(Reuters) – Secure Trust Bank <STBS.L> said on Wednesday that a 14% drop in the value of used cars on average during the first half of the year had led to higher provisions at its recently launched vehicle finance business.
The lender, however, reported a 13.9% rise in adjusted profit before tax at 18.8 million pounds for the six months ended June 30 on the back of strong loan growth in real estate finance.
Secure Trust, which offers savings accounts and lends to individuals and businesses, said the UK car market experienced “unusually severe seasonal falls” in asset values during the second quarter. Impairment losses climbed 9.2% to 17.8 million pounds.
The company’s comments mirror those from Lloyds Banking <LLOY.L>, one of UK’s big banks, that last month reported a 27% jump in impairments due to weakness in used car prices.
(Reporting by Muvija M in Bengaluru)