CYBG shares surge after swing to first-half pre-tax profit

Shares in NAB spin-off CYBG spiked in early London trade after it booked a first half pre-tax profit.

Pedestrians pass branches of Clydesdale Bank and Yorkshire Bank in London. Picture: Bloomberg

Shares in NAB spin-off CYBG spiked more than 9 per cent in early London trade after the dual-listed bank announced it had swung to a pre-tax profit in the first half of the fiscal year as interest income soared following the acquisition of Virgin Money in October 2018.

The banking group reported a profit before tax of £42 million pounds ($78.3m) for the six months ended March 31, versus a loss of £95m ($177m) in the previous-year period. Income from interest totalled £1.3 billion ($2.42bn), up from £559 million (1.04bn) the year before.

However, CYBG (CYB) said that, if it adjusts the previous-year figures to account for the acquisition of Virgin Money, net interest income fell 1 per cent due to mortgage pricing pressures in 2018.

The common equity tier one, or CET1, ratio — a measure of balance-sheet strength — was 14.5 per cent versus 11.3 per cent in the first half of fiscal 2018.

At 6.30pm (AEST), CYBG London shares were up 9.75 pence, or 5.4 per cent, at £2.015.

Dow Jones