Hampshire Trust Bank doubles customer base in past year

Specialist lender Hampshire Trust Bank is hunting for acquisitions as it ramps up expansion after more than doubling its customer base.

Chief executive Mark Sismey-Durrant revealed the group was on the lookout for deals at the right price to support ambitious growth plans.

The challenger bank, which focuses on lending to small and medium-sized businesses (SMEs), ended 2016 with more than 16,000 customers, up from around 7,500 a year earlier.

Around 6,000 of those were signed up in the last six months alone, boosted by the launch of an online savings platform at the end of 2016.

It now has around 11,000 individual and business savers.

Mr Sismey-Durrant told the Press Association the bank had grown organically until now, but was keen to secure a deal to grow its balance sheet.

He said while previous potential bid targets had been too expensive, the group would consider "acquisition opportunities" if the price was right.

"Acquisitions are an effective way of putting on balance sheet growth," he said.

But he added it "remains a competitive space".

Hampshire Trust moved into larger London headquarters earlier this month in the latest stage of its growth plans - a significant milestone for the group.

"It marks the fact that we have come of age," said Mr Sismey-Durrant.

Hampshire Trust was founded in 1977, but relaunched after it was acquired in May 2014 by a new management team with the backing of private equity firm Alchemy.

It made its first profit in December 2015 following the management buyout and notched up £1.3 million in earnings for the six months to June 30 2016.

The group recently made a number of key appointments, signing up a chief operating officer and managing director of asset finance.

It is also recruiting across the wider business, with plans to increase its workforce from 115 to around 150 by the end of the year.

Mr Sismey-Durrant said full-year results next month will confirm that growth continued at a solid pace in the second half of 2016.

He said: "We had a very good last year.

"We had a good first half and that was sustained."

The group plans to grow its fledgling commercial mortgage business further, having launched into the sector last year, while also expanding its asset finance division.

Hampshire Trust is financing the construction of more than 1,500 residential units for UK housebuilders and the vehicles and equipment for more than 4,200 SMEs.

Mr Sismey-Durrant said the group had seen no sign yet of reduced demand from SMEs, despite signs in the wider economy that Brexit uncertainty is hitting business investment.

He confirmed that business volumes in its asset finance division are "holding up as they have done throughout last year".

The group, which is 99% owned by private equity firm Alchemy, said last year it would consider a stock market flotation, but Mr Sismey-Durrant said this was unlikely in the immediate future due to Brexit uncertainty.