By Anthony O. Goriainoff
Close Brothers Group PLC said on Friday it performed well in the third quarter and while it did not see a direct effect from current economic conditions on customers, its bad debt ratio since the start of the year rose slightly to 1.2%.
The UK merchant banking group said it was an acknowledgment of “higher IFRS 9 requirements to reflect the cautious outlook for the external environment”.
The company said that in the period to April 30, its loan portfolio grew by 1.8% with strong margins within the banking division to 8.8 billion pounds (10.98 billion dollars) compared to £8.6 billion in January. Close Brothers said this was due to continued good new business volumes in its commercial and auto finance segments.
The company said client assets declined in the asset management division and that reflected negative market movements, but its Winterflood Securities business saw improved trading revenue.
The company’s common equity Tier 1 ratio — a key measure of balance sheet strength — as of April 30 was 14.9%, he said.
“In an environment of rising inflation and heightened uncertainty, our proven and resilient model, strong financial position and deep expertise position us well to continue to support our clients and clients,” the company said. .
Shares at 0720 GMT were up 22 pence, or 2.1%, at 1,093 pence.
Write to Anthony O. Goriainoff at [email protected]