British Business Bank and Oxbury Collaborate on £100m ENABLE Guarantee Transaction

Last Updated on: 22nd November 2023, 05:04 am

The British Business Bank, in partnership with the specialist agricultural bank Oxbury, has inked a significant £100 million ENABLE Guarantee transaction. The collaboration aims to fortify Oxbury’s ability to bolster small and medium-sized enterprises (SMEs) within the agriculture sector.

Oxbury, standing out as the only UK bank exclusively dedicated to supporting farmers, food production, and the rural economy, anticipates leveraging this guarantee to foster up to £45 million in fresh lending to farming and food businesses.

This particular ENABLE transaction marks a unique milestone. It underlines the significance of the guarantee, providing immediate protection for the existing lending portfolio. This strategic move ensures that the lender can initiate roughly £45 million of supplementary lending to SME agricultural businesses right from the start.

The bank, established as a fully regulated entity in February 2021, prides itself on offering a spectrum of adaptable lending and asset finance solutions tailored specifically to cater to the distinctive requirements of farm businesses. Oxbury combines its proprietary digital banking platform – OxburyEarth – with a cadre of dedicated relationship managers equipped with extensive agricultural expertise to dispense tailored banking advice to its clients.

In less than three years, Oxbury has committed and initiated lending surpassing £750 million. Moreover, the bank has amassed £1 billion in savings deposits from farm businesses and consumers, illustrating a strong commitment to bolstering the rural economy. As it heads towards break-even profitability, Oxbury aims to achieve a £1 billion balance sheet in 2024.

Hailing from Chester, Oxbury draws support from institutional agriculture and AgTech investors, alongside other stakeholders within the sector. Notably, the bank has secured over £120 million in investments since its inception and plans to initiate further capital-raising efforts to sustain its lending growth.

Oxbury’s existing capital structure includes a £25 million Tier 2 capital facility from British Business Investments, acquired in August 2022. This injection of funds has already facilitated over £100 million in supplementary lending to SME farming and food businesses.

The bank’s commitment to delivering customised funding and data solutions is aimed at empowering farming and food businesses to drive efficiency, productivity, and sustainability. This support includes efforts to reduce carbon footprints, generate renewable energy, cultivate high-quality crops and livestock for both domestic and international markets, and diversify income streams.

Launching Oxbury NewGen in September 2022, the bank introduced a groundbreaking initiative to offer funding for new farming ventures. The primary goal is to provide advice and support to a new generation of farmers, offering them the best possible chance of success.

Moreover, Oxbury places significant emphasis on Environmental, Social, and Corporate Governance (ESG) matters. The “Responsible Impact” approach adopted by the bank actively guides farmers in adapting to the rapid changes required in land transformation and food production in the face of climate and environmental crises.

Expressing his enthusiasm about the collaboration, Tim Coates, Co-Founder and Chief Customer Officer at Oxbury Bank, highlighted their dedication to aiding SMEs across the farming and food system. Coates affirmed that the ENABLE Guarantee would facilitate an additional £45 million in lending to SMEs, marking a significant milestone in Oxbury’s journey to become the go-to bank for farmers across the UK.

Reinald de Monchy, Managing Director, Guarantee and Wholesale Solutions at British Business Bank, expressed his delight in finalizing the transaction with Oxbury. De Monchy pointed out the critical role of the ENABLE Guarantee in enabling Oxbury to expedite additional lending to small businesses, emphasizing the significance of this collaboration.

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