Close Brothers declares an interim dividend of 22.5p (H1 2022: 22.0p), reflecting their underlying performance and the Board's confidence in the group's outlook. The group's policy aims to provide sustainable dividend growth year-on-year, while maintaining a prudent level of dividend cover. The interim dividend is due to be paid on 26 April 2023 to shareholders on the register at 24 March 2023.
Other Financial Highlights:
- Steps have been taken to resolve the issues surrounding Novitas, resulting in an additional provision of £89.8 million, with the total provisions in relation to Novitas taken in H1 2023 at £114.6 million. As a result, statutory operating profit before tax decreased to £11.7 million (H1 2022: £128.9 million). Excluding Novitas, adjusted operating profit decreased to £117.5 million (H1 2022: £160.5 million)
- Achieved 5% income growth in Banking with a net interest margin of 8.0% (H1 2022: 7.9%) and good levels of customer demand, particularly in Commercial. As a result, pre-provisions, adjusted operating profit in Banking increased 5% to £177.2 million (H1 2022: £168.5 million)
- Although underlying credit performance remains resilient, the increased uncertainty in the economic outlook has been reflected in higher forward-looking impairment provisions and a rise in arrears in Motor Finance. As a result, the annualised bad debt ratio (excluding Novitas) was 1.1% (H1 2022: 0.2%)
- The loan book excluding Novitas was £9.0 billion (31 July 2022: £8.9 billion), as the group remains committed to lending consistently to their customers under responsible terms in all market conditions
- Delivered healthy net inflows of 6%, with a strong contribution from new hires, as they continued to focus on growing Close Brothers Asset Management ("CBAM")
- Winterflood's performance continued to reflect challenging market conditions
- Total funding increased 3% to £11.9 billion (31 July 2022: £11.6 billion), as the diversity of their funding sources helped us optimise funding costs in an environment of rapid interest rate rises
- Common Equity Tier 1 ("CET1") ratio was 14.0% at 31 January 2023 (31 July 2022: 14.6%), significantly above the applicable minimum
