Garden and Green

Credit Crunch Bypasses Ethical Bank

1st October, 2008

The international credit crisis has once again highlighted how important the banking sector is to the economy. Triodos Bank, an ethical bank is weathering the current credit crisis well. Because Triodos Bank is more concerned with personal relationships than with impersonal and financial transactions, they don’t invest in mortgage portfolios “packed" as investment products. As such, write-offs from these kinds of portfolios couldn’t affect Triodos.

Chairman of the board Peter Blom: “Triodos Bank wants to act as a bridge between savers and investors on the one hand, and sustainable companies and projects that need financing, on the other. Savers and investors know what happens with their money. In this respect, the banking sector has failed badly in recent years. Both customers and the banks themselves have lost sight of what is going on with complex products.”

Offering real financial transparency was one of the reasons why Triodos Bank was formed in 1980 and it is still highly topical today, as recent developments show. Indirectly however, Triodos Bank has been affected by the credit crisis. Competition in the savings market has increased considerably, and the lack of confidence in shares and securities has stifled growth in the volume of Triodos investment funds. Whereas over the first six months of 2007 growth was 3%, this has now fallen by 2%. The total capital of funds under management as at 30 June 2008 was EURO 1.4 billion. Triodos Bank’s balance sheet grew from EURO 1.9 billion on 31 December 2007 to EURO 2 billion on 30 June 2008 - a growth of 8%. The net profit of Triodos Bank during this period was EURO 3.7 million compared to EURO 3.6 million during the first six months of 2007.

Triodos has a new online saver account which is proving popular with new customers looking for a place where they feel their money is safe, worried about their savings in banks that are exposed to bad mortgage debts. The bank invests in renewable energy companies, organic enterprises etc and details of the social and evironmental projects being financed are published on their website. As well as retail banking the bank also offers products and services for the commercial sector.

Visit the site HERE for more info on their online savings account.