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Contents
Contents

Environmental, social
The Bank’s and governance
governance Strategic Report
policies and
processes Introduction
are set out
in detail on The environmental, social and governance
pages 42 – 71 (ESG) agenda is a key focus for the Board,
with regular debate and reports received
from the Executive relating to environmental,
community, and wider industry issues. The
Bank’s governance policies and processes
are set out in detail on pages 42 - 71.
The Bank is pleased to report The Board recognises the importance of Corporate Governance Statement

the successful extension the tone from the top so that the Board
Decisions made during the year culture to the Bank’s health and creates
The Board reaffirmed the Bank’s current ∞ Liquidity costs, greater commoditisation, of its carbon neutral status delivers on its responsibilities to all its various
stakeholders, especially our customers.
strategy, business structure, dividend and the continued rise in deposit brokers
policy and capital structure during 2021. in both the retail and SME markets; from 2020 to 2021. Reducing our environmental impact
The Bank’s strategy has remained broadly
unchanged since it started trading in 2012 ∞ Long term trends in technology Climate change is a significant challenge
and has resulted in a balance sheet with investment including IT data security and facing society, with a growing focus for
assets exceeding £1bn, with pre-tax profits cyber security threats; Other non-financial disclosures all stakeholders, and the Bank continues
in excess of £18m pa. to maintain a proactive approach to its
∞ Operational Resilience including the The Bank has a moral, legal, and regulatory environmental responsibilities. In 2021, the
The Board has assessed the future impact of Supplier/Outsourcing Risks; duty to prevent, detect and deter financial Bank collaborated with Lancaster University Independent Auditor’s Report
operating environment for the business and crime and maintains a financial crime Management School (LUMS) to further
expects continued growth in profits, and ∞ Geopolitical headwinds and post framework. This framework is supported advise how climate risk changes will impact
ongoing investment in people and systems. Brexit financial services equivalence and reinforced by the Bank’s systems and the Bank’s customer base, the properties
The Bank’s strategic objectives remain arrangements, trade negotiations, and behaviours which put the customer at on which it has lent money, and inform the
unchanged. The Bank plans to continue to the effects on UK business confidence; the heart of every interaction. The Bank environmental focus in the evolution of the
grow and bring its products and services to and promotes an environment that protects its Bank’s strategy.
a wider geographical footprint and expand customers, employees, and communities
its lending activities into new asset classes ∞ The increased focus on climate from financial crime, and continues to The Bank is currently focusing on
where the existing capacity and capability change risk. invest in its Anti-Money Laundering (AML) understanding the potential impact on
of the Bank can be brought to bear, and Know Your Customer (KYC) financial its loan security values and customers’
realising niche opportunities in markets The number of newly launched niche control system enhancements. The Bank’s investments from increased flooding as
that offer earnings at a level accretive to challenger banks, together with an increase compliance with requirements of the well as potential new legislation relating to Financial Statements
those achieved in the core businesses. in the non-banking participation in the financial crime framework is monitored minimum Energy Performance Certificate
asset finance market, has over the past through ongoing control testing, assurance, gradings. The Bank’s initial analysis has
The Bank’s future plans have been few years also had a significant effect audit, and the provision of management concluded that its exposure to properties
influenced by the following trends on lending margins. This has inevitably information at senior governance in high flood risk areas in England is limited
and risks: continued to put pressure on the Bank’s committees. The Bank’s Modern Slavery to 13 properties. Properties financed by
gross lending margins. We continue to Statement (which is available on our the Bank have a range of EPC gradings and
∞ Macroeconomic environment (bank ensure that our customers enjoy rates that website) sets out the policies we apply the Bank is currently developing plans for
base rate and property valuations) and compare well with those that are currently and actions we take to ensure that our how it can work with customers to assist,
the impact of Covid 19 and the Ukraine on offer in the market. Margin compression employees and customers are treated with where required, in the upgrading of property
conflict on the UK economy, is expected to continue although we dignity and respect. This includes raising energy standards. The Bank achieved its
remain confident that following the awareness of issues that could put the plans to be carbon neutral across its head
∞ Credit cycle impacts closely aligned expansion of our geographic footprint people the Bank comes into contact with at office site in Leicester in 2019, and is pleased Notes to the Financial Statements
to the above and the risk of material across the country, and investing in our risks such as vulnerability and exploitation. to report the successful extension of its
property price erosion; relationships with our broker introducers, The statement also explains how we ensure carbon neutral plus status from 2020 to
we will meet our growth appetite at that the Bank’s values are applied within our 2021 following inclusion of its two regional
∞ Changes in competition and margins commensurate with the Board’s supply chain including the due diligence we offices, as independently verified by Carbon
market demand; credit risk appetite. carry out on our suppliers. Footprint Ltd.