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British Business Bank Investments backs Northwest asset finance provider with £5m investment, introduces new expansion capital initiative

Press release 02 February 2015

Kingsway investment reaffirms commitment to support asset and lease finance providers

British Business Bank Investments Limited, the commercial arm of the British Business Bank, is investing £5 million in Kingsway, a Cheshire-based asset finance specialist. The investment is expected to increase Kingsway’s leasing capacity by up to £10 million.

This investment is the latest in a series of commitments from British Business Bank Investments Limited in the leasing and asset finance space. In October, British Business Bank Investments provided a £40 million boost to Staffordshire-based Shire Leasing, which was matched by private sector investment. British Business Bank Investments Limited’s parent company, British Business Bank plc, recently launched its ENABLE programme to improve the ability of independent lease companies to access more competitive funding via the capital markets.

Leasing and asset finance allows smaller businesses to invest in assets or equipment for growth. The British Business Bank’s recent Small Business Finance Markets report revealed that 43% of businesses seeking finance are looking to purchase fixed assets, an increase of 10% since 2012.

These recent investments demonstrate how British Business Bank is delivering on its promise to provide regionally-based commercial business lenders with additional capital to lend to their local businesses.

In a further development, British Business Bank Investments Limited is introducing a new Expansion Capital initiative to its Investment Programme, enabling investments either by way of long term equity or other form of risk capital to support the growth of companies active in SME lending markets.

Leasing and asset finance plays a crucial role in the diverse finance markets for UK smaller businesses. We believe we have already had a material impact on the block funding market, which is key for independent lease companies.

We are continuing to support regional providers such as Kingsway, which are vital in ensuring we have finance markets which work better for UK smaller businesses. Our aim is to unlock more finance, offer more choice and ensure smaller businesses can make well-informed decisions about the right funding route for them.

The introduction of our new Expansion Capital initiative, made possible our recent EC State Aid clearance, means we can invest with much greater flexibility as sole investor, enabling us to create greater impact with our funding

Peter Wilson CEO of British Business Bank Investments Limited

The North West is home to a thriving start up and small business community which we have been supporting for over 10 years.

The new British Business Bank Investments Limited facility will enable Kingsway to significantly increase our lending to small businesses both in the North West and further afield.

Adrian Anthon Managing Director of Kingsway

Further Information

Notes to editors

About British Business Bank Investments Limited

British Business Bank Investments is the commercial subsidiary of British Business Bank plc. It aims to earn a commercial return by investing debt and equity into providers of finance to smaller businesses and small mid-caps, pursuing investments on a fully commercial basis without receiving any advantage from the government.

In doing so, it aims to:

  • support the development of diverse debt and equity finance markets which supply small to smaller mid-cap businesses
  • increase the level of finance to those businesses, in particular improving the provision of long-term finance
  • promote competition and increased supply through new and existing finance providers

British Business Bank Investments Limited operates primarily in the smaller and mid-sized business finance markets. Depending on the overall business strategy and objectives agreed through its annual business plan, British Business Bank Investments Limited may at times also include larger firms in its portfolios.

A complete legal structure chart for British Business Bank plc and its subsidiaries can be found on the British Business Bank website.

About Kingsway

Kingsway Asset Finance Ltd was established in 1997 and is a supplier of leasing and hire purchase finance to UK small businesses, via a network of approved Brokers and Equipment Dealers. Based in Wilmslow, near Manchester Airport, Kingsway transacts business in all regions of the UK mainland.

About British Business Bank Investments Limited’s new Expansion Capital initiative

The new Expansion Capital initiative will be a variant of the existing £400m Investment Programme designed to support the development of diverse debt finance markets for SMEs. The Expansion Capital initiative:

  • means British Business Bank Investments Limited can now make equity or other risk tranche investments as lead or sole investor
  • removes the need for investments to be match-funded provided applicants can demonstrate sufficient leverage or otherwise be assessed as having a very good fit with Programmes aims
  • is designed to provide development capital to speciality SME lenders