Yorkshire Bank back in profit but lending falls

YORKSHIRE Bank today hailed a “significant transformation” of the business as it announced pre-tax earnings of £54m.

The lender, owned along with Glasgow-based Clydesdale Bank by National Australia Bank (NAB), which announced its half-year results overnight, said that its decision to simplify its business model to concentrate on its traditional strengths had helped it make progress.

In the six months to March 31, the UK Banking operations of NAB had pre-tax cash earnings of £54m, up £92m from last year’s £38m loss, following the transfer of £5.6bn of commercial real estate assets to its parent last October.

That also helped deliver a £191m improvevement in its bad and doubtful debt charge which fell to £91m.

Chief executive David Thorburn, said: “Good progress has been made in delivering the key outcomes of the strategic review announced last April. Our strategy to become a stronger and more competitive business is proving to be the right one and, while there is more work to be done, there has already been a significant transformation of our business.

“Simplifying our business model to concentrate on our traditional strengths, we have successfully reshaped the geography, risk appetite and the composition of business banking. Our support for mortgage customers has also continued with over 9% growth in average mortgage lending balances.

“While conditions remain challenging, we are in good shape for the future as a strong customer-focused bank for the communities in which we operate. This is underpinned by a smaller and stronger balance sheet, with a significantly improved funding and capital position,” added Mr Thorburn.

The bank said that it is more than 70% of the way towards the 1,400 job losses planned by September 2015.

It said average mortgage lending balance growth of £1.3bn or 9.1% was well above system growth of 1.5% (Bank of England, March 2013) in the half but despite that average gross loans and acceptances decreased by £6.3bn to £27.4bn with SME lending down significantly also.

Click here to sign up to receive our new South West business news...
Close