Secure Trust Bank profit rises 9.4% as app sign-ups grow

Secure Trust Bank's adjusted profit before tax rose 9.4% to £31.3m in the six months to 30 June 2026, the specialist lender said in unaudited interim results published on 13 August 2026. Net lending across its continuing businesses grew 4.9% to £3,456.6m, and more than 660,000 customers had registered for its Retail Finance mobile app by the end of June, up from more than 475,000 at 31 December 2025.

The figures affect UK borrowers who take point-of-sale finance through the bank's V12 Retail Finance arm and the retailers that distribute those loans, businesses that borrow through Secure Trust Bank's separate Business Finance arm, and Secure Trust Bank shareholders, who received a higher interim dividend, paid on 24 September 2026. The results are the first published since the sale of Consumer Vehicle Finance completed in February 2026, a move management casts as a deliberate narrowing of the business toward retail and business lending; new Vehicle Finance lending had in fact stopped the previous July, well before this reporting period began.

The headline growth sits alongside a less flattering set of numbers: new lending across continuing businesses fell 1.6% year on year, and the bank's operating costs and cost-to-income ratio both worsened despite a stated cost-reduction programme. Secure Trust Bank is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority.

Profit, on three different measures

Secure Trust Bank reports profit on more than one basis, and the three figures are not interchangeable.

The adjusted figure, the one the company highlights, excludes £1.4m of continuing-business items: £0.9m for the cost-management programme and £0.5m for senior leadership changes. Total profit before tax, which rose by a much larger 40.8%, includes an £11.9m accounting profit on the sale of Consumer Vehicle Finance, so it is not directly comparable with the adjusted continuing figure. Readers comparing Secure Trust Bank's results with other half-year statements should check which of the three bases is being quoted.

Lending grew, but new business shrank

Outstanding net lending from continuing operations rose 4.9% in the six months to £3,456.6m, with Retail Finance lending up 4.3% to £1,529.6m and Business Finance lending up 5.3% to £1,927.0m.

That growth in outstanding balances sits against a fall in new lending written during the period. Across continuing businesses, new lending fell 1.6% year on year to £1,066.2m. Retail Finance new business rose 6.2% to £751.9m, but Business Finance new business fell 16.2% to £314.3m — a decline of £60.6m that was larger in cash terms than Retail Finance's £43.8m increase, pulling the total down.

The two trends are not contradictory: a book can keep growing even as the pace of new lending slows, because existing loans continue to run their terms. But the fall in new business is a signal worth watching if it persists, since it is new lending, not the back book, that drives future balance growth.

What the 660,000 figure actually measures

Secure Trust Bank's interim materials state that more than 660,000 customers had registered for the V12 Retail Finance mobile app by 30 June 2026, compared with more than 475,000 at 31 December 2025. That is a registration count, not a measure of how many people actively use the app, how often they return to it, or whether each registration represents a distinct customer. The company has not disclosed active-user or usage-frequency data alongside the registration figure.

Both the December and June figures are given as lower bounds — "more than" 475,000 and "more than" 660,000 — so the exact scale of the increase since December cannot be calculated from the disclosed numbers; the disclosed threshold simply rose from one figure to the other. A reader should treat "660,000 users" as shorthand for registrations, not as evidence of a comparably sized active customer base.

Retail partnerships widen the distribution network

Secure Trust Bank said it had signed 19 home-improvement retailers by 30 June 2026 and subsequently secured multi-year Retail Finance agreements with Magnet and Centrica British Gas. The interim report does not disclose the value of these agreements, the lending volumes they are expected to generate, or when lending under them will begin.

More broadly, the bank's Retail Finance network comprised more than 800 retail partners and provided finance to about 1.3m customers at 30 June 2026. Interest-free products accounted for 86.2% of Retail Finance balances in the first half, slightly down from 87.0% a year earlier, meaning a small but growing share of balances now carries interest. Interest-bearing balances cost borrowers more over the life of the loan than interest-free balances, when both are repaid according to their respective terms.

Life after vehicle finance

Secure Trust Bank stopped writing new Vehicle Finance lending on 2 July 2025 and completed the sale of its Consumer Vehicle Finance business to funds managed by LCM Partners on 25 February 2026, with customer migration finishing in May 2026. The sale generated an £11.9m accounting profit and released £293.9m of risk-weighted assets in the first half of 2026. Risk-weighted assets are the denominator used in regulatory capital ratios, so reducing them strengthens the bank's capital capacity without directly converting into an equivalent sum of deployable cash.

The exit concentrates the group's continuing lending in Retail Finance and Business Finance.

Cost savings announced, but costs still rose

Secure Trust Bank said it delivered £5.5m of cost savings in the first half of 2026, and expects an annualised run-rate saving of about £15m from 1 July 2026, based on full-time employee numbers falling from about 845 at 30 June 2025 to about 650 at 1 July 2026 — a reduction of roughly 195 people, or 23%.

Despite this, adjusted operating costs rose to £39.5m in the first half of 2026 from £36.3m a year earlier, and the adjusted cost-to-income ratio worsened to 46.5% from 45.5%. On a reported basis, operating costs rose to £40.9m from £37.1m, and the cost-to-income ratio rose to 48.2% from 46.5%. Management attributed the higher cost base mainly to central costs reallocated to continuing operations after the vehicle-finance exit, along with investment in growth initiatives. Even allowing for that explanation, the cost base rose and the ratio moved the wrong way in the same period that the bank reported savings; a reader should weigh both figures rather than the savings claim alone.

Capital position, dividend and buyback

The bank's Common Equity Tier 1 ratio — a measure of the highest-quality capital a bank holds against its risk-weighted assets — rose to 14.3% at 30 June 2026 from 12.9% at 31 December 2025, helped by the capital released from the vehicle-finance sale.

The board approved a 12.4p-per-share interim dividend, up 5.1% from 11.8p in the corresponding 2025 period, payable on 24 September 2026 to shareholders on the register at close on 28 August 2026. By 13 August 2026, the first £5m tranche of a planned £10m 2026 share buyback was complete. Dividends and buybacks reflect board decisions taken in light of the group's current capital position; neither is a guaranteed or predictable return, and shareholders bear the risk that future distributions could change if the group's performance or capital needs shift.

Guidance for the rest of 2026

Secure Trust Bank retained its guidance for the full 2026 year: net-lending growth of 8%–10%, an improvement in risk-adjusted margin of about 10 basis points, a cost-to-income ratio of about 47%, and a Common Equity Tier 1 ratio of about 13.5%. This is company guidance, not an independently verified outcome, and remains subject to credit, economic, regulatory and execution risk over the remainder of the year.

What to watch next

These are the first interim results published since the Consumer Vehicle Finance sale completed, and they show a bank growing its lending book while its underlying cost ratios move the wrong way, and expanding a retail-finance app whose actual customer engagement remains undisclosed. Investors and borrowers alike have several things to look for before judging whether this represents a durable shift: audited full-year 2026 results, any data Secure Trust Bank publishes on app usage rather than registrations, confirmed lending volumes from the Magnet and Centrica British Gas agreements, and whether the cost-to-income ratio moves toward the bank's own 47% guidance by the year end. The company's interim report and press release, both published through its investor relations pages, remain the primary source for that detail.