The Scottish National Investment Bank (SNIB) is being undermined by “SNP economic incompetence”, it has been declared.

Scottish Labour economy spokesperson Daniel Johnson was responding to new accounts from the state-funded development bank published on Tuesday, which revealed the institution had made a loss of £14.6 million for the year ended March 31.

The accounts reflected the loss of the bank’s £8m investment in Circularity Scotland, the company set up to operate Scotland’s failed deposit return scheme. Circularity Scotland fell into administration in June last year after the SNP-Green administration kicked the DRS into the long grass after its introduction was stymied by the UK Government, which came amid mounting concern over its costs and complexity.

READ MORE: 'I am really excited that we are starting to hit our stride'

Despite reporting a loss, the accounts for the SNIB showed that investment income had increased by 80% to £19.3m. Income at the bank exceeded its operating expenses for the first time.

Mr Johnson said: “The Scottish National Investment Bank is a key part of driving growth in Scotland, but these accounts make it clear that it is being financially hobbled by SNP-Green incompetence.

“The figures clearly show that the fall-out over the deposit return scheme has blown an £8m hole in the bank’s finances – allowing less and less money to be spent on stimulating economic growth and activity.

“The simple fact is that the investment bank is being held back by SNP economic incompetence, leaving Scotland’s economy underpowered and under-resourced.

READ MORE: What does scrapping £720m deal say about housebuilding?

“A Scottish Labour government would put economic growth front and centre and ensure that the public purse is protected from the costly fallout of government failure.”

Speaking to The Herald on Tuesday, SNIB chief executive Al Denholm declared the bank was in “good shape”.

“We are moving from start-up, beginning to mature and becoming an increasingly established organisation,” he said. “For example, our income was up 80% to £19m, so in the 2023/ 2024 year we covered our cost base which was £16m, so that was positive.

“Clearly, as the portfolio grows that income should continue to grow, so hopefully it is a sign of things to come. Last year, we committed £225m to Scottish businesses and projects, which is very beneficial, and in that year we managed to bring in £400m of private capital alongside us.

READ MORE: Shares in BT surge after Gleneagles owner buys 24.5% stake

“If you look at it as a total, the last three years, we are now at £640m, £650m of capital committed, with about £1bn of third-party capital coming alongside us.”

Mr Denholm defended the bank’s processes when asked if it had changed its approach after the loss it incurred on its investment in Circularity Scotland. He reviewed the investment and found he was “personally comfortable” with the due diligence that had been carried out, stating that it had been “robust” and “well-considered”.

“It was the kind of due diligence I would expect of any institutional investor, so I wouldn’t necessarily say that we have had to change anything as a result of that, because our processes are robust," he said.

Despite recording a loss, the accounts show Mr Denholm’s pay package for the period from joining on May 1, 2023, and March 31, 2024, was worth £335,302. This includes £220,000 of salary and £88,902 under a long-term incentive plan. He is paid an annual salary of £240,000.