by business editor Trevor Sturgess

A bank that helps good causes has shamed high street financial institutions by boosting lending by more than 300% since the financial crisis exploded five years ago.

Charity Bank, based in Tonbridge, has pushed up loans to charities and social enterprises from £20m to £61m (up 300%) and deposits from £33m to £76m (200%). In the first six months of the year, 440 new customers opened saving accounts, a 200% jump on the same period in 2011 when just 135 investors signed up.

The bank is one of the few financial organisations to benefit from the credit crunch, with an increasing number of investors disgusted with traditional banks looking for an ethical home for their money.

As high street lenders withdrew from the market, Charity Bank hiked lending to otherwise excluded parts of the charity sector. This growth has given much needed financial support to charities and not-for-profit organisations.

Charity Bank’s research found that 70% of funded projects would not have gone ahead without the loan. Organisations supported by the bank have benefited an estimated 3.5m people. Ninety-nine per cent of respondents said they would recommend the bank.

Bank chairman George Blunden said: “We have achieved significant deposit growth as distrust of high street banks has driven consumers towards ethical alternatives. Ordinary members of the public have increasingly been seeking alternatives to depositing their savings in commercial banks, where they will have no idea what use their money is put to.

“This deposit growth has enabled Charity Bank to increase its lending to charities and not-for-profit organisations at a time when the charity sector has struggled to raise finance from traditional sources.”

He added that Charity Bank was a powerful alternative to traditional banking. “ If you have money to save and you also want to make a difference in society, you can put it in Charity Bank. You will get a return, you will benefit charities and communities and you’ll get all your money back at the end. It’s no-brainer banking.”

Meanwhile, the bank’s founder and chief executive Malcolm Hayday has confirmed he will be stepping down this year. Charity Bank has been seeking a replacement and expects to name his successor soon.