Secure Trust Bank (STB) put its entrance into the residential mortgage market on hold during the first half of the year, fearing the outcome of the EU referendum could dampen property prices. As part of management's defensive positioning of the bank's loan book, it limited loans to residential housebuilders so that they should not exceed 60 per cent of the gross development value. In central London it is not looking to write loans for properties exceeding 50 per cent of this measure.
With the disposal of consumer finance business Everyday Loans to Non-Standard Finance (NSF) and the running down of its OneBill bank account book, Secure Trust is now much more focused on specialist finance. In real estate finance lending balances increased by a third year on year to £362m, while point-of-sale finance, used by in-store and online shoppers, enjoyed the biggest growth at 66 per cent to £272m.
Total customer deposits increased by a quarter to £1.04bn. The alternative lender also increased the proportion of fixed-rate, fixed-term funding to guard against a liquidity squeeze following the referendum.
Analysts at Peel Hunt expect net tangible assets per share of 1,265p at the end of December 2016, rising to 1,460p a year later.
SECURE TRUST BANK (STB) | ||||
|---|---|---|---|---|
| ORD PRICE: | 2,025p | MARKET VALUE: | £369m | |
| TOUCH: | 2,003-2,025p | 12-MONTH HIGH: | 3,171p | 1,550p |
| DIVIDEND YIELD: | 3.6% | PE RATIO: | 17 | |
| NET ASSET VALUE: | 1,255p | LEVERAGE: | 6 | |
| Half-year to 30 Jun | Total operating income (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2015 | 42.8 | 10.4 | 46 | 17 |
| 2016 | 57.3 | 12.5 | 57 | 17* |
| % change | +34 | +20 | +23 | - |
Ex-div: 25 Aug Payment: 23 Sep *Excludes special dividend of 165p, payable on 27 July | ||||
