British lender Close Brothers makes "solid" start to financial year
(Reuters) - British lender Close Brothers Group (CBRO.L) said on Thursday it had made a "solid" start to its financial year amid challenging market conditions, driven by strength in its banking division and increased trading activity at its market maker, Winterflood.
The merchant banking group, which provides loans and wealth management and securities trading services, said the loan book at its banking division rose 1.9 percent to 7.4 billion pounds in the quarter.
The growth in loan book comes after the company warned last year that its banking business would face competitive challenges, prompting analysts to caution that loan growth would be limited and net interest margin could be pressured.
Greater market volatility tends to bolster profits at firms such as Winterflood as investors turn portfolios around more frequently. But volumes have not surged enough in the past few months, despite uncertainties stemming from the ongoing trade war between the United States and China.
The company, which provides loans, wealth management and securities trading services, said its net interest margin had remained broadly in line with the last financial year.
Close Brothers, founded in 1878 as a merchant bank to provide farm mortgages in Iowa, said its Winterflood business "remained resilient" in the first quarter, despite challenging market conditions compared with the last financial year.
(Reporting by Noor Zainab Hussain and Adil Bhat in Bengaluru; Editing by Saumyadeb Chakrabarty)
