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City man hears word of God

CITY financier James Odgers has taken the words of God in Exodus, 22:25 to heart: "If thou lend money to any of my people that is poor by thee, thou shalt not be to him as an usurer."

After two decades in the Square Mile, most recently as a founding director of the Intermediate Capital Group, Mr Odgers has finished with its godless ways and responded to a higher calling, the establishment of a Christian bank.

In doing so, he hopes to take finance back to its roots in Biblical days, when it was a way for members of small communities to help each other and the main form of security was trust.

Mr Odgers' Christian bank will not be the first set up for good causes in Britain. As far back as 1974, Mercury Provident, now merged with Holland's Triodos Bank, was set up to finance ethical projects. It allowed depositors to choose where their money would be invested and set their own interest rates from zero to 7 per cent.

It will not be the first time, though, that Mr Odgers has put his beliefs into action. A devout Anglican, he has already founded a small charity, the Besom Foundation, which operates from the garage at the bottom of his garden, providing finance to people in Third World countries.

It is from his experience of similar bodies that he is drawing his inspiration for the new institution. "Quite a few of the more successful micro-enterprise schemes depend on trust. And their default rates are very low compared with here."

Finance in Britain used to run on similar lines, with regional banks, mutual societies and credit unions relying on their knowledge of their customers' characters.

"As the need for larger amounts of capital has risen, so the amount that is raised from providers who don't know the borrowers has increased," Mr Odgers said.

The exact form of his bank has yet to be determined. "It's still at the seedling stage in my mind." His research will include looking at how other religions, such as Judaism and Islam, approach finance.

The result is likely to be an institution that provides finance to small businesses, possibly only those run by fellow Christians. It will probably be based around an existing community, so that the lenders and borrowers can know and trust each other. Like Intermediate, which provided mezzanine finance - a half-way house between debt and equity - the new institution probably will not make conventional loans.

"I'd be surprised if it were to charge or pay interest. It would be more to do with sharing the profits of the venture concerned," Mr Odgers said.