EarningsQ4 2026 Earnings Report
DE:CS3 Q4 2026 EPS Results
Actual EPS€0.24
Consensus EPS€0.17
Beat/MissBeat by +€0.07
One Year Ago EPS€0.18
DE:CS3 Q4 2026 Revenue Results
Actual Revenue€676.86M
Expected Revenue€371.53M
Beat/MissBeat by +€305.33M
YoY Revenue Growth-9.35%
Earnings Announcement Details
QuarterQ4 2026
Date09/29/2026
TimeBefore Open
Conference CallTuesday, September 29, 2026
DE:CS3 Upcoming Earnings
Close Brothers Group's next earnings date is estimated for March 16, 2027, based on past reporting schedules.
Q4 2026 Earnings Call Audio
DE:CS3 Q4 2026 Earnings Call
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Q4 2026 Earnings Slide Deck
Q4 2026 Earnings Call Summary
Earnings Call Sentiment|Positive
The call was strategically optimistic, with management highlighting recovered loan growth, strong cost execution, improving credit metrics, robust capital and liquidity, and confidence in achieving double-digit returns by FY28. However, current-year income and profit declined, NIM is expected to fall further, the Motor Finance redress provision and legal uncertainty remain significant, Property faces market and impairment challenges, and no FY26 final dividend was declared. Overall, the positive strategic and forward outlook outweighed the stated financial and regulatory challenges.Company Guidance
Strategic Progress and Specialist-Bank Positioning
The group said it had made significant progress against its strategy to simplify, optimize and grow, supporting 1.6 million customers with a GBP 9.5 billion loan book across Commercial, Retail and Property. Simplification is now largely complete following the disposals of Asset Management, Winterflood and Brewery Rentals, the closure of Novitas and the winding down of Vehicle Hire.
Loan Book Momentum Recovered
The headline loan book was broadly flat year-on-year at GBP 9.5 billion, but underlying growth was 2% for the full year and 4% in the second half. All three divisions grew in the fourth quarter, and the group expects underlying loan book growth within its 5% to 10% target range in FY27, subject to market conditions.
Commercial Loan Book Growth
Commercial loan balances increased 3% year-on-year to GBP 4.9 billion and 6% in the second half. Invoice Finance grew significantly in the second half, including 26% half-on-half growth, while specialist areas within Asset Finance also continued to grow.
Retail Growth and Irish Motor Finance Market Share
Motor Finance delivered growth in both the U.K. and Ireland, with record new business in Ireland. Since reentering the Irish market through its 2023 acquisition, Close Brothers increased its market share from 8.5% in 2024 to 13%.
Improved Credit Metrics
The group bad debt ratio was 1%, below its long-term average of 1.2%. In Retail, the bad debt ratio reduced from 1.5% to 1%, benefiting from the updated IFRS 9 model in Motor Finance. Management expects the bad debt ratio to remain below its long-term average in FY27.
Cost Savings Ahead of Schedule
Adjusted operating expenses decreased 3% to GBP 431 million in FY26. The group delivered approximately GBP 36 million of annualized cost savings, ahead of its GBP 25 million target, and now expects to exceed GBP 60 million of annualized savings by the end of FY27.
Future Cost and Efficiency Targets
The group expects FY27 costs to remain broadly stable at approximately GBP 430 million despite inflation and investment in growth. By FY28, costs are expected to be toward the lower end of the GBP 410 million to GBP 430 million guidance range, with an expected efficiency-income ratio below 60%.
Growth and Returns Outlook
Management expects a modest increase in return on tangible equity in FY27 and remains confident in delivering double-digit returns by FY28, rising thereafter. The outlook is supported by 5% to 10% loan book growth through the cycle, a lower cost base and operating leverage.
Strong Capital Position
The CET1 ratio was 14.1% after absorbing the additional GBP 165 million Motor Finance commissions charge. Basel 3.1 is currently estimated to reduce the CET1 ratio by approximately 80 basis points to 13.3% on a pro forma basis, leaving approximately 340 basis points of CET1 capital headroom. The group expects CET1 to operate within its medium-term 12% to 13% range.
Robust Funding and Liquidity
The group maintained GBP 3 billion of liquidity resources and total funding of GBP 11.4 billion, including a diversified and predominantly retail deposit base. Retail deposits represented 57% of total funding, only 10% of deposits were available on demand, and the average cost of funds reduced to 4.6%.
Successful Wholesale Funding Activity
Close Brothers raised GBP 0.5 billion during the year through the refinancing of its Tier 2 securities and the issuance of its first senior unsecured bond since 2020. Management said its funding profile, liquidity pool and capital-markets access provide a strong foundation for future growth.
Property Diversification
Although the build-to-sell market remained challenging, the group reported good early momentum in build-to-rent and purpose-built student accommodation. Property examples included a GBP 20 million revolving credit facility supporting 52 homes with a GBP 47 million gross development value, as well as increased appetite for larger build-to-rent opportunities.
AI and Automation Deployment
The transformation program is incorporating AI, automation and digital solutions. In Commercial, the group deployed Agentic AI to automate the submission and processing of broker proposals, gather and organize information, remove manual tasks, support faster credit decisions and improve the end-to-end broker and customer experience.
Premium Finance Commercial-Lines Expansion
Premium Finance is being repositioned toward commercial lines and higher-quality business. The group is building on partnerships with large commercial-lines insurers and announced a new three-year partnership with JMG, a leading U.K. independent insurance broker.
Group Central-Functions Loss Reduction
The loss from group central functions reduced from GBP 54 million to GBP 37 million, primarily reflecting lower adviser costs.
Property Credit Coverage
Overall bank coverage increased from 2.6% to 2.7% year-on-year. Property coverage was 5.6%, while Stage 3 coverage was 35%. Management described coverage levels and the underlying credit quality as strong, with 90% of the loan book secured.
DE:CS3 Earnings History
The table shows recent earnings report dates and whether the forecast was beat or missed. See the change in forecast and EPS from the previous year.
Beat
Missed