David Cameron’s Big Society Bank was launched on Friday with £600m to invest in charities and social enterprises.
Now named Big Society Capital the bank has the backing of the biggest figures in business. Former venture capitalist Sir Ronald Cohen will work as the interim chair of the group which operates the bank.
Former JP Morgan global head of research Nick O’Donohoe will be the bank’s CEO, and former head of the CBI Sir Richard Lambert will sit on its board, to oversee the venture.
Cabinet office minister Francis Maude heralded the bank saying it could “change the world”: “We’ve all heard about a small charity or social enterprise sweeping away entrenched local social problems. But we have not seen a significant commitment to help social innovations grow and be implemented on the national stage until now.”
The bank will invest in charities and voluntary groups and is to receive £400m from Dormant bank accounts in the UK.
HSBC, Royal Bank of Scotland, Lloyds and Barclays will also invest £200m in the bank under the terms of the Merlin agreement – the deal banks and government came to in the wake of the economic crisis.
The heads of the banks released a joint statement saying: “We are delighted to support the Government’s efforts to transform the UK social finance market and are investing £200m collectively to launch Big Society Capital catalyst for creating a sustainable social finance model in the UK. This investment evidences our commitment to working with the team at Big Society Capital to make their vision of sustainable social finance a reality.”