The Scottish National Investment Bank posted a net loss of £138m for the 2025-26 year, a result that centres on several early-stage failures and forces a rethink of its risk profile. The report records £65m of realised losses tied to three collapsed investments, M Squared Lasers, Trojan Energy and Krucial, and a further £85m of unrealised losses after Orbex and Pneumowave entered administration.
The bank nonetheless generated £32m of income, which covered its £20m operating costs and left day-to-day spending below budget. It also deployed a record £374m into Scottish ventures during the year, and since launch in 2020 has invested more than £1.2bn across 53 ventures while helping to secure £1.9bn in third-party funding.
Chairman Willie Watt, who has led the bank since its 2020 launch, acknowledged the scale of the setbacks. "The realised and unrealised losses we have seen in this financial year reflect that and are not where we want to be," he said, and added, "While these figures are painful for the bank, they are particularly so for the businesses which failed and of course for their teams." Watt pointed to tighter financial conditions and tougher fundraising as part of the backdrop, and said the bank will "learn" and tighten its investment processes and criteria as set out in its investment strategy.
Chief executive David Ritchie described the results as "regrettable and disappointing" and said he remained determined to show that a "commercially disciplined development bank can deliver for Scotland". An independent assessment by Sir John Elvidge anticipated roughly £110m of losses by the end of 2025-26 and stressed the importance of learning lessons from the setbacks, while not necessarily judging the scale outside reasonable expectations for a newly established institution.
The collapses carry concrete liabilities and consequences. M Squared entered administration in 2025 with debts of £64m. Trojan Energy folded with almost £30m of debt. Krucial also ceased operations last year. Orbex is set for liquidation with assets to be sold, and Pneumowave appointed liquidators in July.
Political reaction was immediate and divided. First Minister John Swinney said the bank must be able to take risks to deliver "greater economic returns" and to help build "an economy that is fit for the 21st Century". Scottish Labour called for examination of the losses and renewed focus on investments that deliver for communities. Reform UK and the Scottish Conservatives warned against what they described as taxpayer exposure and urged clearer accountability. The bank leaves investors, stakeholders and ministers to reconcile its record deployment with its pronounced capital losses, while management moves to tighten approvals and apply stricter investment standards going forward.
