New institution for capital
Former banker sets up community bank ‘for all’
Castle Community Bank, a credit union, promises to provide financial products similar to High Street institutions, but with the emphasis firmly on sustainable banking and an ethical approach which puts “people before profit”.
It will pass surplus funds into communities around Edinburgh. The bank has no shareholders and is fully owned by its members.
The new bank has been formed from the merger of two long established credit unions in the capital that served the communities of Craigmillar and North Edinburgh.
Reverend Iain May, minister of South Leith Parish Church in Edinburgh, and a former banker with RBS and Allied Irish Bank Group, helped set up the bank.
He said: “Whilst we are different in structure to a traditional High Street bank, we adhere to the same robust regulatory requirements and independent scrutiny aimed at protecting our customers’ interests.
“Castle Community Bank has taken well over a year to launch because of the systems we had to adopt. Our core principle is to ensure that the vulnerable in our communities do not have to get caught up in a debt spiral or turn to payday lenders to make ends meet.
“Equally, our market research indicated that people across the city would welcome a bank with a strong ethical policy, one that took corporate social responsibility to its heart within every facet of its operation and, importantly, ensures that 100% of all profits were re-invested into the community at all times. On that basis, Castle Community Bank is a bank for all.”
The bank has a growing customer base, running well into four figures and a healthy deposit of customer savings, known as “member shares”, as well as an active loan book.
Its capital access ratio is 17% against the 3% regulatory minimum requirement.
Savings up to £75,000 are protected by the Financial Services Compensation Scheme. Castle’s maximum deposit is £15,000 and it is regulated heavily by the FCA and PRA.
The reverend May adds: “People want a community lender based in their community.
“I am absolutely certain that as we grow and the word spreads and people see the very competitive interest rates we offer, many will make the decision that some or all of their money should be in our community bank, rather than a large multinational which may be based in Frankfurt, London or Shanghai.
“It will make sense to a lot of people that investment in their own community bank gives something back to the very people they live amongst.”
Castle Community Bank has two “walk in” branches in Niddrie and Wardieburn.