TOWN Hall chiefs have defended the council’s £30 million investment into Redwood Bank after concerns were raised over the amount it has paid for shares.

The Labour-run authority paid around £30 million to buy a 33 per cent share in Redwood Bank.

But Cllr Ryan Bate (LD – Grappenhall) has raised questions over the controversial investment.

He says Freedom of Information requests conducted by one of his residents have ‘brought to light the concerns’ of the council’s auditor, Grant Thornton.

Cllr Bate added: “Covid-19 has sent a tidal wave through the economy and this will have impacted the council’s finances.

“In light of the pandemic’s impact, the council must address ongoing concerns around its investment strategy and, in particular, its holding in Redwood Bank.

“There are outstanding questions on the justification for the price which Warrington Council paid for its share in the bank.

“The publicly released information suggests that it paid in the region of twelve times more per share compared to its partners.

“I understand the need for commercial confidentiality but the council needs to be much more open and transparent, not least with its own auditors.

“The council needs to tell the public and opposition parties exactly where our investments now stand so that we can try to work through this together.

“What is the current value of the investment in Redwood Bank?

“We also need clarification about when the accounts for 2017/18 and 2018/19 are going to be signed off.”

But the council says it remains pleased with the performance of its long-term investments, including Redwood Bank.

“We are confident in our share in Redwood Bank,” said a spokesman.

“The cost of shares can fluctuate due to changes in market value.

“In short for example, a 1p share is not worth just 1p – and is dependent on a range of factors.

“By investing in shares in Redwood Bank, the council has already supported a number of SMEs and we are confident this is a sound investment – as shown throughout our rigorous due diligence processes.

“The valuation of a bank is complex matter and is normally guided by the current market view.

“The estimated market value of a bank is subject to detailed analysis and is very much subjective.

“For example, market analysis would take into consideration that while normally loss-making over the first few years, a new bank is generally considered to have additional value or worth, due to the fact that the company has been granted a banking licence by the regulators.

“This level of detailed analysis is applied to Redwood Bank, as with any other bank.”