22nd May 2019 09:14
LONDON (Alliance News) - Close Brothers Group PLC said Wednesday its delivered a "solid" performance in the third quarter, with the merchant banking group's Banking division performing "as expected" in the current market conditions.
The FTSE 250-listed bank noted, however, its market facing business struggled with "continued lower activity levels" in the three month period from February 1 to April 30.
Close Brothers said its loan book increased 1.4% in the quarter, rising to GBP7.5 billion from GBP7.4 billion at January 31. The merchant banker said this was driven by Commercial & Property lending, which is up 3.6% year to date.
"The bad debt ratio has remained low with continued strong credit performance across the business, and the net interest margin year to date has remained broadly in line with the 2018 financial year," added Close Brothers.
The merchant banker's net interest margin in the financial year ended July 31 was 8.0%.
Within its Banking division, Close Brothers said it remained focused on maintaining its margins and "prudent" underwriting. Close Brothers also noted it has continued to invest in the business.
Close Brothers' Asset Management division's managed assets at April 30 stood at GBP10.9 billion, 5.8% higher than the GBP10.3 billion seen at January 31. The company said it continued to invest in "people and technology" to support long-term growth.
The growth, despite the lowered activity levels, was on positive market movements and continued net inflows, Close Brothers said.
Close Brother said its stockbroking arm Winterflood Securities continued its focus on "maximising trading opportunities". "Although trading volumes remained low, the division delivered solid profitability in the quarter, performing broadly in line with the first half," Close Brother added.
The merchant banking group said it expects a "solid" full financial year.
Shares in Close Brothers were down 1.1% Wednesday morning at 1,476.00 pence each.
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