Aldermore Group has posted a 13% growth in operating profit before tax to £132.8m (H1 2023: £117.0m). Despite the subdued lending market, the Group was able to drive portfolio growth in higher returning lending segments, and continued deposit growth. Profits have also benefited from a more stable macroeconomic outlook leading to a reduced impairment charge. The Group remains well capitalised, with a CET1 ratio of 14.9% and a strong liquidity coverage ratio of 248%.
Steven Cooper, CEO of Aldermore Group said:
“We’re pleased with our performance in the half, delivering strong underlying profits supported by increased revenues, a fall in impairments and steady growth in customer deposits despite fierce competition. This has been achieved against a backdrop of difficult economic conditions and a property market which has been at its most subdued in many years. We’re now supporting over 800,000 customers – helping those that the traditional high street banks typically overlook, to ensure they get the support to go for it in life and business.
“Looking ahead, we’re optimistic about what the future holds. Our Buy to Let and Asset Finance businesses have been performing particularly well and with confidence slowly starting to return to the property market, we think we’re well placed to take advantage of improving conditions. However, there is no room for complacency as economic headwinds may persist in 2024. That’s why we continue to maintain a strong and resilient capital and funding position, while investing in our people and technology so that we can build great products and services for our customers.”
Financial Performance
|
Income Statement (£million) |
H1 2024 |
H2 2023 |
H1 2023 |
Change vs H2 2023 |
Change vs H1 2023 |
|---|---|---|---|---|---|
|
Total income |
223.7 |
241.9 |
217.7 |
(7)% |
3% |
|
Operating expenses |
(106.4) |
(115.1) |
(94.5) |
(8)% |
13% |
|
Impairment losses |
(3.1) |
(25.9) |
(25.5) |
(88)% |
(88)% |
|
Aldermore Bank1 operating profit before tax |
114.3 |
100.9 |
97.7 |
13% |
17% |
|
MotoNovo Finance1 profit before tax |
18.5 |
13.4 |
19.3 |
37% |
(4)% |
|
Group operating profit before tax |
132.8 |
114.4 |
117.0 |
16% |
13% |
|
Net derivatives (loss) / gain2 |
(10.8) |
19.0 |
6.7 |
(<100)% |
(<100)% |
|
Strategic technology investment3 |
(17.4) |
(22.7) |
(11.8) |
(24)% |
47% |
|
Group statutory profit before tax |
104.6 |
110.6 |
111.9 |
(5)% |
(7)% |
Key Performance Indicators
|
|
|
H1 2024 |
H2 2023 |
H1 2023 |
Change vs H2 2023 |
Change vs H1 2023 |
|
Aldermore Bank [Operating] |
Net interest margin (%) |
4.00% |
4.29% |
3.79% |
(0.29)% |
0.21% |
|
Cost:Income ratio (%) |
47.5% |
47.6% |
43.5% |
(0.0)% |
4.0% |
|
|
Cost of risk (bps) |
5bps |
46bps |
45bps |
(41)bps |
(40)bps |
|
|
Return on equity (%) |
13.0% |
12.5% |
12.8% |
0.5% |
0.2% |
|
|
CET1 ratio4 (%) |
18.5% |
18.5% |
17.5% |
0.0% |
1.0% |
|
|
Aldermore Group [Statutory] |
Net interest margin (%) |
3.99% |
4.23% |
3.91% |
(0.24)% |
0.08% |
|
Cost:Income ratio (%) |
55.9% |
51.4% |
47.4% |
4.5% |
8.5% |
|
|
Cost of risk (bps) |
33bps |
76bps |
70bps |
(43)bps |
(38)bps |
|
|
Return on equity (%) |
9.6% |
11.9% |
12.1% |
(2.4)% |
(2.6)% |
|
Group Balance Sheet (£million) |
Dec 2023 |
Jun 2023 |
Dec 2022 |
Change vs Jun 2023 |
Change vs Dec 2022 |
|
Customer lending balances |
14,983 |
15,167 |
15,468 |
(1)% |
(3)% |
|
Customer deposit balances |
15,892 |
15,033 |
15,245 |
6% |
4% |
|
Group Capital and Liquidity (%) |
Dec 2023 |
Jun 2023 |
Dec 2022 |
Change vs Jun 2023 |
Change vs Dec 2022 |
|
CET1 ratio4 |
14.9% |
14.8% |
14.0% |
0.1% |
0.9% |
|
Total capital ratio4 |
17.5% |
17.4% |
16.6% |
0.1% |
0.9% |
|
Liquidity coverage ratio |
248% |
265% |
218% |
(17)% |
29% |
Aldermore Bank
MotoNovo Finance
Aldermore Group
FCA Review of Motor Finance Commissions
-ENDS-
Notes to Editors
1 Aldermore Group comprises two operating companies: Aldermore Bank plc and MotoNovo Finance Limited. Amounts relating to Aldermore Bank plc include amounts relating to its associated securitisation vehicles, consolidation entries and the Aldermore Group Holding Company (Aldermore Group); amounts relating to MotoNovo Finance include amounts relating to its associated securitisation vehicles. Bank ROE and CET1 reflects Aldermore Bank plc on a standalone basis.
2 Net derivatives loss / gain relates to fair value movements in derivative and other financial instruments held for risk management purposes. It includes all realised and unrealised movements, interest and foreign exchange differences.
3 Strategic Technology Investment forms part of a programme of work to support the Group’s long-term growth ambitions.
4 CET1 and total capital ratio is presented on an IFRS9 transitional markets basis.
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