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Arbuthnot Banking Group PLC on Tuesday reported a sharp rise in interim profit as the lender enjoyed the tailwinds from rising interest rates in the UK.
In the six months to June 30, the London-based private bank recorded pretax profit of £3.4 million, up from £3.0 million in the same period the year prior.
Operating income surged to £52.6 million from £41.4 million, as net interest income rose to £42.5 million from £29.9 million.
‘The improvement in the profitability comes from continued growth and diversification of our lending balances and now also significantly from the increase in base rates. In the months of May and June the group achieved underlying profitability of more than £2.0 million per month,’ the bank explained.
Arbuthnot declared an interim dividend of 17 pence, rising from 16p a year earlier.
The lender ended the first half with a CET1 ratio of 11.4%, down from 12.3% at December 31.
Current loans topped out at £2.1 billion, up from £1.9 billion at the same point the year before and £2.0 billion at the end of 2021.
It ended the half with assets under management of £1.30 billion, up from £1.22 billion a year prior but down from £1.36 billion from six months ago.
Henry Angest, chair and chief executive, said: ‘During the first half of 2022 the group has seen a marked improvement in underlying profitability as a result of the rising interest rate environment.
‘Given our low cost and stable relationship-based deposits, the group is well positioned to continue to fund the diverse lending businesses and maintain good margins as it builds towards delivering our 'future state' plan.’
Shares in Arbuthnot Banking were up 2.1% in London on Tuesday afternoon at 855.00 pence each.
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