The Close Brothers Group has reported an operating loss of £122.4m for the year ended 31 July 2025, in comparison to a £132.7m profit the previous year.

The banking group’s annual results published this morning reported a basic loss per share of 66.9p.

The loss includes a £165m provision related to motor finance commissions. Close Brothers said it awaits the FCA consultation and design of an industry-wide redress scheme before it can adjust this figure.

The firm has also put aside an additional £33m for the financial year for a proactive customer redress programe in motor finance, having identified historical deficiencies in the early settlement of loans.

Close Brothers has had a busy financial year having sold three of its main businesses. The firm said it sold Close Brothers Asset Management, Winterflood and its Brewery Rentals business in order to address legacy issues and reposition the business for growth.

So far its simplification plan has also seen the firm reposition its premium finance business to focus on commercial lines and settle its long-standing litigation with Novitas.

The plan has seen the firm deliver £25m in annual cost savings, with Close Brothers saying it will deliver at least another £20m of annualised savings in each of the next three years.

Earlier this year Close Brothers Group sold Close Brothers Asset Management (CBAM) to Oaktree Capital Management for £200m.

CBAM has now become a standalone new wealth manager with the new name of TrinityBridge.

The sale of CBAM to private equity firm Oaktree was first announced last September.

Mike Morgan, chief executive of Close Brothers Group, said: “Over the last year, we have taken decisive action to address legacy issues and reposition the business for growth. We have sold Close Brothers Asset Management, Winterflood and the Brewery Rentals business, and we have repositioned our Premium Finance business to focus on commercial lines. In addition, we have now successfully settled the long-standing litigation issued by Novitas. Today, we are announcing the next steps on this path by exiting the vehicle hire business.

“Whilst some of these actions have an upfront financial impact on the group, they provide the foundation for the next stage of our journey: driving efficiency and capturing growth.”

He added that Close Brothers expects to return to double-digit RoTE (return on tangible equity) by the 2028 financial year.

Mr Morgan took over as permanent chief executive, following Adrian Sainsbury stepping down from his position to focus on his health, with effect from 6 January.

He took temporary medical leave of absence from the business in September.

Mr Morgan, group finance director for the last five years, assumed Mr Sainsbury’s primary responsibilities when he took his leave of absence.

Mr Sainsbury was appointed group chief executive in 2020, having previously been managing director of Close Brothers’ banking division since 2016 and a director at the bank since 2013.