Arbuthnot falls on trading losses
Banking and financial services group Arbuthnot (ABG) shares fell after the firm reported that the firm's upcoming results will include around £8m in trading losses for the year.
Banking and financial services group Arbuthnot (ABG) shares fell after the firm reported that the firm's upcoming results will include around £8m in trading losses for the year.
ABG expects profits before tax for the continuing operations in 2011 to be around £5.0m.
The results will also show £3.5m of provisions in respect of the costs of an employee share scheme, but will exclude the final loss on the sale of Arbuthnot Securities (ASL), which is expected to be around £1m. The firm expects to record a gain on the sale of the shares in STB of approximately £16.5m. ASL's results for the year will be reported as discontinued operations.
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Despite the ongoing difficulties of the economic and business environment, the firm insisted 2011 has been a successful year for Arbuthnot Banking.
The group's capital position has been further strengthened by the initial public offering of Secure Trust Bank (STB), which continues to grow its balance sheet and fee income.
In a statement, the firm said: "STB continues to work on significant organic and external business opportunities.
"However, in respect of the consumer finance joint venture previously mentioned by ABG, despite exhaustive efforts we have been unable to agree a structure which meets the regulatory requirements and falls within our risk appetite; consequently the joint venture will not be proceeding as expected. As a result anticipated income associated with the joint venture has not been received and some extra costs associated with carrying excess deposits have been incurred."
The share price fell 4.41% to 325p by 14:27.
NR
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