The UK Government-owned British Business Bank has been hit by an annual pre-tax loss of more than £147million.
The bank said this due to a drop in the market valuations of some of the companies it had invested in, particularly in the technology sector.
Chief executive Louis Taylor insisted taxpayers have not lost any money and the loss was expected after the group increased its investments in recent years.
He said: “I think we generate a good return for the taxpayer. These are long-term investments and we are confident that over time, when we actually realise these investments, they will yield profitable growth for us but also real social benefit for the economy.”
The development lender committed £1.6billion to funding agreements over the past year.
The value of the bank’s investments dropped by five percent, down £146million, in the 12 months to the end of March.
This was after the bank saw the value of its investments increase £619million in the year before.
The bank currently has invested £12.4billion in more than 90,000 businesses, which does not include the coronavirus-related loans it handed out.
The state-owned group oversees the Government’s three pandemic loan schemes and the Future Fund, which are now closed to applications.
Included in its offering is the Start Up Loans programme, which recently reached £1billion in lending.
More than half of these investments went to small businesses run by women and people from ethnic minorities.
This project is designed to back underrepresented groups that struggle to get help from mainstream lenders.
Mr Taylor said: “The bank is more than self-sufficient in terms of operating itself from the income it generates from the portfolio.
“If you add in the social value of what we do, [the return] is very high indeed.”
For the latest personal finance news, follow us on Twitter at @ExpressMoney_.
