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By Bradley Gerrard | Published May 17, 2012

Close AM makes ‘small’ loss as restructuring nears end

Close Asset Management has made a “small loss” but parent company Close Brothers Group said this was “expected” given the business is in the “final stages of its restructuring”.

In the group’s third quarter results for the period February 1 to April 30, the group said the asset management business saw private client assets under management (AUM) increase “slightly” to £7bn compared to £6.9bn in January 2012.

However, total AUM reduced to £8.3bn, down from £8.6bn on January 31 this year, which the group said reflected the “completion of the previously announced sale of OLIM’s property fund management business with £400m AUM.

Overall, the group said it saw “strong growth” in the banking division although “difficult market conditions” impacted the securities part of the business in the quarter.

“The group has maintained a strong funding position and remains well capitalised,” the group added.

Close Brother said the banking division saw “good demand” for its lending services with the loan book increasing 6 per cent in the quarter to £4bn at April 30, which the business said reflected strong new business particularly in motor finance, asset finance and property.

“The net interest margin remains strong, although slightly lower than the first half of the financial year,” the group said.

“The credit quality of the loan book continues to improve and the bad debt ratio reduced slightly in the period.”

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