly targets its assistance to companies with a turnover of up to £25 million. The bank does not lend to SMEs directly, but instead works with other financial institutions to increase access to funding, such as by providing part-guarantees for loans.[12]

The bank came under criticism from lender Rebuildingsociety.com in 2014 for its execution of the Funding for Lending scheme, saying it created unfair competition in the UK peer-to-peer lending industry by concentrating financial support via the largest platforms.[13]

After the January 2018 liquidation of Carillion threatened thousands of suppliers, particularly SMEs, £100 million of lending was offered by the British Business Bank[14] alongside a fund established by HSBC, Royal Bank of Scotland and Lloyds Bank.[15]

In 2020 the National Security Strategic Investment Fund was involved in the UK government's decision to invest £400 million for a 45% stake in OneWeb, a struggling low Earth orbit satellite communications business.[7] It was reported that the UK would repurpose the satellites for the United Kingdom Global Navigation Satellite System,[16] but by September 2020 that strategy was being reconsidered.[17] The government's stake in OneWeb was diluted in July 2022 when the company was merged into French rival Eutelsat.[18]

In January 2022, as a result of a loan to the club being translated into shares, the bank became a minority interest in Bolton Wanderers F.C..

In February 2022, the bank launched its 'sustainability hub' which aimed to alert smaller businesses to the commercial benefits of investing in decarbonisation.[19] The hub's resources include articles on topics such as creating action plans, sustainable logistics, and how to a build a green supply chain.

## See also

[edit]

* List of national development banks

## References

[edit]

1. ^ "Corporate information and subsidiary companies – British Business Bank". British Business Bank. Archived from the original on 4 February 2018. Retrieved 3 February 2018.
2. ^ "Lib Dem conference: Cable promises £1bn 'business bank'". BBC News. 24 September 2012. Archived from the original on 14 July 2023. Retrieved 10 February 2014.
3. ^ "Government's British Business Bank gets another £250m". The Guardian. 2 December 2013. Archived from the original on 23 February 2014. Retrieved 10 February 2014.
4. ^ "European Commission approves British Business Bank". Reuters. Archived from the original on 5 March 2016. Retrieved 3 November 2014.
5. ^ "Lending already reaching smaller businesses for the British Business Bank on day 1". British Business Bank. 3 November 2014. Archived from the original on 4 November 2014. Retrieved 3 November 2014.
6. ^ "Economic interventions sometimes justified, but Tories must remember government has limitations". Institute of Directors. 18 May 2017. Archived from the original on 4 June 2020. Retrieved 4 June 2020.
7. ^ a b Cook, James (18 July 2020). "The secretive UK fund behind the government's $500m investment in OneWeb". The Daily Telegraph. Archived from the original on 24 July 2020. Retrieved 24 July 2020.
8. ^ Long, Alexis (28 February 2020). "What the UK can learn from the US about national security innovation". Civil Service World. Dods Parliamentary Communications. Archived from the original on 24 July 2020. Retrieved 24 July 2020.
9. ^ Bond, David (25 September 2018). "Tech companies targeted in mission to develop new spy tools". Financial Times. Archived from the original on 24 July 2020. Retrieved 24 July 2020.
10. ^ "The National Security Strategic Investment Fund". British Business Bank. Archived from the original on 14 July 2023. Retrieved 24 July 2020.
11. ^ "Finance platform referrals policy". Archived from the original on 6 November 2016. Retrieved 5 November 2016.
12. ^ "British Business Bank to target SMEs with potential". Financial Times. Archived from the original on 9 February 2014. Retrieved 10 February 2014.
13. ^ "Government interference risks distorting UK P2P market, say lenders". Financial Times. 26 October 2014. Archived from the original on 8 December 2014. Retrieved 15 December 2014.
14. ^ "Carillion collapse: UK puts up £100m to back Carillion contractor loans". BBC News. BBC. 3 February 2018. Archived from the original on 4 February 2018. Retrieved 5 February 2018.
15. ^ Gill, Oliver (18 January 2018). "Government sets up Carillion task force". City AM. Archived from the original on 22 January 2018. Retrieved 5 February 2018.
16. ^ "UK government takes £400 million stake in satellite firm OneWeb". BBC News. 3 July 2020. Archived from the original on 17 May 2022. Retrieved 30 March 2024.
17. ^ Foust, Jeff (25 September 2020). "U.K. to revise strategy for satellite navigation system". SpaceNews. Retrieved 3 August 2022.
18. ^ Makortoff, Kalyeena (24 July 2022). "Satellite firm bailed out by UK to be taken over by French rival". the Guardian. Archived from the original on 8 October 2023. Retrieved 3 August 2022.
19. ^ "Sustainability". British Business Bank. Archived from the original on 19 January 2024. Retrieved 3 August 2022.

## External links

[edit]

* Official website

* v
* t
* e

Department for Business and Trade

Ministers|

* Secretary of State for Business and Trade: Jonathan Reynolds
* Minister of State for Trade Policy and Economic Security: Douglas Alexander
* Minister for Industry: Sarah Jones
* Parliamentary Under-Secretary of State for Employment Rights, Competition and Markets: Justin Madders
* Parliamentary Under-Secretary of State for Services, Small Business and Exports: Gareth Thomas
* Parliamentary Under-Secretary of State for Legislation: The Baroness Jones of Whitchurch

Civil Servants

| Permanent Secretaries|

* Gareth Davies
* Crawford Falconer

|

Directors General|

* David Bickerton
* Amanda Brooks
* Joanna Crellin
* Caleb Deeks
* Beatrice Kilroy-Nolan
* Gavin Lambert
* Andrew Mitchell
* Bidesh Sarkar (interim)
* Ceri Smith

Departmental Chief
Scientific Adviser|

Julia Sutcliffe

Non-ministerial departments|

* Competition and Markets Authority

Executive agencies|

* Companies House
* Insolvency Service

Non-departmental
public bodies

| Executive|

* Advisory, Conciliation and Arbitration Service
* British Hallmarking Council
* Competition Service
* Financial Reporting Council
* Small Business Commissioner
* Trade Remedies Authority

|

Advisory|

* Low Pay Commission
* Regulatory Policy Committee

Tribunal|

* Central Arbitration Committee
* Competition Appeal Tribunal

Public corporations|

* Post Office Limited

Other|

* British Business Bank
* Certification Officer
* Groceries Code Adjudicator
* Office of Manpower Economics
* Office of the Regulator of Community Interest Companies
* Pubs Code Adjudicator

Scrutiny|

Business and Trade Select Committee

Preceding departments|

* Department for Business, Energy and Industrial Strategy
* Department for International Trade

Category

* v
* t
* e

Department for Business, Energy and Industrial Strategy

Ministers|

* Secretary of State for Business, Energy and Industrial Strategy: Grant Shapps
* Minister of State for Climate: Graham Stuart
* Minister of State for Science, Research and Innovation: George Freeman
* Minister of State for Industry and Investment Security: Nusrat Ghani
* Parliamentary Under-Secretary of State for Enterprise, Markets and Small Business: Kevin Hollinrake
* Parliamentary Under Secretary of State (Minister for Business, Energy and Corporate Responsibility): Lord Callanan

Non-ministerial departments|

* Competition and Markets Authority
* HM Land Registry
* Ofgem

Executive agencies|

* Companies House
* Insolvency Service
* Intellectual Property Office
* Met Office
* UK Space Agency

Non-departmental
public bodies

| Executive|

* Advisory, Conciliation and Arbitration Service
* British Hallmarking Council
* Civil Nuclear Police Authority
* Committee on Climate Change
* Competition Service
* Mining Remediation Authority
* Nuclear Decommissioning Authority
* Salix Finance Ltd
* Small Business Commissioner
* UK Atomic Energy Authority
* UK Research and Innovation
* Innovate UK

|

Advisory|

* Committee on Fuel Poverty
* Committee on Radioactive Waste Management
* Industrial Development Advisory Board
* Land Registration Rule Committee
* Low Pay Commission
* Nuclear Liabilities Financing Assurance Board
* Regulatory Policy Committee

Tribunal|

* Central Arbitration Committee
* Competition Appeal Tribunal
* Copyright Tribunal

Research councils|

* Arts and Humanities Research Council
* Biotechnology and Biological Sciences Research Council
* Economic and Social Research Council
* Engineering and Physical Sciences Research Council
* Medical Research Council
* Natural Environment Research Council
* Science and Technology Facilities Council

Other|

* British Business Bank
* Certification Officer
* Commissioner for Shale Gas
* Financial Reporting Council
* Government Office for Science
* Council for Science and Technology
* Groceries Code Adjudicator
* Independent Complaints Reviewer
* Office of Manpower Economics
* Office of the Regulator of Community Interest Companies
* Office for Product Safety & Standards
* Oil and Gas Authority
* Ordnance Survey
* Pubs Code Adjudicator

Category
*[v]: View this template
*[t]: Discuss this template
*[e]: Edit this template