UK Challenger Redwood Bank Reports First Profit in 2021

Redwood Bank, the first cloud based UK challenger bank, has reported its first profit in 2021.

The specialist lender recorded a pre-tax operating profit of £2.2 million in the year to December 31, 2021 (2020: loss £1.7m), while its loan book increased by 14 per cent to £370m (2020: £324m) and deposits rose by 15 per cent to £438m (2020: £380m).

Gary Wilkinson, CEO and Co-Founder of Redwood Bank, said: "Where we are from is important to us, we are a part of the community. The fact that we made our first profit, in 2021, is testament to the robustness of our business model.  

"We reached this milestone because we continued to offer vital lending support to British businesses during the various COVID-19 lockdowns, when many other mainstream lenders retrenched. We are proud to have played our part in bolstering the resilience of British business." 

The results illustrate the resilience of Redwood Bank's business model at one of the most challenging times for UK businesses, with shareholders investing a further £9.9m of Tier 1 capital in the Bank during the year, increasing the total invested to £47.9m.

The Bank recently increased its maximum Loan to Value (LTV)s on mortgages up to 70 per cent for commercial loans and to 75 per cent for residential loans. These changes are part of the Bank’s plans and commitment to facilitate greater lending options and to drive investment into and by SMEs.

Mr Wilkinson said: "We are an established specialist bank focused on simple commercial property loans and business savings accounts, offering secured mortgages to professional landlords, and business owner occupiers.  We are experts in our chosen markets and use that expertise to deliver superior results for our customers and investors."