Close Brothers hails good third quarter

21st May 2010 06:59

Merchant bank Close Brothers remains confident of delivering a solid overall result for the 2010 financial year after a good third quarter performance.The group's Banking and Securities divisions both put in good shifts in the February to April quarter – the group's third quarter – while the outcome at the Asset Management division was more modest.As at the end of April the Banking division's loan book had increased to £2.7bn from £2.58bn at the end of January, largely as a result of organic growth in Asset Finance within Commercial, and Motor Finance operations in Retail.Though net interest margin and the bad debt ratio remained in line with the levels seen in the first half of the fiscal year the bad debt ratio “remains sensitive to the economic environment,” the group said.On the Asset Management side, funds under management (FUM) in the third quarter grew to £7.60bn from £7.29bn at the halfway stage.Investment spend in support of the Private Clients growth initiative continues and will have a negative impact on the division's result this financial year and next.In the Securities division average bargains per day at Winterflood have been marginally higher than in the first half of the year though there has been a decline in income per bargain. Close Brothers Seydler's performance was more muted whilst Mako has benefited from recent market volatility.