Cambridge & Counties Bank has delivered pre-tax profit for 2019 of £22.5 million. Despite economic and market headwinds, loans and advances to customers for the year were steady at £761 million, with good growth in asset finance and classic car lines – up overall from £48.3m to £62.7m. The bank’s balance sheet at year-end exceeded £1 billion, with a strong liquidity position.
The Leicester-based institution specialises in secured lending and deposit products for small and medium sized businesses, with a strong real estate investor client base. The bank funds all its lending through UK-based savings accounts. The Bank has a strong liquidity ratio with deposit balances at the end of 2019 totalling £854 million
The political uncertainty and economic slowdown, caused in part by Brexit, meant that Cambridge & Counties Bank focused on careful growth across all its business lines. This strategy enabled the bank to continue supporting its existing customers as well as new businesses without the need to reduce its credit quality or chase growth at inappropriate margins.
Mike Kirsopp, CEO at Cambridge & Counties Bank, said:
“2019 was a very challenging year for the banking sector and we were not immune to these market forces. In the context of political uncertainty, Brexit and a weakened UK economy, plus increased regulation and strong competition for customers, the bank performed well, and customers continue to tell us they are satisfied and would recommend us. Importantly, we have continued to invest in the business: our 2019 earnings reflect our ongoing investment in skilled staff and IT system development which are central to our future growth strategy.
“The key to our success remains the relationship between the frontline teams and the broker partners who understand us and our markets. We are very confident that we are meeting our broker partners expectations in terms of using technology to underpin our established and well-known focus on competitive products, relationships and personality.”
Along with its headquarters in Leicester, the bank now has regional offices in Sheffield, Birmingham and Bristol with satellite representation in Manchester, Cardiff and Glasgow. Across the year, the bank expanded its geographical representation through the recruitment of new Relationship Managers in Scotland, Manchester and Cardiff.
2019 also saw significant investment in the institution’s finance and lending capabilities as well as risk and compliance with Mike Hudson joining as Chief Risk Officer at the start of 2020.
Cambridge & Counties Bank has developed what it sees as one of the leading customer-centric, relationship-based bank business models in the UK. For 2019, 99% of new customers, said the bank dealt with their enquiry and application effectively, with the same score (99%) given for their willingness to recommend it.
Mike Kirsopp added:
“Several initiatives during the year, such as continuing to develop the relationship model with borrowers, have driven continued high levels of customer satisfaction and performance. The absence of cross selling of ancillary services to borrowers has been met with positive customer responses and our customers’ willingness to recommend us to their contacts. The outcome of this customer centric approach is reflected in the increasing ratio of new business generated from existing lending customers.
“Looking ahead, our aim is to realise niche opportunities in new and established markets that offer earnings at a level accretive to those achieved in our core businesses. For 2019 this was delivered through, for example, our new Relationship Managers and the successful launch of our term funding loan for holiday lets in the third quarter of the year.”
Simon Moore, Chairman at Cambridge & Counties Bank, said:
“I would like to thank Mike and the Executive team in delivering, during a year of challenges, not just a strong financial performance but continued high levels of customer and staff engagement and satisfaction. The board remains pleased with how the bank has continued to perform, protecting its income by the provision of a high-quality service offering together with a close control of costs and at the same time maintaining an appropriate investment profile in both people and technology.
“Moving into 2020, while we had started to see green shoots of growth through restored political certainty and a clearer direction on Brexit, the situation created by Covid-19 has altered the outlook. As a responsible business we have taken great steps to make sure our staff, customers and stakeholders are safe during this very difficult time. Our capital management, including retention of past profitability in our reserves, means we are very well capitalised to meet the challenges of 2020.
“As such, we are confident that we will be in a strong position as soon as the economic environment starts to normalise.”
Cambridge & Counties Bank Ltd is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority under firm registration number 579415. Our authorisation can be checked at the Financial Services Register at www.fca.org.uk.
Cambridge & Counties Bank Ltd Registered Office: Charnwood Court, 5b New Walk, Leicester England, LE1 6TE. Registered in England and Wales No. 07972522.
VAT Registration Number GB 208354420.
© Cambridge & Counties Bank Limited