(Corrects paragraph 3 to add the dropped word “former”)
Aug 22 (Reuters) - Secure Trust Bank said it further tightened its credit risk appetite and acceptance criteria for small- and medium-sized customers over the first six months of the year, on slowing economic growth and heightened levels of uncertainty.
Secure Trust, which offers both business and consumer finance, reported on Tuesday a 11 percent jump in pretax profit to 13.9 million pounds ($17.9 million) for the six months to June 30 as lending surged across all of its business units.
The former retail bank of Arbuthnot Banking Group said overall loan book jumped 34 percent to 1.51 billion pounds, while customer deposits grew 27.2 percent to 1.33 billion pounds.
Arbuthnot, which sold a 33 percent stake in Secure Trust via a placing in May 2016, had an optimistic stance on Britain’s vote to leave the European Union, and had said the associated turmoil would create investment opportunities.
However, Arbuthnot’s chairman and chief executive, Henry Angest, said last month that with uncertain economic and political times ahead, the lender remained cautious in its decision making.
The Bank of England (BoE) has also ordered banks to apply credit rules prudently and prove by September they are not being too complacent about risks to their balance sheets, with the BoE’s Prudential Regulation Authority highlighting credit card firms and motor finance as areas of concern.
Secure Trust said on Tuesday that its motor finance balances had grown to 258.4 million pounds from 236.2 million pounds as at Dec. 31, despite deciding to end its exposure to subprime motor loans and shifting to lower risk motor lending.
The group said it expected its motor portfolio quality to improve this year, as it began to see the benefits of changes made to its credit criteria and as it works through its back books. ($1 = 0.7759 pounds) (Reporting by Esha Vaish and Noor Zainab Hussain in Bengaluru; Editing by Amrutha Gayathri)