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Close Brothers loan book rises, inflows strong
FTSE 250 merchant bank Close Brothers reported a rise in its loan book on Thursday and said it remained well placed for the full 2018 financial year, as it announced the departure of its finance director.
In the an update for the five months to 31 December 2017, the company said its loan book was up 2.6%, while year-on-year it gained 7.3% to £7.1bn, driven by the premium and property finance businesses.
In Motor and Asset Finance the environment remains competitive and Close said it continues to focus on maintaining its underwriting and pricing discipline. In the asset management business, the group saw "strong" net inflows and benefited from rising markets.
Close Brothers said its performance since the start of the financial year has "remained good", with all three divisions ahead of expectations. Managed assets increased 8.2% in the period to £9.6bn and total client assets rose to £11.7bn from £11.2bn at 31 July.
The banking division has continued to generate "strong" returns and profit growth during the period, with a stable net interest margin, while bad debts remained low and the underlying credit performance was consistent with the last financial year.
Meanwhile, the securities business, Winterflood, continued its good performance with trading activity remaining high.
"Given our performance year to date, we are confident of delivering an increase in profit in the first half, and remain well positioned for the full 2018 financial year."
Also on Thursday, Close Bros announced that FD Jonathan Howell will step down from his role after ten years as he pursues the next stage of his career. He will stay on as FD and as a member of the group Executive Committee and board of directors until the annual general meeting in November 2018.
Chief executive Preben Prebensen said: "Jonathan has made a very substantial contribution during a period of significant growth and development, driving the group's financial strategy and bringing sound judgement and a sharp focus on shareholder value. On behalf of the board I would like to thank Jonathan for his dedication and leadership over many years and wish him all the best for the future."