THE Scottish National Investment Bank (SNIB) made a net loss of almost £140 million last year, according to its accounts.
Three investments made in the early years of the bank – which was set up by Nicola Sturgeon during her time as first minister – have failed, leading to £65m in realised losses in the 2025-26 financial year.
There was also £85m in unrealised losses as a result of drops in the value of investments and the failure of two other companies, but their administration processes were not complete by the March 31 deadline of the accounts.
According to the report, the SNIB does not expect to recoup its investment from a further seven companies.
When the losses are removed, the SNIB made a £12m operational profit, leading to a net loss of £138m.
The SNIB’s chairman Willie Watt, writing in its annual report, said: “At times we will incur significant losses with a young portfolio that is exposed to difficult markets.
“The realised and unrealised losses we have seen in this financial year reflect that and are not where we want to be.
“While these figures are painful for the bank, they are particularly so for the businesses which failed and of course for their teams.
“In a tough environment with tighter financial conditions, cautious sentiment and more challenging fundraising and exits, careful risk management and discipline remain central.
“We have learned a lot over the past five years and continue to improve and tighten our investment processes along with stricter criteria for potential investments as set out in our investment strategy.”
David Ritchie, the SNIB’s chief executive, said losses – while “regrettable and disappointing” – are “consistent with the mandate we hold, the risk we accept in the pursuit of impact and the macroeconomic conditions in which we are operating”.
“These results underline the importance of being explicit about the level of risk we take, why we take it, and the safeguards we apply when deploying public capital,” he said.
“The macroeconomic conditions in recent years have challenged the risk appetite and investment capacity of investors across the private and public sectors.
“This has restricted the capital available in the market for young companies, meaning that only the most competitive businesses will successfully raise capital.”
In the most recent financial year, M Squared Lasers Limited, R3 IoT Limited and Trojan Energy Limited all went under after being “unable to achieve a sustainable turnaround in performance”, while Orbital Express Launch Limited and PneumoWave Limited went into administration, with the process not complete by March 31.
A spokeswoman for the Scottish Government said: “Since launch five years ago, the bank has invested more than £1.2 billion, attracted a further £1.9bn of private investment and supported more than 3300 jobs across Scotland.
“These results reflect its role as Scotland’s mission-led development bank, and the nature of investing to deliver long-term economic, social and environmental benefits.
“The bank’s recent independent five-year review and Audit Scotland’s assessment both recognised the progress made in moving from establishment into delivery and the strong foundations that have been built for the future.
“We are considering the recommendations as part of work with the bank on its long-term funding. Any future approach would need to align with the bank’s missions and protect its operational independence.”
