LONDON (ShareCast) - (Sharecast News) - Charter Court Financial Services reported a drop in interim profits on Wednesday but strong loan book growth as it prepares to merge with rival OneSavings Bank following the receipt of shareholder approval.
The financial services provider achieved profit before tax of £82.6m for the six months ended 30 June, down 11% compared to the same period last year, as administrative expenses increased by 28% to £39.7m and interest expenses rose by 34% to £57.8m.

Net interest margin dropped from 3.08% to 3.04%, while the Common Equity Tier 1 ratio dropped from 16.6% to 15.6%, which the business still regarded as "strong".

Charter Court's loan book grew by 24% to £7.0bn while interest income grew by 24% to £157.9m due to continued expansion of the mortgage origination business.

The company declared an interim dividend of 4.3p a share, up from 2.8p a year earlier.

Despite the heightened uncertainty in the wider economy, Charter Court said it continues to see robust demand for its specialist lending propositions and remains confident in the resilience of its business model.

Chief executive Ian Lonergan said: "We continued to leverage our specialist lending platform to once again deliver against all our targets in the first half of 2019. Steady loan book growth continued to be driven by strong originations of £1.5bn across our lending portfolio. This positive result was achieved whilst maintaining a disciplined approach to underwriting, reflected in the high quality of our mortgage book."

Lonergan added that shareholders have now approved the recommended all-share combination with OneSavings Bank, though the merger remains subject to the satisfaction or waiver of other conditions including approvals from relevant UK regulatory authorities.

Charter Court Financial Services shares were down 2.23% at 285.00p at 0850 BST.

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