- 23% balance sheet growth in 2012
- 16% increase in lending to sustainable businesses
- Total assets under management increase to EUR 8 billion
- Equity increase by EUR 114 million to support further growth
- Significant provisions continue to be necessary for energy production based on biomass
- Net profit up by 31% in 2012
- Opening representative office in France
Triodos Bank continued to grow in 2012, increasing its balance sheet by 23% to EUR 5.3 billion. Lending to sustainable businesses and projects rose by 16%, below an ambitious target. Some new loans took longer than anticipated to complete because of continuing economic challenges and uncertainties about government support for a number of sustainable sectors such as renewable energy and culture.
Total assets under management, comprised of Triodos Bank, Triodos Investment Funds and Triodos Private Banking grew by 19% to EUR 8 billion.
Triodos Bank’s net profit of EUR 22.6 million, represents an increase of 31% compared to 2011. Customer numbers were also up by 23%, to more than 437,000.
Triodos Bank is taking its first steps in France, opening a representative office in Paris in 2013. The office joins a network of branches in The Netherlands, Belgium, UK, Spain and Germany. The French office marks important progress in Triodos Bank’s ambition to become a genuinely pan-European Bank. Triodos Bank has built a loan portfolio of renewable energy projects in France over the past eight years, through its Belgian Branch. The representative office in Paris will support these activities, and explore the potential to further develop lending activities in France, and to open a fully-fledged branch in future years.
Triodos Bank CEO, Peter Blom: “Since the banking crisis began in 2008, Triodos Bank has more than doubled in size. For us growth is not an end in itself. But it is important because it means we are converting more deposits and investments into loans and investments in a new, sustainable economy. We are meeting real economic and social needs, and our growth reflects the fact that more and more savers and investors are, literally, buying in to the concept of using money more consciously. It proves that a different way of banking is both possible and attractive to large numbers of people.”
Triodos Bank’s Equity increased by 25%, or EUR 114 million, in 2012 of which EUR 96 million was thanks to a successful depository receipt issue. The new money comes from thousands of individuals, many of whom become co-owners of Triodos Bank for the first time. The investment proves that people are not only fully aligned with the bank’s values but also believe in the resilience of the banking model it has developed over the last 32 years and throughout the financial crisis. The number of depository receipt holders increased from 21,000 to over 26,000 by the end of the year.
Triodos Bank CFO, Pierre Aeby: “The new capital has helped to increase our core tier 1 ratio to 15.9%, at the end of 2012, well above our own requirements. This new capital provides a solid foundation for the continuous growth of our lending to sustainable sectors. Triodos Bank complies well with the capital and liquidity requirements, known as Basel III.”
The quality of the loan book remained satisfactory overall, despite the economic recession. However, significant provisions continued to be required for energy production based on biomass. Volatile demand, the high price volatility that stems from it, and immature technologies, have prompted serious problems in the sector. Triodos Bank’s exposure to the biomass sector is now well covered by loan loss provisions and should not have a material impact on its results in future years. The overall loan loss provision is 0.67% of the average loan book (2011: 0.63%).
Triodos Investment Management manages 19 retail and institutional investment funds, totaling EUR 2.2 billion in assets under management. Total growth of the investment funds was EUR 137 million, up 7%. Market sentiment and government austerity measures in Europe, effecting the renewable energy industry in particular, limited new investments and investment inflow.
Triodos Investment Funds invest in sustainable sectors such as microfinance, organic agriculture, cultural projects, renewable energy, sustainable real estate, and stock-market listed companies who are screened for their sustainable performance (SRI).
Impact in a number of sectors
By the end of 2012 Triodos Bank and its climate and energy funds under management financed 350 renewable energy projects across Europe producing the equivalent of the electricity consumption of approximately 1.3 million European households.
Impact investing in emerging markets was delivered through specialised microfinance funds providing finance to 99 emerging and well-established microfinance institutions in 45 countries. The microfinance institutions in its portfolio reached 6.9 million loan clients and served 6.4 million savers.
Sustainable banking works
There is empirical evidence that sustainable banking works not just for Triodos Bank but for values-based banks around the world, according to research published by the Global Alliance for Banking on Values. Over a 10 year period against almost every key financial measure, sustainable banks outperformed the world’s best-known banking names, proportionally lending more, growing more, and with stronger capital positions. At the same time, the returns from values-based banks were at similar and more stable levels.
Peter Blom: “This research highlights the solid business case for values-based banking, and demonstrates that there is room for more sustainability in the banking sector. But also a more diverse banking landscape will make the sector more resilient, and is better for both customers and taxpayers.”
Research by the Global Alliance of Banking for Values shows that sustainable banks allocate much more of their balance sheet to lending, relative to the big banks. This is important, because it challenges traditional notions that big is always better.
Prospects for 2013
Triodos Bank expects to continue to grow in 2013 by 15 to 20% while maintaining, or slightly improving, net profit. At the same time it recognises that the economic downturn that has resulted from the financial crisis will continue in 2013 and may also have a negative impact on Triodos Bank’s results.
All branches are expected to broaden their customer base. The number of customers is expected to grow by between 15 and 20%.
2012 Figures at a glance
- Triodos Bank balance sheet: EUR 5.3 billion (23% growth)
- Triodos Investment Funds: EUR 2.2 billion (7% growth)
- Private Banking assets under management: are now EUR 557 million (28% growth)
- Number of customers: 437,000 (23% growth)
- Sustainable lending: EUR 3.3 billion (16% growth)
- Triodos Bank net profit: EUR 22.6 million (31% growth)
- Core Tier 1-ratio: 15.9% (2011: 14.0%)
- Number of co-workers: 788 (9% growth)
About Triodos Bank
Founded in 1980, Triodos Bank has become a reference point for sustainable banking globally.
Triodos Bank is an independent bank that promotes sustainable and transparent banking. It does not see any conflict between a focus on people and the planet and a good financial return. Instead it believes that they reinforce each other in the long-term.
Triodos Bank has branches in the Netherlands, Belgium, UK, Spain and Germany. The Bank is a global authority in the field of microfinance in developing countries, Central Asia and Eastern Europe.
Triodos Bank co-founded the Global Alliance for Banking on Values, a network of 22 sustainable banks. Together these banks want to grow sustainable banking and its impact substantially.
In 2009 Triodos Bank was voted the most sustainable bank of the year, because of the leadership and innovation Triodos Bank has shown for the past 30 years in integrating sustainability in all its activities. An international jury, appointed by the Financial Times and the IFC - a member of the World Bank – voted for the winners at the FT Sustainable Banking Awards.
Triodos Bank N.V. has a full banking licence and is registered with The Nederlandsche Bank N.V. (the Dutch central bank) and The Netherlands Authority for the Financial Markets.