Bank eyes acquisitions after £150m share sale

ARBUTHNOT, the majority owner of Secure Trust Bank, has sold one-third of the bank to institutional investors.

Secure Trust believes the move will enable it to consider buying rivals, which it would not have been able to do under its Arbuthnot’s ownership.

“The reality is that Arbuthnot would not be able to support such a transaction, so diversifying the shareholder register opens up a broad range of strategic opportunities that aren’t on the table at the moment,” chief executive Paul Lynam told the Daily Telegraph.

“There are assets on the market such as Williams & Glyn and perhaps Co-op Bank, and we may be interested in giving those serious consideration.”

The share sale is subject to the approval of Arbuthnot’s board but there is a written undertaking from chairman Sir Henry Angest, who owns 55.08% of Arbuthnot, that he will support the move.

The sale of 6m shares in Secure Trust Bank will reduce Arbuthnot’s stake from 51.9% to 18.9% after it found buyers for slightly more of its shares than it had originally announced.

It sold its shares at £25 each, which was a 10.7% discount to its closing price on May 26 – and was the cause of a 7% fall in its share price on Friday. At the same time Arbuthnot’s shares rose by 6%.

Secure Trust has said it will now look to move from the Alternative Investment Market to the main market. It has begun it search for an independent non-executive chairman to replace Sir Henry, who has combined his joint chairman and chief executive role at Arbuthnot with being chairman of Secure Trust.

Solihull-based Secure Trust enjoyed a strong 2015, increasing pre-tax profits by 40% to £36.5m on the bank of significant growth in the business. Lending balances increased by 73%, taking it above £1bn, while the number of customers grew by one-third, to 570,000.