Slide 1: Secure Trust Bank PLC 2015 Year End Results
Secure Trust Bank PLC 2015 YEAR END RESULTS 17th March 2016
Slide 2: Introduction & business review
Introduction & business review PAUL LYNAM Chief Executive Officer
Slide 3: FY 2015 Highlights
FY 2015 Highlights* Proven strategy, successfully delivering Continued to deliver on proven strategy Loan book up 73% and now exceeds £1bn Book diversified by expanding SME lending business Customer numbers exceed 0.5m Strong returns and shareholder value PBT up 40% to £36.5m Underlying return on re
Slide 4: Sale of Everyday Loans Group (ELG)
Sale of Everyday Loans Group (ELG) Broadens the range of strategic options available and accelerates organic growth in Motor, Retail and SME lending books* Expected post tax profit of sale estimated at £115m Special dividend proposed 165 pence per share £30m total cost Substantial increase in capita
Slide 5: Strategic goals
Strategic goals 1. Organic growth 2. Diversification 3. M&A activity 5
Slide 6: Strategy
Strategy Very significant shareholder value created 260 240 £78m capital generated since IPO growing to c. £163m 220 post ELG sale and payment 200 of proposed special dividend 180 160 Consistently strong dividend 140 payment pattern £m 120 Capital remains healthy with 100 Common Equity Tier 1 ratio
Slide 7: Continued growth in loan book with increased diversity
Continued growth in loan book with increased diversity Consumer Finance Business Finance 53% of loan book (FY 2014 70%) 44% of loan book (FY 2014 23%) Personal Lending Motor Finance Retail Finance Real Estate Finance Asset Finance Commercial Finance (inc. ELG) Fixed rate, fixed term Prime credit por
Slide 8: Sustainable positive progress
Sustainable positive progress FY 2015 FY 2014 £m £m Gross interest income 139.6 93.5 Lending assets £m Interest expense (21.6) (14.2) Net interest income Impairment losses 118.1 (24.3) 79.4 (15.3) GROWTH 73 1100 ON FY 2014 OF Reported PBT 36.5 26.1 % 1000 Underlying PBT 39.3 33.3 900 800 Basic EPS (
Slide 9: Customer feedback and awards
Customer feedback and awards Motor Finance V12 Customer feedback from * Consumer feedback from * ‘‘ ‘‘ (currently 94% positive 6 month score) (currently 99% positive) ‘‘ Prompt, customer friendly company. Never ‘‘ Easy, straightforward and quick decision, ‘‘ ‘‘ had any issues with them and would hap
Slide 10: Business to business feedback
Business to business feedback Motor Finance Business Finance Retail Finance ‘‘ ‘‘ Louis Rix, director of Chris Davies, finance director of Jonathan Blanchard CFO Carfinance247, said: the Great British Card Company at Evans Cycles: During the pilot scheme, confirmed that the Secure Trust Evans have b
Slide 11: Financial review
Financial review NEERAJ KAPUR Chief Financial Officer
Slide 12: Summary income statement
Summary income statement Strong growth in earnings and dividend £m FY 2015 FY 2014 % change 49% increase in net interest income Net interest income 118.1 79.4 49% • Strong growth in Consumer lending and Net fee, commission and other income 14.4 18.5 -22% new SME lending businesses Operating income 1
Slide 13: Sale of Everyday Loans Group (ELG)
Sale of Everyday Loans Group (ELG) Impact of the sale STB FY 2015 ELG FY 2015 Adj. STB FY 2015 The economic risks and rewards Profit & Loss £m of the ELG business generated Interest income 139.7 39.2 100.5 after 30 November 2015 will pass Interest expense (21.6) - (21.6) to NSF on completion of the
Slide 14: Profit bridge
Profit bridge Underlying PBT of £39m, an increase of 18% on FY 2014 40 30 £m 20 10 0 STB Subsidiary Share Group STB Underlying STB ELG V12 Share Group STB ELG full year STB exc. Reported consolidation option recharges Underlying business Underlying consolidation amortisation option recharges Reporte
Slide 15: Income bridge
Income bridge* Increase on FY 2014 of £44m +£44m 160 150 140 £m 130 120 110 100 FY 2014 Real Estate Asset Commercial Personal ELG Motor Retail Other FY 2015 £113.8m Finance Finance Finance Lending £6.4m Finance Finance £(2.7)m £158.1m £17.9m £2.4m £1.5m £2.1m £6.1m £10.6m * Income before interest ex
Slide 16: Income analysis
Income analysis Total income through lending and transactional channels is analysed as follows: FY 2015 FY 2014 £7.4m £20.3m £6.5m £2.5m £8.9m £4.5m £2.4m £0.1m Real Estate Finance £7.1m Asset Finance £0.03m £1.6m £5.0m Commercial Finance £24.2m £15.1m Personal Lending £17.2m Everyday Loans Group £1
Slide 17: Balance sheet summary
Balance sheet summary Projected impact of the sale FY 2014 FY 2015 ELG ELG Sale FY 2015 Customer loans £m Statutory Statutory Transaction Post ELG Sale (including ELG) Cash and balances at central banks 81.2 131.8 - 174.8 306.6 up 73% to £1.1bn Loans and advances to banks 39.8 11.5 (1.7) - 9.8 Custo
Slide 18: Customer loan progression
Customer loan progression Increase on FY 2014 of £452m, representing growth of 73% 1100 1000 900 800 700 600 £m 500 400 300 200 100 0 FY 2012 FY 2013 FY 2014 FY 2015 Personal Lending ELG Motor Finance Retail Finance Real Estate Finance Asset Finance Commercial Finance DMS and Other 18
Slide 19: Lending bridge
Lending bridge Increase on FY 2014 of £452m 1200 +£452m 1100 1000 900 800 700 £m 600 500 400 300 200 100 0 FY 2014 Real Estate Asset Commercial Personal ELG Motor Retail DMS and FY 2015 £622.5m Finance Finance Finance Lending £20.4m Finance Finance Other £1,074.9m £234.2m £66.2m £24.3m £(13.2)m £27.
Slide 20: Deposit progression
Deposit progression Increase on FY 2014 of £425m, weighted towards Term deposits 1000 900 800 700 57.0% 600 500 £m 54.4% 400 39.0% 44.3% 300 200 39.2% 53.0% 47.4% 39.4% 100 8.0% 8.3% 6.2% 3.8% 0 FY 2012 FY 2013 FY 2014 FY 2015 Sight Notice Term 20
Slide 21: Competitor analysis
Competitor analysis STB 2015 SHAWBROOK 2015 ALDERMORE 2015 Underlying PBT / Loan book (1) 4.6% 3.0% 1.8% Common Equity Tier 1 (CET) ratio 13.6% 14.4% 11.8% ROTE (2) 25.1% 27.9% 20.6% Price to tangible NAV (3) 2.4 2.4 1.7 Dividend yield (4) (5) 2.2% 0.0% 0.0% Loan to deposit ratio 104% 104% 107% Loan
Slide 22: 2016 Outlook
2016 Outlook Continued sustainable growth accelerated by Successful funding strategy leveraged ELG sale • STB will continue to be funded by deposits with • SME businesses – accelerate growth and further demand remaining strong for fixed rate products develop Asset Finance business partnership with a
Slide 23: Summary
Summary Continued to deliver on proven strategy in 2015 73% loan book increase (inc. ELG) Strong PBT and dividend growth Business Finance division now established, providing diversification and growth potential Ongoing commitment to sustainable growth Continued investment in our team and our systems
Slide 24: Appendices
© Secure Trust Bank Straightforward transparent banking Appendices W SecureTrust ‘Simple and Straightforward Savings Hassle ree Savings and Fixed Bonds Saving With Us vat happening? fea Eee Face Real Estate Finance
Slide 25: Business finance
Business finance 500 400 Business Finance FY 2012 FY 2013 FY 2014 FY 2015 300 Revenue £m - 0.1 2.6 24.3 £m 200 Impairments £m - - - (0.3) 100 Loan book £m - 1.8 143.3 468.0 0 FY FY FY FY 2012 2013 2014 2015 Loan book 25
Slide 26: Business finance
Business finance Business overview – Real Estate Finance Business overview – Asset Finance Commenced operation in H2 2013 Launched in Q4 2014 Five main products available; residential development, Hire purchase and finance lease arrangements commercial development, residential investment, commercial
Slide 27: Consumer finance
Consumer finance 600 Consumer Finance FY 2012 FY 2013 FY 2014 FY 2015 500 400 Revenue £m 44.0 73.1 90.2 115.4 £m 300 Impairments £m (8.7) (15.0) (15.0) (24.8) 200 Loan book (exc. ELG) £m 196.1 262.6 342.1 460.4 100 0 ELG loan book £m 74.1 81.4 93.9 114.3 FY FY FY FY 2012 2013 2014 2015 Total loan bo
Slide 28: Consumer finance
Consumer finance Business overview – Personal Lending Business overview – Motor Fixed rate, fixed term unsecured personal loans, with a New Prime lending product launched in April 2015 12-60 months duration offering greater participation across the risk curve Advances from £500 to £15,000 Maximum lo
Slide 29: Strategy continues to deliver
Strategy continues to deliver Maximise shareholder value: To maximise shareholder value through To protect the reputation, integrity and To ensure that the fair treatment of strong lending growth by delivering great sustainability of the Bank for all of our customers is central to corporate culture
Slide 30: Forward looking statements
Forward looking statements This document is a summary only of certain information contained in the announcement dated 17th March 2016 and should be read in conjunction with the full text of the announcement. This document contains forward looking statements with these forward looking statements as a