Close Brothers has escalated its cost-cutting initiatives, aiming to achieve over £60m in savings by 2027 through offshoring, restructuring, and property reductions. This follows the delivery of £36m in savings during its latest financial year, exceeding an initial target of £25m.
The FTSE 250 bank confirmed on Tuesday that it is progressing with its restructuring programme, which includes a previously announced plan to cut around 20 per cent of its total headcount, equating to 600 full-time roles, by the end of 2027.
Restructuring costs for the last year stood at £14.3m, an increase from £2.3m in 2025, largely due to redundancies. These costs are projected to increase further, reaching between £30m and £40m in the upcoming year.
The bank reported a pre-tax loss of £60.3m for the 12 months to July 2026, which is less than half of the £122.4m loss recorded in the previous year. However, the ongoing motor finance scandal continues to impact the firm, with provisions for a potential payout hiked to £320m earlier this year.
Operating income for Close Brothers decreased by six per cent to £642.9m, and its net interest margin fell from 7.2 per cent to 6.9 per cent. The bank has also opted to cancel its final dividend payment for the third consecutive year, citing uncertainty surrounding legal challenges to the Financial Conduct Authority's motor finance consumer redress scheme.