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Have you thought about Loans?
Chapman Harrison
Regional Manager – South West
Charity Bank

27th November 2013

a different...
Introduction







Charity Bank
Investment Readiness
Types of finance – logic path
Examples
A cautionary note
Time ...
Charity Bank

“I do not have very much
money to invest or to give
and Charity Bank enables
me to contribute to good
projec...
What is Charity Bank?

• A Bank that has a social mission
• Supporting social purpose organisations
• Helping deliver soci...
How do we achieve our Mission?
• We provide affordable loan finance to charitable / social purpose
organisations that are ...
Investment Readiness
A state of preparedness to obtain / receive external
investment. Track
record, Structure, Governance,...
What is investment readiness
Commercial
Finance
Social
Finance
1:2
Grant/Loan
Fund
1:1
Grant/Loan
Fund
Fundraising/
Grants...
How Can You Make Yourself
Investment Ready?
• Recruit Trustees with necessary skills
• You need a continuing income stream...
Why use loan finance ?
•
•
•
•
•
•

Purchase / Develop a building
Refurbish a building
Bridge receipt of a grant or other ...
What sort of things have Charity Bank funded?
•Hostels for the Homeless with drug / alcohol issues
•Refurbishment of Almsh...
Loan Finance – the benefits

•

Enables a project to be delivered NOW providing services to
beneficiaries AND generating i...
Loan Finance – the small print
• Minimum £50,000, Maximum £1M +
• Loan term up to 25 years
• Secured and Unsecured (max 5 ...
Points to be aware of

Other lenders may demand Trustee guarantees (Charity Bank does not)
Pre-drawdown conditions (e.g. P...
Charity Bank Borrower:
Half Moon Young People‟s Theatre

a different bank for people who want a different world

A differe...
Thank you.

For further information please contact:

Chapman Harrison
07795 107173
charrison@charitybank.org

a different ...
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Charity Bank - Have you Thought about Loans?

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Charity Bank - Have you Thought about Loans?

  1. 1. Have you thought about Loans? Chapman Harrison Regional Manager – South West Charity Bank 27th November 2013 a different bank for people who want a different world
  2. 2. Introduction       Charity Bank Investment Readiness Types of finance – logic path Examples A cautionary note Time for your questions a different bank for people who want a different world
  3. 3. Charity Bank “I do not have very much money to invest or to give and Charity Bank enables me to contribute to good projects despite this difficulty.” Quote from a Charity Bank depositor a different bank for people who want a different world
  4. 4. What is Charity Bank? • A Bank that has a social mission • Supporting social purpose organisations • Helping deliver social impact and change a different bank for people who want a different world
  5. 5. How do we achieve our Mission? • We provide affordable loan finance to charitable / social purpose organisations that are usually unable to borrow elsewhere • Our work is funded by individuals and organisations that use their savings as a positive source for change • They get a financial return on their money and a social return from knowing what they have helped fund • Every pound deposited is used to provide loans to charities, community and voluntary groups and social enterprises • We work with a variety of partners to create alternative and creative funding solutions a different bank for people who want a different world
  6. 6. Investment Readiness A state of preparedness to obtain / receive external investment. Track record, Structure, Governance, Management capability, Business Plan, Ability to produce timely financial reports and Forecasts. Ability to repay. Is taking external investment appropriate? If I am interested, where can I go to find out more? a different bank for people who want a different world
  7. 7. What is investment readiness Commercial Finance Social Finance 1:2 Grant/Loan Fund 1:1 Grant/Loan Fund Fundraising/ Grants a different bank for people who want a different world
  8. 8. How Can You Make Yourself Investment Ready? • Recruit Trustees with necessary skills • You need a continuing income stream to be able to repay a Loan • Employ / Take advice from professional firms: Accountants, Solicitors, Marketing. Some may work on a pro bono basis • Talk to other organisations doing similar things • Big Lottery seeking to launch an Investment Readiness Fund a different bank for people who want a different world
  9. 9. Why use loan finance ? • • • • • • Purchase / Develop a building Refurbish a building Bridge receipt of a grant or other income Working capital facility Acquisition of equipment „Last brick‟ funding - One, or any mix of the above a different bank for people who want a different world
  10. 10. What sort of things have Charity Bank funded? •Hostels for the Homeless with drug / alcohol issues •Refurbishment of Almshouses •Building new Village Halls •Buying a building to use as a Community Centre •Development of Affordable Homes •Respite Care Homes •Supported Living Homes •Pre-School / Nursery facilities •New facilities for Sports Clubs •Office space with additional space available for letting to give income stream a different bank for people who want a different world
  11. 11. Loan Finance – the benefits • Enables a project to be delivered NOW providing services to beneficiaries AND generating income • Can avoid potential increase in costs (building cost inflation) • Unable to obtain grant funding • Lending against pledges/retrospective grants a different bank for people who want a different world
  12. 12. Loan Finance – the small print • Minimum £50,000, Maximum £1M + • Loan term up to 25 years • Secured and Unsecured (max 5 years) • Secured on property or other assets • Loan to value (normally 70% max) • Borrowing rate – typically 6.50% Secured / 7.50% Unsecured • Fees: 1.00% Arrangement Fee, plus you pay own Legals / Valuation Costs etc. • Covenants: What we both expect to see a different bank for people who want a different world
  13. 13. Points to be aware of Other lenders may demand Trustee guarantees (Charity Bank does not) Pre-drawdown conditions (e.g. Planning Permissions) On-going financial covenants (e,g. Debt Service Cover) On-going information requirements (Quarterly Accounts / copy bank statements) Possible Breakage costs / early repayment penalties on your existing Loan Events of default and consequences of default a different bank for people who want a different world
  14. 14. Charity Bank Borrower: Half Moon Young People‟s Theatre a different bank for people who want a different world A different bank for people who want a
  15. 15. Thank you. For further information please contact: Chapman Harrison 07795 107173 charrison@charitybank.org a different bank for people who want a different world

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