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BRIEF-Secure Trust Bank sees FY results in line with market expectations
January 13, 2017 / 7:21 AM / in a year

BRIEF-Secure Trust Bank sees FY results in line with market expectations

Jan 13 (Reuters) - Secure Trust Bank Plc

* Pre-Close trading update

* Trading in final period of year has been in line with management’s expectations

* STB anticipates full year results will be in line with market expectations

* 2016 is expected to be tenth successive year when return on required equity is in region of 30 pct

* Significant increase in capital arising from disposal of Everyday loans results in group ROE reducing while this capital is re-deployed over time

* To mitigate the potential that weaker economic conditions and higher inflation could potentially lead to future increases in impairments particularly in consumer finance, the Group has tightened credit underwriting standards and increased pricing in these areas during the final quarter

* Net balances in consumer and SME lending have continued to be successfully grown in line with strategy

* Intends to cease originating new Unsecured Personal Loan (“UPL”) assets at this juncture

* STB intends to re-enter the UPL market once the risk adjusted yields available become more attractive. This decision is not expected to have a material impact on 2017 earnings

* Will continue to lend to proven house builders

* Believes it is well placed to manage transition to this new higher capital requirement regime given short duration of loan book and STB’s existing significant capital surplus

* New lending is being priced based on the new higher capital requirement levels to achieve the Group’s target RoE

* STB enters 2017 well placed to pursue its strategic priorities through developing its business model organically and pursuing M&A opportunities Source text for Eikon: Further company coverage:

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