Manx Financial (LON:MFX) Market Cap 11.4 million
Share Price (10.75 – 11.50) Spread 7.1%
(Disclosure - Small Long Position Recently Acquired)
“Manx Financial Group PLCis the holding company of a diversified financial services group which offers retail and commercial banking services, payment solutions, foreign exchange, money saving solutions, wealth management, general insurance and life insurance through its subsidiaries.”
Source MFX website
What tweaked my initial enthusiasm was a short article I read on Isle of Man quoted stocks. There are not that many quoted stocks, but one mentioned was Manx Financial Group. I looked into this company a little further and was initially impressed with the headlines below for me to do some follow-up research.
Financial Highlights (for the year ended 31st December 2014)
- Profit before tax: £1.7million - up 61% (2013: £1.1million)
- Net interest income: £10.8 million - up 31% (2013: £8.3 million)
- Loans: £89.3 million - up 18% (2013: £75.8 million)
- Total assets: £119.5 million - up 28% (2013: £93.7 million)
- Customer accounts: £100.3 million - up 28% (2013: £78.1 million)
On closer examination of the accounts, the high 61% PBT warranted closer examination. Small changes in accounting treatment can flatter results. The more reliable news was that customer deposit accounts were up by 28% on top of an increase the previous year. Loans up 18% as well. Good increases in lending should see nice future profit increases. Loans are matched comfortably against deposits held.
Manx Financial Group is a tiny player in the financial sector on the small island of Isle of Man. Being small and nimble, the increasing digitalisation of services may allow it to compete in areas where the company believes are currently under served on the island.
The company is investing about 300K in technology annually and sees opportunities to expand and improve on digital banking services currently offered. In 2014 the company entered two new businesses, the finance and foreign exchange broking market which the company expects to make a positive contribution to profits.
The jewel in the group is Conister bank. Deposits held by Conister bank now account for 1% of deposits held on the island. The growth in deposit has certainly picked up in recent years.
Against that Manx Financial Group has been listed on AIM for last 20…
