The British Business Bank has reported a significant increase in its pre-tax profit, rising to £426m in the year 2025/26, a 3x increase from last year's £144m profit. This milestone comes alongside a record £9.4bn of finance channeled to smaller firms, demonstrating that backing UK SMEs can yield returns for the taxpayer as well as the borrowers.
Notably, the Bank's largest profit since 2021/22 has been achieved through its Annual Report and Accounts for 2025/26, which show a sharp increase from the previous year. The more telling numbers, however, sit beneath the headline figure, with £1.3bn of public funding, £4.3bn of private capital, and £3.7bn of lending facilitated by the Bank's guarantees. These figures have a significant impact, reaching 30,000 businesses that had never received Bank-supported funding before, and 8,000 receiving follow-on finance.
The Bank's chief executive, Louis Taylor, highlighted the positive impact of the Bank's activities in 2025/26, stating that they are expected to produce an impact of 39,000 additional jobs and £8.8bn of gross value added over the life of the finance. Over the same period, the Bank expects £19.7bn of additional business turnover, supporting 340,000 existing jobs alongside the 39,000 new ones.
The Bank's guarantees have become an increasingly significant part of its story, with commitments rising 26 per cent to £2.5bn. This includes £1.3bn through the Growth Guarantee Scheme, which gives accredited lenders a government-backed guarantee to say yes to viable smaller businesses they might otherwise turn away. The Bank's own analysis has charted how far SME lending has shifted, with challenger banks now holding 60 per cent of the market.
The investment portfolio grew 25 per cent to £5.8bn, split between £4.4bn of equity and £1.5bn of debt. The Bank also recorded £115m of realised gains, taking its lifetime multiple on invested capital to 2.2x. Underlying operating costs fell to 1.08 per cent of assets under management, and the Bank recorded a 3.9 per cent five-year adjusted return.
The results come months into the Bank's five-year strategic plan, which has increased its capacity for new funded commitments and guarantees. The Bank's chair, Stephen Welton, highlighted the importance of the Bank's role in supporting growth across the country, targeting up to 370,000 new jobs and up to £57bn of additional GVA by 2030. The Bank has also noted its commitment to delivering economic growth beyond London, with 87 per cent of newly supported businesses based outside the capital.
