Loan book growth lifts OneSav­ings

The Daily Telegraph - Business - - Business - Latoya hard­ing

ONESAV­INGS BANK was the stand­out mid cap yes­ter­day, jump­ing more than 15pc af­ter it re­ported loan-book growth and a dou­ble-digit rise in profit de­spite heavy im­pair­ment costs.

The spe­cial­ist loans group – which is the par­ent of Kent Reliance, the buy-to-let lender – re­vealed a 10pc rise in profit be­fore tax to £99.3m for the first six months of 2020, while its loan book grew 2pc to £18.8bn.

Andy Gold­ing, the chief ex­ec­u­tive, said: “We ex­pect to de­liver dou­ble digit un­der­ly­ing net loan book growth for the full year, ex­clud­ing the im­pact of the struc­tured as­set sales in Jan­uary.”

Its un­der­ly­ing losses from im­pair­ments stood at £54.4m for the pe­riod, which the group said was “pre­dom­i­nantly driven by a £42m charge due to the adop­tion of more se­vere Covid-19 re­lated macroe­co­nomic sce­nar­ios”.

Good­body’s John Cronin said OneSav­ings Bank looks like a fairly strong stock pick, adding it has “con­sid­er­able head­room to cope with any neg­a­tive shocks in an as­set qual­ity con­text as fur­lough schemes are ta­pered”. OneSav­ings Bank ended the day 40.8p higher at 301.4p. It came as the FTSE 100 slipped 0.75pc into the red, back be­low the 6,000 points mark, af­ter US Fed­eral Re­serve chief Jerome Pow­ell said he would not rush to raise in­ter­est rates and could al­low in­fla­tion to stay above his 2pc tar­get “for some time”.

The FTSE 250, how­ever, did man­age to eke out some gains, climb­ing 0.05pc to 17,762.03.

Elsewhere, Ocado shares fell slightly af­ter it named Rolls-Royce’s chief fi­nan­cial of­fi­cer Stephen Dain­tith as its new fi­nance boss, re­plac­ing Dun­can Tat­ton-Brown, who is step­ping down for fam­ily rea­sons af­ter eight years. Mr Tat­ton-Brown will re­main un­til Nov 22, af­ter which he will be­come a non-ex­ec­u­tive di­rec­tor.

Lord Rose, Ocado’s chair­man, thanked the out­go­ing fi­nance chief for his con­tri­bu­tion and said Mr Dain­tith’s “broad ex­pe­ri­ence will be an as­set to the com­pany”. Shares closed 15p lower at £25.20.

How­ever, Rolls-Royce shares, man­aged to re­coup their early losses af­ter sink­ing into neg­a­tive ter­ri­tory for most of the ses­sion. Its first half ad­justed op­er­at­ing loss was £1.67bn, which was greater than ex­pected, but the group is ex­am­in­ing ways to strengthen its bal­ance sheet. It is eye­ing as­set sales which should raise at least £2bn. It gained 3.5p to 256.5p.

Mean­while, shares in WPP pushed 40.4p higher to 664.4p, af­ter the ad­ver­tis­ing gi­ant said its trad­ing is im­prov­ing af­ter swing­ing to a £2.6bn first-half loss. The FTSE 100 group saw rev­enues fall 10.2pc and took £2.7bn of im­pair­ments dur­ing the pe­riod but said its trad­ing im­proved dur­ing July, sug­gest­ing the worst part of the virus’s im­pact has passed.

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