Merchant banking group Close Brothers said on Wednesday that its trading performance had been strong during the 11 months ended 30 June, with high levels of activity in its banking unit, good net inflows in the firm’s asset management division and strong trading income in its Winterflood subsidiary.
Close Brothers stated that in its banking wing, loan books increased 9.6% to £8.3bn, with the group continuing to see “significant business volumes” following its third-quarter trading update. Annualised net interest margins remained broadly stable year-on-year at around 7.5%, while its annualised bad debt ratio was “reduced slightly” from 2020’s figure of 1.3% during the first half of the trading year.
Close Brothers Asset Management generated annualised net inflows of 7%, up from 6% on 30 April, despite the continued impact of reduced face-to-face interaction with clients as a result of the ongoing Covid-19 pandemic, while managed assets increased to £15.3bn when including favourable market movements and total client assets increased to £16.4bn
The FTSE 250-listed firm’s Winterflood unit benefited from “elevated market activity” for most of the year, although it also noted it had seen “a moderation in trading volumes” since its third-quarter trading update.
Chief executive officer Adrian Sainsbury said: “We have navigated the changing environment well and our model has enabled us to perform strongly, making the most of opportunities, throughout the year. We are encouraged by improvements in the economic backdrop, although uncertainties persist.
“I am confident that our proven and resilient model, together with the expertise of our people, leave us well placed to continue supporting our customers and clients and to protect, grow and sustain our business over the long term.”
As of 0905 BST, Close Bros shares were up 1.82% at 1,512.0p.
