A new bank lessor has moved into the agricultural equipment finance market in the UK.
AgriBank was founded and is owned by Frank Sekula and Matthew Smart, who both have over 20 years of experience in finance and agriculture, and will exclusively target the farming sector.
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Smart’s experience includes 12 years at Eastern Countries Finance (EFC), which will act as the initial broker for the bank while it establishes contacts with other agriculturally focussed introducers.
The bank will offer farmers leases and hire purchase agreements, both up to five-year terms, as well as secured loans and hopes to gain capital through customer deposits.
Sekula said: "We plan to operate a traditional banking model by taking deposits and lending them to farmers whom we know will pay them back."
He added: "UK farm borrowing rose by almost 9% last year according to the latest Bank of England figures, but farmers face a number of issues financing the purchase of machinery and equipment because many banks have reduced their allocation of capital to the sector."
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By GlobalDataING Lease, which financed a significant amount of agriculture equipment in the UK, pulled out of the market in November 2012, but Sekula told Leasing Life this did not directly influence the decision to launch AgriBank.
He said: "It was influenced by a general trend of lenders withdrawing from agricultural asset finance. ING was just another example."
"We founded AgriBank to reverse this trend and try to look after UK farmers and savers properly."
AgriBank is headquartered in Malta and holds a European banking license issued by the Malta Financial Services Authority (MFSA) and has been approved to offer banking services in the UK by the Financial Services Authority (FSA).
