Arbuthnot Banking Group Sees Mixed Performance in 1H 2025

In the first half of 2025, Arbuthnot Banking Group (ABG) reported notable growth in its low-capital-intensity sectors such as deposits and wealth management. The group also experienced strong performance in specialist lending areas like RAF and leasing businesses, focusing on high risk-adjusted returns. Conversely, certain loan books, including property lending, witnessed a decline as ABG refrains from pursuing projects that fail to meet its target returns.

However, pre-tax profits halved compared to the first half of 2024. The decrease is attributed to the anticipated effects of a declining interest rate environment, reduced private equity activity impacting ACABL operations, and low truck resale profits. Hardman & Co remains optimistic, forecasting higher pre-tax profits for the second half of 2025 and improvement in fiscal year 2026.