Date set for demerger from NAB
Clydesdale Bank heads for £2bn IPO in February
The date was revealed as parent company National Australia Bank released nnual figures showing encouraging growth in the underlying UK business, while asset quality continues to improve.
NAB will hand between 75% of Clydesdale and Yorkshire bank shares to its own shareholders and float the remaining shares on both the London Stock Exchange and the Australian Securities Exchange. The flotation is likely to value the two banks at about £2 billion, qualifying them for entry to the FTSE250.
The Melbourne bank confirmed in May that it planned to float its British banks and appointed Morgan Stanley to oversee the process.
Today’s figures show earnings down £2m or 1.3% to £156m. Customer lending is up £1.1bn or 4% to £28.7bn while retail lending rose by £2bn or 10.2% to £21.6bn. The underlying capital reserves have strengthened.
However, business lending was down by 11.3%, to £7.1bn compared to the previous year due to the managed run-off of lower yielding assets combined with subdued demand for credit and competitive pressures.
In the second half of the financial year Clydesdale Bank set aside an additional £465 million in conduct provisions, of which £390m was to compensate for mis-sold payment protection insurance.
Charges for bad and doubtful debts fell by £42m, or 52.5%, to £38m, reflecting a reduction in business lending charges as a result of the improving operating environment across all asset classes.
David Duffy (right), chief executive, said: “These are positive results that demonstrate the work we are doing to build a better bank for customers and to position ourselves for an independent and successful future.
“Our continued investment in our products and services for our customers is having a positive impact, helping us to grow deposits and increase lending to customers. Going forward we are investing in our digital capability to offer customers greater convenience and an improved customer experience.
“Our balance sheet is robust, with improved asset quality and stronger capital ratios. We are challenging the way we have worked historically, questioning the commercial viability of everything we do and creating more agile working practices.
“By keeping our focus on how and what we deliver for customers we have created a strong platform on which to build an exciting future for us as an independent bank. In doing that, I believe we have the ability to offer our customers an attractive alternative to the status quo of banking in the UK.”
Clydesdale Bank was established in 1838 in Glasgow. It has more than 140 retail branches and a network of Business & Private Banking Centres. Clydesdale, along with The Royal Bank of Scotland and Bank of Scotland prints its own banknotes. It was independent until it was purchased by the Midland Bank in 1920. It was sold to the Melbourne-based National Australia Bank in 1987. Notable chief executives include Fred Goodwin who made his name at the bank and was offered the opportunity to become chief executive of NAB. His wife decided she wanted to remain in Scotland and Mr Goodwin later moved to RBS.
Yorkshire Bank was founded in 1859 in Halifax, West Yorkshire by Colonel Edward Akroyd. Today, with its head office in Leeds, the Bank has around 180 branches, plus 22 Business & Private Banking Centres in the north of England and the Midlands. It operates as a division of Clydesdale under its banking licence.