Arbuthnot Banking Group fell into loss in 2008 because of the heavy loss made by investment bank Arbuthnot Securities.
The retail and private banking businesses both increased their profits – helped by gains on disposal - yet Arbuthnot Banking Group swung from a profit of £8.8m to a loss of £2.2m.
Aim adviser Arbuthnot Securities lost £5.2m in 2008, compared with a profit of £8.1m in 2007. That includes £700,000 spent on restructuring the business. The fall off in deals and flotations hit revenues. Corporate finance fees fell from £12mto £7.2m and there was a loss from dealing in securities in a falling market. The trading book has been significantly reduced. Management does say that it is selectively recruiting new staff. The number of retained clients grew by 14% to 97 over the year.
Despite “severely challenging market conditions” Arbuthnot Securities is expected to return to profit in 2009.
Shares in Arbuthnot Banking rose 5p to 220p each.
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