Secure Trust Bank (STB) investor relations material

Executive summary

• Achieved 14.3% ROAE in 2025, with profit before tax of £59.3m and operating income up 6.2% to £165.2m, driven by strong lending growth and a simplified business model after exiting Vehicle Finance.

• Strategic exit from Vehicle Finance completed, simplifying the business, strengthening capital, and supporting reinvestment and shareholder distributions.

• Project Fusion delivered £8m in annualised cost savings, supporting operational efficiency.

• Announced a 5% increase in dividend to 35.5p per share and initiated a £10m share buyback program, subject to regulatory approval.

• Strategic focus on product expansion, digital solutions, and capital discipline to drive >16% ROAE and ~10% annual lending growth.

Financial highlights

• Profit before tax from continuing operations was £59.3m, stable year-over-year.

• Net lending balances grew 8.1% to £3.3bn; customer deposits rose 8.2% to £3.5bn year-over-year.

• Net interest margin stable at 4.7%; cost to income ratio improved to 45.2% (43.7% excluding non-recurring costs).

• Operating expenses rose 3.5% due to non-recurring leadership changes; underlying cost growth mitigated by efficiencies.

• Cost of risk increased to 1.0% (from 0.8%), with impairment charges up due to specific and legacy cases.

Outlook and guidance

• Medium-term targets: >16% ROAE and ~10% annual net lending growth by FY 2028.

• 2026 guidance: 8–10% net lending growth, cost to income ratio ~47%, CET1 ratio ~13.5%, and £10m share buyback.

• Focus on launching new products, accelerating cost management, and maintaining progressive dividend policy.