Why it is important: When we manage our programmes efficiently, we deliver value for money. All UK taxpayers benefit from our ability to deliver the most positive outcome with the least amount of Government resources.
All our programmes, with the exception of the grant funding and operating costs element for Start Up Loans, count towards our financial return target. The Bank targets achieving a return on capital at least equivalent to the Government’s medium term cost of capital. We have a target for the end of March 2019 of 2.525%.
Adjusted return on capital employed
The British Business Bank achieved a 3.9% adjusted return on capital employed in 2016/171, which was higher than the return generated in 2015/16 and our target for the year. This rise was principally generated by strong investment performance, with an increase in income from the Investment Programme assets, positive fair value movements on VC Catalyst and legacy Venture Capital funds and foreign exchange gains. 2016/17 also saw continued strong performance from Lending Solutions’ EFG programme, with lower than expected claims in a benign credit environment. Excluding foreign exchange gains of £2.6m the return would have been 0.2% lower.
