REG - Secure Trust BankArbuthnot Banking - Final Results <Origin Href="QuoteRef">ARBB.L</Origin> <Origin Href="QuoteRef">STBS.L</Origin> - Part 6
19/03/2015 07:01
- Part 6: For the preceding part double click ID:nRSS8407He
At 31 December 2013 - 0.5 0.5
At 31 December 2014 2.7 1.0 3.7
The Group's opening freehold property is the Registered Office of the Company and is fully utilised for the Group's own
purposes. During the year, the Company acquired a further freehold property, Secure Trust House, Boston Drive, Bourne End
SL8 5YS. The majority of this property will be used for the Group's own purposes, however the existing tenant of the
property has remained in situ. The cost of the property was £2.7 million.
The directors have assessed the value of the Group's freehold property at the year end through comparison to current rental
yields on similar properties in the same area and do not believe that the fair value of freehold property is materially
different from its carrying value.
The carrying value of freehold land which is included in the total carrying value of freehold land and buildings and which
is not depreciated is £1.7 million (2013: £0.5 million).
The historical cost of freehold property included at valuation is as follows:
2014 2013
£million £million
Cost 7.5 4.8
Accumulated depreciation (1.2) (1.1)
Net book amount 6.3 3.7
19. Derivative financial instruments
In order to protect its floating rate deposit book from increases in Bank of England base rates above 1.5%, the Group
entered into an interest rate cap on 30 June 2011, with a notional amount of £20 million and a maturity date of 30 June
2015. The losses recognised in other comprehensive income in relation to the interest rate cap previously are not expected
to be recovered in future periods, therefore they have been transferred to profit or loss during the year.
2014 2013
Contract/ notional amount Fair value assets Fair value liabilities Contract/ notional amount Fair value assets Fair value liabilities
Group and Company £million £million £million - £million £million £million
Interest rate cap held in qualifying hedge relationships 20.0 - - 20.0 - -
20.0 - - 20.0 - -
Moody's long term ratings:
2014 2013
Contract amount: £million £million
A2 20.0 20.0
20.0 20.0
20. Other assets
2014 2013
Group £million £million
Trade receivables 0.9 0.6
Amounts due from related companies 0.8 4.1
Prepayments and accrued income 3.5 3.4
5.2 8.1
2014 2013
Company £million £million
Trade receivables 0.6 0.1
Amounts due from related companies 114.6 99.9
Prepayments and accrued income 1.0 1.0
116.2 101.0
21. Due to banks
2014 2013
Group and Company £million £million
Amounts due to related companies - 0.1
Amounts due to other credit institutions 15.9 -
15.9 0.1
Amounts due to banks for the current year represent monies arising from the sale and repurchase of drawings under the
Funding for Lending Scheme. These are due for repayment in March 2015.
22. Deposits from customers
2014 2013
Group and Company £million £million
Current/demand accounts 37.8 36.4
Term deposits 570.6 400.2
608.4 436.6
For a maturity profile of deposits from customers, refer to Note 3.
23. Other liabilities
2014 2013
Group £million £million
Trade payables 10.9 9.8
Amounts due to related companies 0.3 2.2
Accruals and deferred income 18.3 13.8
29.5 25.8
2014 2013
Company £million £million
Trade payables 4.2 3.3
Amounts due to related companies 4.6 2.2
Accruals and deferred income 13.4 10.0
22.2 15.5
Within Group trade payables at 31 December 2014 there is £4.3 million (2013: £4.3 million) collateral held from RentSmart.
The Group buys assets which are then leased to customers of RentSmart and the Group pays RentSmart a commission, which is
recognised within operating income. In return, RentSmart continues to operate the agreement, retains the credit risk and
provides the Group with a collateral amount that is based upon the balance of customer receivables and expected new
agreements during the following month.
Within Group and Company accruals and deferred income there is £6.6 million relating to accrued interest payable (2013:
£5.1 million).
Financial Services Compensation Scheme Levy
In common with all regulated UK deposit takers, the Company pays levies to the Financial Services Compensation Scheme
('FSCS') to enable the FSCS to meet claims against it. The FSCS levy consists of two parts: a management expenses levy and
a more significant compensation levy. The management expenses levy covers the costs of running the scheme and the
compensation levy covers the amount of compensation and associated interest the scheme pays, net of any recoveries it makes
using the rights that have been assigned to it.
During 2008 and 2009 claims were triggered against the FSCS in relation to Bradford & Bingley plc, Kaupthing Singer and
Friedlander Limited, Heritable Bank Plc, Landsbanki Islands hf, London Scottish Bank plc and Dunfermline Building Society.
The FSCS meets these current claims by way of loans it received from HM Treasury. The terms of these loans were interest
only for the first three scheme years, up until March 2013, and the FSCS recovered the interest cost by way of levies on
members over this period.
The Company's FSCS provision reflects market participation up to the reporting date and the accrual of £0.1 million relates
to the interest levy for the scheme year 2014/15 which is payable in September 2015. This amount was calculated on the
basis of the Company's share of protected deposits and the FSCS's estimate of total interest levies payable for each scheme
year. The loan repayment relating to the scheme year 2014/15 was paid by the Company in September 2014.
24. Deferred taxation
2014 2013
Group £million £million
Deferred tax liabilities:
Unrealised surplus on revaluation of freehold property 0.2 0.2
Other short term timing differences (0.2) (0.6)
Deferred tax liabilities - (0.4)
Deferred tax assets:
Carried forward losses 1.0 1.9
Deferred tax assets 1.0 1.9
Deferred tax liabilities:
At 1 January (0.4) (1.2)
Arising on acquisition of subsidiary undertaking - (1.0)
Profit and loss account 0.4 1.8
At 31 December - (0.4)
Deferred tax assets:
At 1 January 1.9 5.1
Profit and loss account (0.8) (3.0)
Losses utilised through group relief during the year - (0.2)
Cash flow hedges (0.1) -
At 31 December 1.0 1.9
2014 2013
Company £million £million
Accelerated capital allowances and other short-term timing differences 0.3 0.7
Cash flow hedges - 0.1
Deferred tax assets 0.3 0.8
At 1 January 0.8 0.6
Arising on acquisition of subsidiary undertaking - 0.2
Profit and loss account - accelerated capital allowances and other short-term timing differences (0.4) -
Cash flow hedges (0.1) -
Deferred tax assets at 31 December 0.3 0.8
On 2 July 2013 the Government substantively enacted a reduction in the main rate of UK corporation tax from 21% to 20% with
effect from 1 April 2015. This will reduce the Group's future current tax charge accordingly. Deferred tax has been
calculated based on the enacted rates to the extent that the related temporary or timing differences are expected to
reverse in the future periods.
25. Contingent liabilities and commitments
Capital commitments
At 31 December 2014, the Group had £0.1 million of capital commitments relating to the refurbishment of an Everyday Loans
branch. The Company had no capital commitments (2013: £nil).
Credit commitments
At 31 December 2014, the Group and Company both had commitments of £96.0 million to extend credit to customers (2013: £6.6
million and £6.6 million respectively).
Operating lease commitments
The future aggregate lease payments for non-cancellable operating leases are as follows:
2014 2013
Land and Buildings Other Land and Buildings Other
Group £million £million £million £million
Within 1 year 0.8 0.3 0.8 0.4
Between 1 year and 5 years 1.5 0.2 1.6 0.2
Over 5 years 0.1 - 0.1 -
2.4 0.5 2.5 0.6
2014 2013
Land and Buildings Other Land and Buildings Other
Company £million £million £million £million
Within 1 year - 0.3 - 0.4
Between 1 year and 5 years - 0.1 - 0.2
Over 5 years 0.4 - 0.4 -
0.4 0.4 0.4 0.6
There are 35 leases classified as land and buildings in the group (2013: 36). Other leases include motor vehicles and computer hardware.
Other commitments
At 31 December 2014 a commitment exists to make further payments with regard to the Financial Services Compensation Scheme
Levy for 2015 and thereafter. Due to uncertainties regarding the elements in the calculation of the levy and the Group's
share thereof, the directors consider this cost to be unquantifiable.
26. Share capital
Number of shares Ordinary shares
£million
At 1 January 2013 15,648,149 6.3
At 31 December 2013 15,648,149 6.3
Shares issued during year 2,543,745 1.0
At 31 December 2014 18,191,894 7.3
On 8 July 2014 an additional 2,083,333 ordinary shares were issued by the Company, at a price of 2400 pence each, raising
gross proceeds of £50 million.
On 3 November 2014 an additional 460,412 ordinary shares were issued by the Company following the exercise of share
options, at a price of 720 pence each, raising gross proceeds of £3.3 million.
27. Share based payments
On 17 October 2011, the Group established the Share Option Scheme (SOS) entitling three directors and certain senior
employees to purchase shares in the Company.
The performance conditions of the Scheme are that for the duration of the vesting period, the dividends paid by the Company
must have increased in percentage terms when compared to an assumed dividend of £8 million in respect of the financial year
ending 31 December 2012, by a minimum of the higher of the increase in the Retail Prices Index during that period or 5% per
annum.
All dividends paid by the Company each year during the vesting period must be paid from the Company's earnings referable to
that year. Also from the grant date to the date the Option is exercised, there must be no public criticism by any
regulatory authority on the operation of the Company or any of its subsidiaries which has a material impact on the buRecent news on Arbuthnot Banking
See all newsREG - Arbuthnot Banking - Audited Final Results
AnnouncementREG - Arbuthnot Banking - Pre Close Trading Update
AnnouncementREG - Arbuthnot Banking - Director/PDMR Shareholding
AnnouncementREG - Arbuthnot Banking - Renewal of Tier 2 Regulatory Capital Loan facility
AnnouncementREG - Arbuthnot Banking - Director/PDMR Shareholding
Announcement