For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20240125:nRSY8179Aa&default-theme=true
RNS Number : 8179A Secure Trust Bank PLC 25 January 2024
PRESS RELEASE
Secure Trust Bank PLC
LEI: 213800CXIBLC2TMIGI76
25 January 2024
For immediate release
SECURE TRUST BANK PLC
Pre-Close Trading Update
Net loan book grows 13.6%
Secure Trust Bank PLC ("Secure Trust Bank", "STB" or the "Group"), a leading
specialist lender, is pleased to announce its pre close trading update for the
fourth quarter ended 31 December 2023. The Group continues to trade in line
with management expectations, with a significant increase to year-on-year
underlying profits before tax and impairments.
Highlights
· Net lending grew by 13.6% in the year to £3.3bn, a significant
step towards our £4bn ambition as presented at our November 2023 Capital
Markets Day.
· All four specialist lending businesses delivered record levels of
new lending in 2023. Net interest margin was in line with H1 2023.
· The strong loan book growth led to an improvement in the cost
income ratio.
· We remain on track to deliver £5m in total annualised savings
from our cost optimisation programme in 2024.
Q4 2023 Q3 2023 Change Q4 2022 Change
Net lending £3,315.3 £3,212.2 3.2% £2,919.5 13.6%
New business lending £579.3 £578.7 0.1% £444.6 30.3%
Deposits £2,866.8 £2,717.1 5.5% £2,514.6 14.0%
Net lending
The customer loan book grew by 3.2% in the quarter and 13.6% compared to Q4
2022. All business areas recorded growth in the fourth quarter, notably with
Real Estate Finance growing by 3.1% following a flat third quarter and by
11.5% compared to Q4 2022. Consumer Lending grew by 3.2% in the quarter and by
18.4% compared to Q4 2022.
New business
Total new business lending was broadly flat in the quarter and increased 30.3%
compared to Q4 2022. Business Finance saw a 13.6% reduction on Q3 2023,
following a very strong third quarter for Commercial Finance, but still 287%
growth on Q4 2022. Consumer Finance recorded new business lending volumes of
£0.4bn in the quarter which reflects a 7.1% increase on Q3 2023 and a 2.3%
increase on Q4 2022.
Deposits
The Group has continued to attract deposits from a price competitive market.
Customer deposits were 5.5% higher at the end of the quarter and 14.0% higher
than Q4 2022.
Regulatory initiatives - Vehicle Finance
We note the FCA's recent announcement about discretionary motor finance
commissions. We operated some discretionary commission arrangements until
2017. From 2014 to 2017, a mid-single digit proportion of our new vehicle
finance loans included such arrangements. The FCA plans to set out its next
steps in Q3 2024, when the implications for the industry should become
clearer. We will provide further information to the market on these
developments as appropriate.
Separately, during H2 2023 we engaged in formal discussions with the FCA about
our collections processes, procedures and policies in Vehicle Finance. This
follows the FCA's review of Borrowers in Financial Difficulty (BiFD) across
the industry. We have engaged external support to assist us with this review
and, where necessary, are enhancing our approach. We currently expect the
review to conclude by the end of H1 2024.
David McCreadie, Chief Executive Officer, said:
"We have delivered another strong underlying performance in 2023 with
excellent progress made in growing our net lending balances and delivering
cost efficiency improvements. We have been operating in a challenging
economic environment for a prolonged period. Our business model has proven to
be resilient, and we have continued to make significant progress in delivering
our strategic plans.
"I am cautiously optimistic that inflation will continue to fall and that
stable lower interest rates will follow leading to a less volatile trading
environment. We remain focused on delivering positive outcomes for all of our
customers and delivering products and services that meet their needs."
Enquiries:
Secure Trust Bank PLC
David McCreadie, Chief Executive Officer
Rachel Lawrence, Chief Financial Officer
Phil Clark, Investor Relations
Tel: 0121 693 9100
Investec Bank plc (Joint Broker)
Bruce Garrow
David Anderson
Maria Gomez de Olea
Tel: +44 (0) 20 7597 5970
Shore Capital Stockbrokers (Joint Broker)
Mark Percy / Angus Murphy (Corporate Advisory)
Guy Wiehahn (Corporate Broking)
Tel: +44 (0)20 7408 4090
Camarco
Ed Gascoigne-Pees, Geoffrey Pelham-Lane, Sean Palmer
securetrustbank@camarco.co.uk (mailto:securetrustbank@camarco.co.uk)
Tel: 07591 760844
The person responsible for the release of this announcement on behalf of STB
is Mark Stevens, Company Secretary.
Forward looking statements
This announcement contains forward-looking statements about the business,
strategy and plans of STB and its current objectives, targets and expectations
relating to its future financial condition and performance. Statements that
are not historical facts, including statements about STB's or management's
beliefs and expectations, are forward-looking statements. By their nature,
forward-looking statements involve risk and uncertainty because they relate to
events and depend on circumstances that will occur in the future. STB's actual
future results may differ materially from the results expressed or implied in
these forward-looking statements as a result of a variety of factors. These
include economic and business conditions, risks from failure of clients,
customers and counterparties, market related risks including interest rate
risk, risks regarding market conditions outside STB's control, expected credit
losses in certain scenarios involving forward looking data, operational risks,
legal, regulatory, or governmental developments, and other factors. The
forward-looking statements contained in this announcement are made as of the
date of this announcement, and (except as required by law or regulation) STB
undertakes no obligation to update any of its forward-looking statements.
About STB
Secure Trust Bank is an established, well‐funded and capitalised UK retail
bank with a 71 year trading track record. Secure Trust Bank operates
principally from its head office in Solihull, West Midlands, and had 868
employees (full‐ time equivalent) as at 31 December 2023. The Group's
diversified lending portfolio currently focuses on two sectors:
(i) Business Finance through its Real Estate Finance and
Commercial Finance divisions,
(ii) Consumer Finance through its Vehicle Finance and
Retail Finance divisions.
Secure Trust Bank PLC is authorised by the Prudential Regulation Authority and
regulated by the Financial Conduct Authority and the Prudential Regulation
Authority.
Secure Trust Bank PLC, Yorke House, Arleston Way, Solihull, B90 4LH.
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
or visit
www.rns.com (http://www.rns.com/)
.
RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
. END TSTFLFERLDISFIS