The ambition, spanning from January 2024 to the end of 2026, aims to support local housing authorities and associations in delivering and maintaining affordable homes as well as improve living conditions in existing properties, thus improving the availability and quality of social housing in Scotland.

Alongside the construction of new properties, this lending could also help housing associations finance energy efficiency and environmental solutions, such as retrofits.

Robert Begbie, CEO, commercial & institutional banking, NatWest Group said: “We are proud to be a major lender to the UK social housing sector, which continues to deal with multiple priorities such as the demand for new and upgraded housing, and the critical challenges of energy efficiency, fire and tenant safety.

“In 2023, we completed nearly £3bn of new funding to help more people and families have access to housing. We support around 200 housing associations across the UK, and are proud to announce our ambition to provide a further £5bn in funding to support the housing association sector by the end of 2026.”

This announcement is the bank’s latest signal of support to the housing association sector. In February 2021, the bank issued a €1 billion (around £860 million) affordable housing social bond, the first of its kind by a UK bank, using the bond proceeds to finance or refinance loans to not-for-profit registered housing associations operating in the UK.

RBS has also helped deliver for the sector in Scotland. The bank delivered a £96m loan to Aberdeen-based Grampian Housing Association (GHA) to finance the development of 1,000 new sustainable homes in the region. The loan provides GHA with the necessary flexibility to continue supporting its communities and tenants, where it currently provides services to over 4,000 households.

The bank also delivered a £10m loan to Trust Housing Association to help them provide affordable, energy efficient homes for tenants across the country, from Stornoway to Stranraer.

First established in 1973, Trust has a portfolio of over 3,700 properties across 23 local authority areas and over 700 staff members. The funding deal will enable Trust to continue to invest in local communities through the provision of affordable, sustainable new build properties, as well as retrofitting its existing homes to increase energy efficiency and help alleviate pressures for tenants throughout the cost-of-living crisis.

The bank has also deepened its work with The Royal Foundation’s Homewards programme, whose aim is to prevent and end homelessness.

The programme has identified the need to unlock more housing, and an important element of that is increased lending from bank focussed on social housing. With collaboration at the centre of Homewards’ mission, RBS is actively engaging with the programme to explore how it can offer support and expertise to help prevent homelessness.

Homewards works in six flagship locations (Aberdeen, Northern Ireland, Bournemouth, Christchurch and Poole, Sheffield, Newport and Lambeth), and through its work with the bank’s regional boards across the UK, and at a national level, the bank is exploring a response, in a collective effort to help prevent homelessness in these areas across the next five years.