Presented in Rome on March 4, 2014 by ALTIS - Catholic University of Milan, the research on the social impact of the first financial institution entirely dedicated to ethical finance
A billion and 800 million Euros put into circulation to fund thousands of Italian families and social enterprises that have been able to increase the quantity and quality of care services for the most vulnerable; promoting art, culture and sport as a means to improve the quality of life for everyone; to defend legality; to reduce the CO2 emissions to protect the environment and health, and to promote organic products and methods, boost international cooperation projects and fair trade.
With this result, the Banca Popolare Etica celebrates its first 15 years of life. Founded in Padua in 1999 at the instigation of the main networks of the Italian Third Sector, it has grown steadily thanks to the trust bestowed upon it by individuals and organizations who have become associates and customers of the first Italian bank entirely dedicated to ethical finance.
All the numbers on this success story were presented today in Rome, at the Sala delle Colonne in the House of Representatives, during the presentation of the research on Banca Etica’s social impact, conducted by the study centre ALTIS, of the Catholic University of Milan. The survey, coordinated by Prof. Mario Molteni, was conducted by researchers Stella Gubelli, Valentina Langella, and Valentina Bramanti.
“Fifteen years ago, few people believed that an ethical bank could stay on the market today. We have shown that ethical finance works and can convey a strategic resource like savings and loans for citizens and organizations towards the promotion of the common good. Today we are not only a solid bank, but we are also developing continually, and in 2014 we will open the first branch in Spain, in Bilbao”, said Ugo Biggeri, Chairman of Banca Etica, speaking from Melbourne where he is attending the annual meeting of the international network of sustainable banks, Global Alliance for Banking on Values.
“Since 2008, the banks have experienced a period of great turbulence: they are responsible for a lasting crisis triggered by overly speculative finance, and have struggled to cope with the loss of confidence by investors and growing problems in the real economy. In the same years, Banca Etica has instead been experiencing a steady increase in confidence from investors and shareholders: savings and share capital at Banca Etica have grown significantly since 2008, allowing us to be one of the few banks that has continued to grant credit to families and social enterprises, with a non-performing loan rate that is well below the banking system’s average,” added Mario Crosta, General Manager of Banca Etica. He calls for a greater focus on financial issues by regulators in Italy and in Europe, to revise the rules that penalize those who give credit to social enterprises, and to promote banks that are involved with giving credit to the real economy, separating them from business banks.
“Measuring social impact means measuring the change generated in beneficiary organizations and families through funding and collaboration with Banca Etica. The experimental work, which involved key stakeholders of the bank - families and organizations – has achieved original results in both Italian and international terms.
The study shows that using finance as a tool to convey savings of individuals and organizations to support public projects generates a positive impact on the community. In particular, there are three areas of investment in which the impact of a loan granted by Banca Etica is particularly significant: social and health services, services for the promotion of cultural, recreational and sports activities and environmental initiatives. These areas concretely influence people’s quality of life,” explained the ALTIS researchers.
The social impact of Banca Etica in numbers over its first 15 years
In 15 years, Banca Etica has:
- provided a total of 23,804 loans to families and social enterprises;
- for a total of € 1.8 billion;
- 70% of the funding approved by Banca Etica has gone to non-profit organizations (compared to the 1% of the Italian banking system’s average). In recent years, Banca Etica has also gradually added some responsible for-profit organizations to its borrowers.
- the interest rates charged by Banca Etica loans to customers (families, non-profit organizations, social enterprises) are on the average lower than those of the rest of the banking system
- Banca Etica has recorded a steady growth of confidence by investors: in 2013 direct deposits grew by 11% while for the other banks, there has been a overall decrease of -1.9%
- The Bank records a much lower rate for non-performance loans than the banking system’s average. At the end of 2013, Banca Etica had 2.02% of non-performance loans compared to the 7.7% of the banking system’s average.
Organizations and businesses that have received funding from Banca Etica in these 15 years were issued a questionnaire by ALTIS, which concluded that:
- 63% of borrowers believe that collaborating with Banca Etica has increased their chances of networking. Networking as a way to strengthen and extend the work of many small Italian concerns in the field of civil economy is one of the factors that most characterizes Banca Etica’s economic vision.
- 62% say that collaborating with Banca Etica has made it possible to enhance their employees’ skills
- for 52%, turning to Banca Etica has made it possible to create new jobs
- for 51%, financing by Banca Etica has made it possible to increase income
- 44% of the customer funded believed they were able to achieve a savings by going to Banca Etica.
- for 82%, a loan from Banca Etica was “necessary” for continuing their activity.
- 47% of the customers obtained a loan from Banca Etica after one or more banks had refused to grant it.
- The loans granted by Banca Etica for the installation of systems for energy from renewable sources made it possible to avoid - every year - the emission of over 25 thousand tonnes of CO2, with a savings to the community estimated at 410 thousand Euros a year.
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