TOWN Hall chiefs at Warrington have confirmed their bold plan to invest up to £30 million in a new “challenger bank.”
The borough council is to form a partnership with Acorn Financial Partners (“AFP”), a new venture that has submitted a banking licence application to the Financial Conduct Authority (“FCA”) and the Prudential Regulation Authority (“PRA”).
On authorisation, AFP will be called Redwood Bank, a new business bank, and it will have its north regional office in Warrington.
Acorn was established last year by property investor David Rowland and his son Jonathan Rowland, who would be chairman of the new bank.
David Rowland is known to be a Conservative Party donor.
Redwood anticipates receiving its banking licence in the coming months and opening to customers later in the year.
The bank will aim to support local businesses – who are struggling to obtain finance in the current economic climate – as well as generating a return for the council. It will target secured lending to local Small Medium Sized Enterprises (SMEs), as well as national businesses to drive economic growth in Warrington. It will also provide business deposit accounts.
Cllr Russ Bowden (pictured), the council’s lead member for corporate finance, said: “In Warrington, we are doing everything we can to support the local economy and help businesses thrive. It’s an important part of securing a better future for the borough.
“These proposals are part of this wider work. It’s about us doing things differently and using innovative financial approaches to support growth and sustainability in Warrington.”
The council will take a 33 per cent share in the new bank. It will invest an initial £10m in the scheme. To mitigate risk, the business plan will be reviewed each year, with a view to investing a further £20m over the following two years.