Summary Report and Accounts 2014 Unity Trust Bank Summary Report and Accounts 2014 03 Contents President’s Statement 05 – 07 Dave Prentis, President of Unity Trust Bank plc Strategic Report 08 – 15 Richard Wilcox, Chief Executive Officer of Unity Trust Bank plc Summary Directors’ Report 16 – 19 Kate Eldridge, Company Secretary of Unity Trust Bank plc Summary Directors’ Remuneration Report 20 – 21 Directors’ Emoluments 22 Pension Entitlements 23 Income Statement 24 Balance Sheet 25 Independent Auditor’s Report 26 It’s high time we start to celebrate the people that could give banking a good name. Unity Trust Bank has an outstanding track record of social banking, without a single millionaire or bank bonus in sight.” Ed Mayo, Secretary General, Co-operatives UK Front cover image: Unity Trust Bank Headquarters, Nine Brindleyplace, Birmingham 04 Unity Trust Bank Summary Report and Accounts 2014 Unity Trust Bank Summary Report and Accounts 2014 05 Unity Trust Bank plc Auditor Trades Union Congress KPMG LLP Transport Salaried Staffs’ Association Registered Head Office One Snowhill President’s Statement 2014 and Customer Service Centre UCU Snow Hill Queensway UNISON Nine Brindleyplace Birmingham B4 6GH Birmingham B1 2HB Unite the Union 2014 was a momentous year in the history of Unity Trust Bank. Tel: 0345 140 1000 Shareholders Unity Fax: 0345 113 0003 ACCORD USDAW We celebrated thirty successful years and prepared ourselves Registered in England and Wales Associated Society of Locomotive for the next stage of our history with a governance structure Shareholders and Capital No 1713124 Engineers and Firemen FCA firm reference No 204570 Association of Teachers and Lecturers Individual trades unions and trade and operation that is independent of The Co-operative Bank. union federations own 73.14% of the BALPA Board of Directors total equity capital of Unity Trust Bank Broadcasting, Entertainment, plc (14.64% in ‘A’ shares and 58.50% Those serving at 8 April 2015 are: Cinematograph and Theatre Union in ‘C’ shares). The Co-operative Bank Communication Workers’ Union plc, through its subsidiary Co-operative — Loyal and expanding — A fair approach to remuneration Dave Prentis (President) Community Commercial Limited, owns 26.66% customer base We have adopted the recommendation Graham Bennett (Chair) (14.64% in ‘B’ shares and 12.02% Educational Institute of Scotland Over 20,000 organisations bank with of the High Pay Centre to maintain Roderick Chamberlain in ‘C’ shares). us, ones that pursue social good a maximum ratio of 20 between our (Independent Director) FDA as well as sustainable returns. Our highest and lowest paid. We operate Certain individuals, including staff Clare Gosling Fire Brigades Union customers tell us that they choose a modest profit share scheme where members, between them own 0.20% to bank with us for our service and all staff, from the Chief Executive Billy Hayes General Federation of Trade Unions of the equity capital, all in ‘C’ shares. because our values are aligned with Officer to the most junior, receive GMB Total equity capital at 31 December Peter Kelly theirs. For example, they include the same percentage. Last year’s 2014 was £16,429,301. Ian Morrison Musicians’ Union most of the UK’s: police federations; distribution was 3.45% of salary Paul Noon OBE National Association of Colliery Overmen, The ‘A’ shares owned by trades TUC affiliated unions; Community and is 1.7% for 2014. We believe Deputies and Shotfirers Mike Osborne unions and the ‘B’ shares owned by Development Finance Institutions this drives the right staff behaviours National Association of Schoolmasters (CDFIs); credit unions; and a high and to many customers these Ed Sabisky The Co-operative Bank plc have certain Union of Women Teachers class rights attached to them concerning proportion of Citizens Advice Bureaux; pay principles are an important Richard Wilcox characteristic that differentiates Unity. National Union of Rail, Maritime and the election of Directors and certain other — Financially strong Our Employee Share Ownership Allan Wylie Transport Workers matters referred to in the Articles Dave Prentis of Association. We have a strong Core Tier 1 capital Scheme (ESOP) benefits all staff Executive Management Nautilus International ratio and liquidity. Our lending is all based on the success of the Bank Back in 1984, the Bank’s founding National Union of Mineworkers Strategic Report with funded by customer deposits, we are in achieving its objectives; Richard Wilcox, Chief Executive Officer principles set out to establish a unique sort Supplementary Material not reliant on the inter-bank money Kate Eldridge, Company Secretary National Union of Teachers of bank, one that would not be motivated markets. Unity has never traded in — Ethical business practices Nationwide Group Staff Union The Strategic Report is only part of the Kay Gossage, Head of Human Resources solely by the maximisation of profit but sub-prime investments or the complex We show leadership in our own Bank’s annual Report and Accounts for would embrace a philosophy of common Peter Kelly, Director, Business Development Northern Ireland Public Service Alliance financial instruments that have resulted business practices, evidenced through 2014. A full copy of the Bank’s annual good. It was the brainchild of the Trades and Marketing Prison Officers Association in difficulties for many organisations. our Living Wage accreditation and Report and Accounts is available on the Unions who wanted to create a bank that Ian Morrison, Director, Operations Prospect website (www.unity.co.uk). The auditor’s We are unaffected by events in awards, pioneering Fair Tax practices was truly good for society as a whole. these markets; and our successful apprenticeship Public and Commercial Services Union report on the annual accounts is unqualified. Mike Osborne, Finance Director Today those founding principles still hold and volunteering schemes; The Co-operative Bank plc firm with Unity. Its purpose remains to — Positive social impact The Society of Chiropodists achieve sustainable financial performance Our loan decisions include a — Experienced and motivated team and Podiatrists and positive social impact. We call this requirement to demonstrate positive We have loyal and motivated people our ‘double bottom line’. In our view, this social impact as well as financial at Unity who are proud to represent is how all banks should be: a belief that sustainability. We measure and report the Bank and what it stands for. events of the last decade seem to support. on all our lending impacts and publish information on our website; In the current economic environment, As President, I’m tremendously proud of the support that the Bank provides what we’ve achieved and that our founding — Customer driven for credit unions and CDFIs is vital to principles appear even more relevant today help the financially disadvantaged or than they were thirty years ago. They will We listen to our customers to enable us to develop products and services excluded, whether they be individuals continue to guide us, with the benefit of or small businesses. the strong foundations that we have in which meet their needs. It is important place at the end of 2014: to us to have high levels of customer satisfaction, consistently achieving 85% or over; 06 Unity Trust Bank Summary Report and Accounts 2014 Unity Trust Bank Summary Report and Accounts 2014 07 In addition, I would like to take this Throughout the first 30 years of its opportunity to thank four Board existence Unity has aspired to this and members who also left in 2014 – I look forward to seeing the next phase £30million Vicky Bryce from RMT and Paul Allton, of its development, where those Richard France and Steve Watts principles can be aligned to a bank lent to 57 organisations creating and protecting 3,423 jobs appointed by The Co-operative Bank. that has real growth potential. They brought valuable experience and knowledge to the Board. We welcomed 2015 will see Unity embark on its next Ed Sabisky to the Board; he was 30 years as an independent bank with a nominated by Unite and brings with very strong platform from which to grow him considerable financial expertise. and do more for its customers, and those very many enterprises and people that At the start of 2015 we welcomed Alan share our ‘double bottom line’ ethos. Hughes to the Bank on his selection Business Performance In conjunction with the Department At the start of Richard’s tenure he as our first independent Chair. Alan Whilst the banking industry as a whole for Business Innovation and Skills we embedded our new ‘double bottom comes with a proven ability to run comes under scrutiny after a series of 2014 pre-tax profit was £0.97 million, provide much needed finance to small line’ strategy. Unity’s profile as a retail banks with integrity. He places scandals and malpractices, I am proud £1.3 million lower than 2013 for the firms via CDFIs. In South Yorkshire we socially responsible and different kind particular value on probity, respect and that Unity has shown itself to be a force reasons explained below. Income support Finance For Enterprise (formerly of bank has grown during his term, trust in banking. In all his leadership for good. We are committed to enabling was broadly consistent with 2013, Donbac) that provides funding to SMEs with initiatives such as Living Wage roles he delivered successful growth social development and supporting but costs increased due to the who have been declined by the banks. accreditation and our pioneering stance and innovation. Alan spent 35 years community involvement for our customers work for Unity to achieve complete In 2014 we lent £330,000 to this CDFI on fair and transparent tax practices with HSBC where he was a UK General and the people they support.