Aldermore announces intention to float
CHALLENGER bank Aldermore has announced its intention to float in a move which could see it raise £75m.
The move comes a week after the firm unveiled a strong set of results with profits more than doubling.
The bank, whose Birmingham office is at 35 Newhall Street, had intended to go ahead with its flotation last autumn but pulled the plug on the move due to market volatility.
The bank said the offer would comprise the issue of new shares intended to raise gross proceeds of approximately £75m. The net proceeds from the offer will be used to support the medium term growth of the business.
Phillip Monks, Chief Executive Officer, said: “Now in our sixth year, Aldermore has demonstrated strong and sustainable levels of profitable growth, as seen most recently in our record full year results; we have been clear that we view the public markets as the right place for us to be as we look to maintain this momentum.
“Now is the right time for Aldermore to seek a listing on the London Stock Exchange. As our strong performance in 2014 highlights, we have consistently delivered on our ambitious targets and we have proven our ability to grow organically and profitably. In 2014, underlying profit before tax more than doubled, driven by strong balance sheet growth, with net lending to SMEs and homeowners higher than ever before.
“The combination of a modern, digital, legacy-free platform and award winning expertise in otherwise underserved market segments enable Aldermore to offer banking services the way they should be. This means attractive and straight-forward products combined with transparent and efficient service to meet each of our customers’ needs and deliver them appropriate financial solutions. We will look to offer our shareholders strong risk-adjusted returns underpinned by a modern and scalable operating platform.”
Its 2014 results showed the cost/ income ratio improved by 6pts to 60% (2013: 66%), while the return on equity increased to 15% (2013: 12%). The second half of the year was especially strong with the net interest margin growing 0.2% to 3.6% (FY 2014: 3.4%), while the return on equity increased 4% to 19% (FY 2014: 15%).
The bank said it had also seen increased support among SMEs and homeowners, with net loans to customers up by 42% to £4.8bn (2013: £3.4bn) and lending to SMEs up by 32% to £2.2bn (2013: £1.7bn). Residential mortgages grew by 53% to £2.6bn (2013: £1.7bn).
It will be hoping to boost its lending with introduction of new Buy to Let and Help to Buy mortgage offers.
Customer deposits were up by 29% to £4.5bn (2013: £3.5bn) and it saw a near doubling of SME deposits, which grew by 97% to £1.0bn (2013: £0.5bn).
