Close Brothers FY 2026 adjusted profit falls; not paying annual dividend
Close Brothers FY 2026 adjusted profit falls; not paying annual dividend
Overview
UK specialist bank's preliminary FY 2026 adjusted operating profit fell 17% as income declined
Adjusted EPS for FY 2026 declined, with loan book flat but growth in H2
Company will not pay a final dividend due to uncertainty over motor finance redress
Outlook
Close Brothers expects FY 2027 underlying loan book growth of 5-10%, subject to market conditions
Company forecasts FY 2027 adjusted operating expenses of about £430 mln
Close Brothers targets double-digit RoTE by FY 2028, rising thereafter
Result Drivers
BUSINESS REPOSITIONING - Co said lower income and profit reflected the repositioning of its business and prevailing market conditions
COST SAVINGS - Accelerated cost initiatives delivered c.£36 mln of annualised savings, ahead of target, supporting lower expenses
LOAN BOOK MOMENTUM - Loan book was flat; Underlying loan book grew 2% YoY and 4% in H2, with all divisions growing in Q4, offsetting earlier declines
Company press release: ID:nRSc6596Wa
Key Details
Metric | Beat/Miss | Actual | Consensus Estimate |
FY Net Interest Income |
| GBP 538.50 mln |
|
FY Adjusted EBIT |
| GBP 120.30 mln |
|
FY CET1 Capital Ratio |
| 14.1% |
|
FY Pretax Loss |
| GBP 60.30 mln |
|
Analyst Coverage
The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 4 "strong buy" or "buy", 3 "hold" and no "sell" or "strong sell"
The average consensus recommendation for the banks peer group is "buy"
Wall Street's median 12-month price target for Close Brothers Group PLC is GBp512.50, about 32.8% above its September 28 closing price of GBp386.00
The stock recently traded at 7 times the next 12-month earnings vs. a P/E of 8 three months ago
Reuters Recommended Reads
Sept 28 - Bank of England's Ramsden happy with market reaction to multi-year bond sale plans
Sept 28 - UK finance minister says 'fiscal discipline' will form core of budget
Sept 28 - UK's Tullow Oil half-year net loss widens on one-off refinancing fees
For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact reuters.support@thomsonreuters.com.
(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)