Bank ready to expand SME offering
Clydesdale parent to build new Glasgow HQ
CYBG, owner of Clydesdale Bank, has announced its plans for a new head office and has signed a lease on office space to be built in Bothwell Street, Glasgow.
It will bring together staff located across three sites – its current head office in St Vincent Place, the Guildhall in Queen Street and Granite House in Stockwell Street – as well as a number of smaller sites in other premises in the city.
With leases due to expire in the next few years, it presented the business with an opportunity to review the property portfolio and consider a new approach.
David Duffy, CEO of CYBG, said: “Glasgow is the historical home of Clydesdale Bank, which is why I am delighted to announce our plans to continue to operate in the city for many years to come.
“Glasgow has a vibrant business community and a thriving financial services community, which we enjoy playing an active part in and there is no question about the benefits having all our city centre employees in one central location, in the heart of the financial district.
“The wealth of talent in this part of the country is exceptional, with highly regarded education and training institutions on our doorstep – the new office will improve our operating environment, helping to retain and attract talent.
“We are also embracing technology and innovation and this has allowed us to evolve the way we work across all parts of our business. Our physical environment is an important element of that and this has been an opportunity to review our office space and consider if there are ways we can work better.
“Our new Head Office will offer more flexibility and value for money, while also ensuring our organisation is fit for purpose, both now and in the future.”
The building will be fitted to a bespoke CYBG layout and employees will be involved in the design and specification to ensure it meets the needs of the business.
Mr Duffy added: “We have quite a few details to work out over the next few years, but we wanted to let our colleagues, customers and the city know about our future plans. It’s an exciting development for CYBG. We became an independent bank again just over two years ago and we are encouraged that the business continues to go from strength to strength. This announcement reaffirms our commitment to Glasgow and to Scotland.”
CYBG profits rise tainted by higher PPI costs
CYBG today delivered a sharp increase in underlying profitability in the first half of the year, while the cost of tackling mis-selling issues pushed it into a bottom line loss.
CYBG, which includes Yorkshire Bank, set aside a further £350m to compensate for wrongly-sold payment protection insurance products. It has now used up a £148m indemnity provided by former parent National Australia Bank.
There was an £18m increase in provisions for other legacy conduct charges.
Underlying profit before tax rose 28% year-on-year to £158m. There was a statutory loss after tax of £76m due to payment protection insurance costs.
Its underlying costs fell 7% with income up 1%, delivering an improvement in the underlying cost-to-income ratio to 64%.
The bank, which made no mention of its offer to acquire Virgin Money, said it is “well placed” to be a beneficiary of a small business fund being set up by RBS as an “alternative remedies package” which replaced RBS’s obligation to sell the business formerly branded Williams & Glyn.
David Duffy, CYBG’s chief executive, said: “In the first half of 2018, we have continued to make good progress in delivering our strategic priorities.
“In a competitive market, we have significantly increased underlying profit, up 28% to £158m, while achieving 5% annualised lending growth across both mortgages and SMEs.
“While the economic outlook remains uncertain, CYBG is well positioned to continue executing our existing strategy and to capture future growth opportunities across both our Retail and SME businesses in the year ahead.
“We are also preparing to compete for the opportunities offered by the RBS alternative remedies package in order to scale our regional SME franchise nationally and to build-out an SME offering that provides a credible near-term competitor to the incumbent banks.”