By Rupert Hargreaves
Weatherbys, the private bank founded in 1770, reported a jump in profit before tax as the lender benefited from higher interest rates and growth into new markets.
In itsannual report, published on Thursday, the company said profit before tax rose from £15.2m in 2022 to £33.1m for 2023. The lender’s return on equity rose 34.2 per cent, while its net interest margin—the difference between the rate of interest paid out to depositors and the rate charged to borrowers—rose to 4.82 per cent.
Weatherbys Group is comprised of Weatherbys Private Bank, Weatherbys Racing Bank, Arkle Finance and insurance broker Weatherbys Hamilton LLP. It serves 21,000 clients from eight offices throughout the UK and specializes in serving owners of racehorses.
Weatherbys Racing Bank offers three bank account options: Racing, Multi Owner, and Racing Gold. The accounts are aimed at “UK resident sole or joint owners looking to separate their racing finances from their day-to-day banking.” The bank also offers other products tailored to the racing community.
The group serves high-net-worth (NHW) clients and charges £75 a month for its current account (it’s free for clients who have £300k of assets or borrowing with the group).
During the year, the group added 51 new employees, bringing staff numbers to 422 in 2023. The total assets of the group now stand at £1.64bn.
It ended the year with a liquidity coverage ratio of 896 per cent, far exceeding the regulatory minimum.
Weatherbys focus on NHW and racing clients has helped the business outperform the wider banking market.
The UK’s big four banks have come under pressure recently to pass higher interest rates onto customers, which has hit net interest margins. Lloyds Bank reported a net interest margin of 2.95 per cent in the first quarter of the year, while Natwest’s margin fell to 2.05 per cent in the first quarter. Both lenders also reported a return on equity in the low teens compared to Weatherbys’ 34.2 per cent.
Group Chairman Roger Weatherby said: “As a family-owned bank, we can take a generational view – not one focused on short-term or even medium-term goals chasing additional returns that might lead to undue risk exposure.
“Clients expect us to prioritise the safety of their wealth above all else, and our commitment to this is reflected in the conservative way we have managed the balance sheet. While this can mean foregoing the opportunity for greater profits, it delivers undoubted financial strength,” Weatherby added.
