UPDATED: New era dawns as CYBG notches up statutory profit
Glasgow-based CYBG, which demerged from former owner National Australia Bank in February, hailed a “landmark year” as it posted bottom-line pre-tax profits of £77m for the 12 months to September 30 against a loss of £285m the previous year.
The group last month confirmed it had made an offer to buy Royal Bank of Scotland’s 300-strong Williams & Glyn branch business, after Santander pulled out of talks.
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Hide AdCYBG said in September that it will trim its branch network further, from 248 to less than 200 over the next three years.
Alongside the cost savings, it is investing more than £350m over the next two years to overhaul the group, by improving its online banking offering and boosting technology platforms.
Debbie Crosbie, the chief operating officer, said that CYBG had secured 4,500 new business current account customers over the year, which brought the total number to 27,000.
Ms Crosbie told The Yorkshire Post that a face to face service via the branch network was still important, and the bank is revitalising many of the branches.
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Hide AdMs Crosbie said that any job cuts are expected to come from natural attrition.
The bank also plans to introduce seven new flagship branches around the country.
Ms Crosbie said it was too early to talk about any specific impact of the referendum vote in favour of Brexit, which took place in June.
The bank has also experienced a 41 per cent fall in the number of customer complaints over the last year.
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Hide AdCYBG chairman Jim Pettigrew said: “2016 has been a landmark year in the long history of our bank, as we became independent for the first time since the 1920s. Our ambition is straightforward: to become the credible alternative to the big UK banks.”
CYBG’s chief executive, David Duffy, said: “CYBG has delivered on our promises to our customers and shareholders, building strong foundations for our future growth and positive momentum going into 2017.
“Our annual results show a strong financial performance, with underlying profit up 39 per cent and the first statutory profit before tax in five years through robust growth in mortgages, SME lending and deposits, supported by our ongoing cost reduction programme.
“We are investing in our future, with an investment programme in the next two years of over £350m in part to unlock the potential of CYBG’s digital platform which will drive improvements in our customer experience and distribution capabilities.
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Hide Ad“As the only true full service, challenger bank of scale, we are perfectly placed to disrupt the status quo in the UK banking market.”
The group grew its mortgage lending by 6.5 per cent over the year and saw its small business loan book increase by 6.1 per cent.
On an underlying basis, CYBG’s pre-tax profits rose to £221m from £159m the previous year.
CYBG said it has not increased cash set aside for payment protection insurance (PPI) compensation, despite the recent move to put back the deadline for claims by a year.
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Hide AdCYBG said it had delivered its key financial metrics. Its cost reduction programme is on target, and CYBG is well capitalised, the bank said in a statement.
Apart from delivering its first statutory profit before tax in five years, CYBG said it had also recorded strong loan and deposit growth across the business.
Yorkshire Bank was founded in 1859 in Halifax, West Yorkshire, by Colonel Edward Akroyd, who wanted to provide a means of saving for the working classes.