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July 17, 2019

Arbuthnot doubles H1 profits with new mortgage purchase

By Oliver Williams

Arbuthnot Banking Group, the holding company of British private bank Arbuthnot Latham has announced half-yearly profits before tax of £2.9 million, over double last year’s figure of £1.2 million.

Arbuthnot Latham owns and operates Arbuthnot Commercial Banking and Renaissance Asset Finance, which it acquired in 2017.

The Group recorded an increase in customer loans of 16% and customer deposits of 18% in the first half of 2018. This is largely due to the Commercial Bank picking up loan requests of the private bank.

“The lending activities have migrated toward the Commercial Bank that contains specialist lenders better placed to underwrite the lending,” Arbuthnot Banking Group said in its H1 results.

The Group also announced the purchase of a residential mortgage portfolio earlier in July, worth approximately £266m in loan balances. The transaction is expected to complete on 8 August 2019.

Sir Henry Angest, chairman and chief executive of Arbuthnot, said the transaction, “should help to improve the returns of the Group.

“We have raised new capital, grown our existing businesses and continued to deliver on our plans to diversify”.

Additionally, Arbuthnot’s private banking unit has seen an increase in new clients. “The level of new private clients joining the Bank has increased by 13% compared to the prior year, which has led to an increase in deposits balances to £1.04bn,” its results stated.

Despite this, assets under management at the Group decreased by 4% to £1,029m in the six months to 30 June 2019.

Arbuthnot also recognised a net loss of £25.7m on derecognition of the Secure Trust Bank, which has been treated as a discontinued activity. Arbuthnot previously held a 15.5% shareholding in Secure Trust Bank PLC.

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