Close Brothers halts dividends amid 'uncertainty' over FCA motor finance review

investmentweek.co.uk:

The firm’s board said there is 'significant uncertainty' about the outcome of the FCA’s review and it was not able to estimate the timing, scope or any potential financial impact that may derive from it.

In a stock exchange notice published today (15 February), the firm's board said there is «significant uncertainty» about the outcome of the FCA's review and it was not able to estimate the timing, scope or any potential financial impact that may derive from it.

Close Brothers said it will review the reinstatement of dividends for the 2025 financial year once the regulator has concluded its process and any financial consequences for the group have been assessed.

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However, the firm noted positive performance across the group, with its banking division generating £112m of adjusted operating profit in the six months to 31 January 2024, and Close Brothers Asset Management delivering annualised net inflows of 9%.

The firm said: «In addition, the board is implementing a range of actions to further accrete capital including optimising risk weighted assets and continued delivery of our cost management initiatives.

»The board is confident that these actions will further build our capital strength, leaving the group in a strong position to continue to support our customers and protect our valuable franchise."

 A further update will be provided in Close Brothers' half-year 2024 results on 19 March.

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