Aldermore’s profits lift but bank warns of uncertainty
ALDERMORE BANK reported higher profits as it warned that Brexit uncertainty is weighing on an already fiercely competitive banking industry.
The lender, which has an office in Leeds. made a pre-tax profit of £74.7m in the six months ended December 31 compared with £62.8m in the same period a year earlier.
The challenger bank said: “As we await the outcome of the UK’s Brexit negotiations, there is a high degree of uncertainty in terms of the economic outlook.
“Competition among banks is intense and the operating environment is expected to remain challenging, with bank margins under continuing pressure.
“Within this environment, we will continue to focus on maintaining a high-quality diversified portfolio”.
Aldermore increased its loans by 4 per cent to £9.4bn and maintained a net interest margin – the difference between what a bank pays savers and charges borrowers – of 3.6 per cent.
Return on equity, a key measure of a bank’s profitability, grew to 16 per cent from 13 per cent.
Chief executive Phillip Monks said: “In a competitive market we have achieved good profitability and returns while managing risk appropriately. We have a balanced portfolio of assets that has served us well.”
The results come ahead of the bank’s 10th birthday in May with the lender having grown rapidly over the past decade from just 30 employees to more than 1,000.
It floated on the London Stock Exchange in 2015 and last year was bought by South African giant FirstRand for £1.1bn.
Mr Monks, a former Barclays executive, said yesterday: “Ten years ago, many small businesses were losing a battle for survival as the banking establishment pulled up the drawbridge.
“Founded as a start-up in 2009, Aldermore was the first of a new breed of challenger banks to offer a strong alternative and I’m proud of the additional choice we have made available to businesses, homeowners and landlords.”
Yorkshire has become an important base for Aldermore, as it aims to increase its market share across the UK.
Speaking to The Yorkshire Post in 2017, during a trip to the region, Mr Monks said the Leeds office was a really important hub because “it’s not only looking up into the Scottish market, it’s looking up to Newcastle; so there’s a massive geography.”
There is a high degree of uncertainty in terms of the economic outlook. A spokesperson for Aldermore Bank