Secure Trust Bank (LSE:STB) reported adjusted profit before tax of £51.1 million for 2025, matching market expectations and representing an increase of more than 30% compared with the previous year. The performance was supported by total net lending rising to £3.7 billion, with the loan book from continuing operations expanding by 8.1%.
Strong contributions came from the bank’s Retail Finance and Real Estate Finance divisions, both of which delivered solid growth during the year. Customer deposits also increased by 8.2%, providing additional funding to support lending expansion. Meanwhile, Secure Trust Bank improved its CET1 capital ratio to 12.9%, even after accounting for provisions related to potential motor finance compensation claims.
The group confirmed continued progress on the previously announced sale of its Consumer Vehicle Finance business to funds managed by LCM Partners. The transaction is expected to generate a net gain of approximately £9 million and, on a pro forma basis, increase the CET1 ratio to 14.7%. The additional capital is expected to support reinvestment into higher-return core operations, strengthen the bank’s competitive position and potentially allow for further shareholder distributions. Secure Trust Bank will remain responsible for administering any future redress related to the disposed loan portfolio.
For accounting purposes, the Vehicle Finance division will be treated as a discontinued operation in the 2025 financial results. The bank will continue servicing the associated loan book on behalf of the buyer until customer accounts are migrated, which is expected to take place in May 2026. Management also plans to present updated strategic priorities, capital allocation plans and revised medium-term targets alongside the full-year results scheduled for March.
Secure Trust Bank’s outlook reflects moderate financial performance, with some pressure on profitability and weaker cash flow, although the balance sheet remains relatively stable. Technical indicators appear favourable, with the share price trading well above key moving averages and supported by a positive MACD signal. However, elevated momentum indicators, including high RSI and stochastic readings, suggest potential near-term volatility. From a valuation perspective, the stock appears relatively attractive, supported by a modest price-to-earnings ratio and an approximate dividend yield of 2.12%.
More about Secure Trust Bank
Secure Trust Bank is a UK-based retail bank with more than 70 years of operating history and a strong capital base, headquartered in Solihull in the West Midlands. The group focuses on business lending through its Real Estate Finance and Commercial Finance divisions, alongside consumer lending through its V12 Retail Finance platform, serving a broad customer base across specialist finance markets.
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