The Scottish National Investment Bank (SNIB) is now in business, with a clearly focussed message built around its stated missions and a determination to make a difference for the people of Scotland.

What is the focus of the SNIB?

This is not a substitute for the European Investment Bank, which provided low cost long-term senior debt finance for major projects. Nor is it intended to compete with the available long-term finance which comes from global sources of capital. The focus of the SNIB is to be on development finance, picking up from where start-up capital is exhausted and taking forward businesses and projects so that at the same time, or at some later point, that traditional commercial finance can also be committed.

Investments will be offered on commercial terms, so subsidy control and similar issues should not be a concern. The SNIB will be patient, and will take equity as well as debt positions. Profits will be recycled rather than distributed back to shareholders, and the aim is to become self-financing over the medium term.

With a primary focus on the transition to net zero, alongside placemaking and innovation, and a real commitment to ethical investment, the SNIB will have no shortage of opportunities to invest, and its selection of which of them to back will be a crucial part of its early stage development. Market positioning will be all important.

What's on the horizon?

By its nature, it seems a different construct from what has gone before, such as the Green Investment Bank, and from what is coming along behind, namely the new National Infrastructure Bank to be based in Leeds.

There is the prospect of establishing a unique institution which can not only improve the financing markets coverage of Scottish business needs, but also help enthuse the people of Scotland to make the necessary behavioural changes, such as choice of heating systems or vehicles, that will be needed to achieve our low carbon objectives.