The long-heralded Scottish National Bank has finally been launched with the bank’s first investment also being announced today,
It has taken almost three years to realise the plans set out by the Scottish Government to launch a bank that has the ambitious aim of transforming an economy that has often lagged the performance of the UK as a whole.
The aim is for the bank to provide ‘patient capital’ – long term investment for businesses and projects on Scotland that is too often left aside by existing private sector investors.
The Bank will use £2bn of Scottish government funding over its first decade to invest in businesses and projects that “help Scotland meet its 2045 net zero target, tackle place based inequality and foster innovation in the country’s businesses.”
Launching the Bank, First Minister Nicola Sturgeon described the project as “one of the most significant developments in the lifetime of this parliament”.
The first investment officials announced would be Glasgow-based laser technology company M Squared Laser.
Chairman Willie Watt said he hoped the bank would eventually become a national, non-political institution.
He said: “I want it to become a trusted institution that is seen as being owned by the whole of Scotland.
“A non-political, cornerstone institution in the investment landscape in Scotland.
“I want it to have a list of really good investments against each of those three missions so we can look back and say that we actually invested against these missions.”
Funding will be provided in multiple forms, including through loans and equity.
Profit targets for the bank will be set in the coming months, the chairman said, however, he does not expect money to be flowing into the bank for the first few years.
The First Minister said: “The Scottish National Investment Bank will help to tackle some of the biggest challenges we face now and in the years to come, delivering economic, social and environmental returns.
“It is hitting the ground running with its first major investment in M Squared – a great example of the ambitious and innovative companies we have here in Scotland that will be key to our economic recovery and future prosperity.
“The launch of the bank is one of the most significant developments in the lifetime of this parliament, with the potential for it to transform, grow and decarbonise Scotland’s economy.”
Dr Graeme Malcolm, the founder of M Squared, said: “Science and advanced technologies have a major role to play in Scotland’s future economic prosperity.
“By increasing investment in research and development with a mission-based approach, Scotland has a real opportunity to actively tackle climate change and benefit from the coming quantum revolution.
“We are delighted that the Scottish National Investment Bank has invested in M Squared as its very first business – our shared commitments to society and the environment makes this an ideal partnership that will enable accelerated growth and progress in frontier technologies.”
After being heralded in speeches a number of times by the First Minister, plans for the Bank were unanimously passed by MSPs in January.
Key appointments have been made and announced in months leading up to today’s launch.
The appointment of eight non-executive directors was announced earlier this month.
The non-executive directors are:
- Tracey Ashworth-Davies, director of workforce for NHS Education for Scotland
- Carolyn Jameson, chief legal officer at consumer review platform TrustPilot
- Peter Knott, managing director of McQuarie’s Green Investment Group
- Jason McGibbon, a board member of Fable Data and the University of Strathclyde Alumni Fund
- Nicholas Moon, a partner at international private equity investor Leapfrog Investments
- Candida Morley, director and head of governance at UK Government Investments
- Dr Jacqueline Redmond, non-executive Chair of innovation centre CENSIS and
- Sir Jonathan Taylor, just retired vice president of the European Investment Bank
The creation of a Scottish National Investment bank was first announced in the Programme for Government in 2018, followed by the introduction of the Scottish National Investment Bank Bill to the Scottish Parliament in February 2019.
The plan has faced criticism because of a possible overlap and lack of function clarity with the existing Scottish Investment Bank.