UK's Close Brothers H1 profit falls as loan book shrinks

Close Brothers

17/03/2026 07:10

Overview

UK specialist banking group's H1 adjusted operating profit fell 19% on lower income

Loan book shrank 2% as company repositioned business and faced market headwinds

Company accelerated cost savings plan, now targeting £25 mln annualised savings in 2026

Outlook

Close Brothers now expects c.£25 mln annualised savings in 2026, up from c.£20 mln prior target

Company expects adjusted operating expenses to be c.£450 mln in 2026 financial year

Close Brothers continues to target loan book growth of 5-10% p.a. through the cycle

Result Drivers

LOWER LOAN BOOK - Co said adjusted operating income fell due to a lower average loan book, especially in Property, and repositioning including wind-downs in Novitas and Premium Finance personal lines

COST DISCIPLINE - Adjusted operating expenses were broadly flat as cost controls offset inflation and continued investment in technology

LOWER IMPAIRMENT LOSSES - Impairment charges declined, mainly due to updated IFRS 9 model for Motor Finance, partly offset by higher provisions in Property

Company press release: ID:nRSQ8713Wa

Key Details

Metric
Beat/Miss
Actual
Consensus Estimate
H1 Net Interest Income
GBP 274.40 mln
H1 Adjusted EBIT
GBP 65.20 mln
H1 CET1 Capital Ratio
14.30%
H1 Pretax Profit
-GBP 65.50 mln


Analyst Coverage

The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 5 "strong buy" or "buy", 4 "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 GBp530.00, about 48.2% above its March 16 closing price of GBp357.60

The stock recently traded at 7 times the next 12-month earnings vs. a P/E of 9 three months ago

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(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.)