leadf
logo-loader
viewSecure Trust Bank

Secure Trust Bank cashes in as profits rise just shy of 36%

The group reported an adjusted pre-tax profit of £36.7mln, up 35.9% on the prior year and in line with market expectations, helped by a 24.6% increase in customer deposits to £1.85bn

Piggy bank
As a result of the improved performance, STB upped its final dividend to 64p from 61p in 2017

Secure Trust Bank PLC (LON:STB) shares were on the up in late-morning on Thursday after it reported a profit rise of over a third in its latest full year.

The group reported an adjusted pre-tax profit of £36.7mln, up 35.9% on the prior year and in line with market expectations, helped by a 24.6% increase in customer deposits to £1.85bn and a 29.3% jump in customer numbers to 1.28mln.

READ: Secure Trust Bank expects 2018 results to be in line with expectations, but Peel Hunt downgrades on Brexit uncertainty

The group’s loan book had also surpassed the £2bn mark in the 12 months, a rise of 26.9% year-on-year.

As a result of the improved performance, STB upped its final dividend to 64p per share from 61p the year before, taking the total dividend to 83p from 79p.

The company’s chairman, former UK Scottish Secretary Lord Forsyth, said over the year, the company had reduced its exposure to “higher risk, higher margin consumer lending activities” in favour of lower risk lending which had delivered “a good set” of results.

“An uncertain economic environment creates risks that require careful navigation and this has influenced our risk appetite throughout 2018 and into 2019”, Forsyth said, adding that firm was “well positioned” to deliver progress in 2019 despite an “uncertain economic environment”.

The group said its trading in the early part of 2019 had been in line with its expectations.

Broker ups to ‘hold’

In a note to clients, analysts at broker Peel Hunt upgraded Secure Trust to ‘hold’ from ‘sell’ and hiked their target price to 1,300p from 1,100p, saying the profits had come in right around their own estimates of £35.2mln.

While the broker did say it was “cautious” on the potential effects of economic uncertainty on the bank's lending activity, there was also “a premium that could be assigned given the [mergers & acquisitions] activity in the UK lending space”.

Shares were up 6.2% at 1,360p.

Quick facts: Secure Trust Bank

Price: 656 GBX

AIM:STB
Market: AIM
Market Cap: £122.16 m
Follow

Add related topics to MyProactive

Create your account: sign up and get ahead on news and events

NO INVESTMENT ADVICE

The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is...

FOR OUR FULL DISCLAIMER CLICK HERE

Bango reports record revenue growth in the first half of 2020

Bango PLC's (LON:BGO) Paul Larbey talks to Proactive's Katie Pilbeam `about their latest record revenue growth in the first half of this year. Larbey is confident Bango is positioned to continue delivering growth after reporting revenues of £4.77mln, up 50% year-on-year. He goes on to...

2 days, 11 hours ago

2 min read