Despite subdued market demand for credit, new lending of £4.7 billion was advanced in the year including £2.7 billion of business lending and £1.7 billion of mortgage advances. As a result of portfolio rebalancing, commercial property lending fell (down 14%) whilst the momentum of lending to trading businesses was maintained and mortgage lending increased.
Average gross loans and acceptances were broadly flat at £32.9 billion (from £33.3bn), as a result of consciously reducing commercial property (down 11.3%) and unsecured personal lending exposures (down 12.5%). Lending for mortgages and trading businesses grew by 4% and 3% respectively.
Clydesdale and Yorkshire empahsise that the banks remain firmly on track to deliver against its October 2009 pledge to make £10 billion of new lending available to support business and personal customers by October 2011.
Overall, the banks achieved a substantial recovery in profitability in the year, with pre-tax cash earnings growth of 53% to £164 million (from £107m).
Lynne Peacock, chief executive, comments:
“Our clear focus on supporting customers and maintaining a prudent approach to credit has proved to be very effective. We are attracting growing numbers of small and mid-corporate trading businesses and expanding our mortgage book which is greatly encouraging.
"Although the economy is in the early stages of recovery, we advanced £4.7bn of new lending in the year and remain firmly on track to deliver the two-year new lending commitment of £10bn we made last October.
“As a result of this strategic focus, a significant step forward has been taken towards restoring profitability with a 53% increase in pre-tax cash earnings. This was achieved whilst we further strengthened and re-shaped our balance sheet, maintained a strong capital position and supported our customers through challenging times.
“While national economic recovery will provide further challenges, Clydesdale and Yorkshire Bank is in a strong position and continues to send a clear message to new and existing customers that they have real choice and support in the market.”
