(Reuters) - Britain's Arbuthnot Banking Group ARBB.L and its minority-owned Secure Trust Bank Plc STBS.L expect the market turmoil after the UK's vote to leave the EU to create investment opportunities for their companies, top company executives said.
The investment community has been concerned that Brexit could result in an economic downturn in Britain, which could hurt European financial services companies’ profits.
However, Arbuthnot and Secure Trust, which are flush with cash after selling some assets earlier this year, are optimistic about the potential impact of the vote, and said their capital positions would allow them to go for deals.
“What we learnt in the 2008 banking crisis is that turmoil can create opportunities,” Arbuthnot Chief Operating Officer Andrew Salmon told Reuters on Tuesday, but said it was too early to identify the nature of the opportunities.
Secure Trust Chief Executive Paul Lynam said the company was looking to make “meaningful to transformational” deals.
“We see Brexit as having more long-term benefit than threats,” Lynam told Reuters.
Asset sales helped Arbuthnot and Secure Trust to report huge jump in first-half profit on Tuesday.
Arbuthnot’s profit soared nearly 18-fold to 225 million pounds, while Secure Trust’s profit rose 10-fold to 129.1 million pounds.
Arbuthnot earned about 100 million pounds through the sale of a 33 percent stake in the challenger bank.
The companies benefited from the sale of Secure Trust’s Everyday Loans Group unit, resulting in a gain of about 117 million pounds.
Arbuthnot shares rose as much as 5.7 percent to 1480 pence on the London Stock Exchange on Tuesday in thin morning trade. Secure Trust shares gained as much as 6.7 percent to 2025 pence in low volumes.
Reporting by Mamidipudi Soumithri and Noor Zainab Hussain in Bengaluru; Editing by Gopakumar Warrier
Our Standards: The Thomson Reuters Trust Principles.