9th Oct 2025 12:19
(Alliance News) - Secure Trust Bank PLC shares sank on Thursday as it warned of a hit to profit in 2025 after its net lending book declined by 4.1% in the third quarter to the end of September.
The Solihull, England-based business and consumer lender said the run-off of the non-core vehicle finance book quickened, combined with a "small decrease" in the core business.
However, it noted that the core business net lending balance grew by 10% year-on-year. Retail finance climbed by 9.1% and real estate finance was up by 13%.
Due to the performance of vehicle finance division, it now expects underlying pretax profit for 2025 to fall below market expectations by up to GBP9 million.
However, it said it is confident of around 30% growth on-year in underlying pretax profit.
Shares in Secure Trust Bank were down 19% at 978.00 pence in London on Thursday afternoon.
In July, the company said it would pivot its strategy away from vehicle finance to improve its return on average equity.
Therefore, it stopped new lending in the third quarter within its vehicle finance business, and put the existing book into run-off.
The vehicle finance business will be reported as a non-core activity going forward.
In the third quarter, the vehicle finance portfolio reduced "at a greater rate than anticipated", Secure Trust Bank said, which reduced expected full year income from that business.
It also incurred higher than expected impairment charges for the year so far.
Secure Trust Bank added that it expects the exit from vehicle finance to require "additional provisions for onerous supplier contracts associated with new business originations" which will be treated as exceptional costs.
The firm said the core business continues to trade in line with management expectations, while capital ratios "remain strong".
By Michael Hennessey, Alliance News reporter
Comments and questions to [email protected]
Copyright 2025 Alliance News Ltd. All Rights Reserved.
Related Shares:
Secure Trust