Arbuthnot hikes dividend despite fall in earnings
By Josh White
Date: Thursday 27 Mar 2025
(Sharecast News) - Arbuthnot Banking Group reported a profit before tax of £35.1m for 2024 on Thursday, down from £47.1m in the prior year, despite maintaining broadly stable operating income at £179.5m.
The AIM-traded company cited tighter credit appetite and a reduced net margin of 5.1%, down from 5.7% in 2023, as key factors behind the decline in profitability.
Earnings per share fell to 152.3p from 222.8p, but Arbuthnot increased its final dividend to 29p, taking the total dividend for the year to 69p including a 20p special dividend paid in June.
That represented a 50% increase on the prior year's total distribution of 46p per share.
Net assets rose to £267m from £252.4m, while net assets per share increased to 1,636p.
The group maintained strong capital ratios, with a CET1 ratio of 13.2% and total capital ratio of 15.3%.
Surplus liquidity remained substantial at £896m above regulatory minimum requirements.
Customer deposits grew 10% year-on-year to £4.13bn, reflecting the continued strength of Arbuthnot's relationship-driven private and commercial banking model.
Lending growth was more modest, with customer loans increasing 2% to £2.38bn as the bank maintained a conservative lending stance.
Specialist lending divisions contributed positively to group performance.
Funds under management and administration rose sharply by 30% to £2.21bn, driven by strong inflows accounting for 28% of the opening funds.
Operationally, the group also completed its move to a new head office at 20 Finsbury Circus, officially opened by HRH The Princess Royal.
"As the interest rate environment normalised and deposit costs caught up with loan pricing, Arbuthnot delivered a creditable performance and made progress against the group's 'Future State 2' strategic plan," said chairman and chief executive officer Sir Henry Angest.
"We are confident that the continued delivery of our strategic plan will enable Arbuthnot to take advantage of all opportunities to develop the business over the medium term."
At 0819 GMT, shares in Arbuthnot Banking Group were down 1.79% at 898.6p.
Reporting by Josh White for Sharecast.com.
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