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STB Secure Trust Bank Plc

754.00
-4.00 (-0.53%)
Share Name Share Symbol Market Type Share ISIN Share Description
Secure Trust Bank Plc LSE:STB London Ordinary Share GB00B6TKHP66 ORD 40P
  Price Change % Change Share Price Shares Traded Last Trade
  -4.00 -0.53% 754.00 8,147 11:59:57
Bid Price Offer Price High Price Low Price Open Price
752.00 758.00 760.00 726.00 726.00
Industry Sector Turnover Profit EPS - Basic PE Ratio Market Cap
Commercial Banks, Nec 205.1M 19.7M 1.0329 7.26 144.57M
Last Trade Time Trade Type Trade Size Trade Price Currency
11:59:57 AT 233 754.00 GBX

Secure Trust Bank (STB) Latest News (5)

Secure Trust Bank (STB) Discussions and Chat

Secure Trust Bank Forums and Chat

Date Time Title Posts
14/6/202520:10Secure Trust1,182
23/10/201908:34Secure Trust Bank-

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Secure Trust Bank (STB) Most Recent Trades

Trade Time Trade Price Trade Size Trade Value Trade Type
10:59:57754.002331,756.82AT
10:59:57754.0055414.70AT
10:59:28754.001075.40AT
10:59:28754.0067505.18AT
10:57:23758.0017128.86AT

Secure Trust Bank (STB) Top Chat Posts

Top Posts
Posted at 17/6/2025 09:20 by Secure Trust Bank Daily Update
Secure Trust Bank Plc is listed in the Commercial Banks, Nec sector of the London Stock Exchange with ticker STB. The last closing price for Secure Trust Bank was 758p.
Secure Trust Bank currently has 19,072,078 shares in issue. The market capitalisation of Secure Trust Bank is £143,040,585.
Secure Trust Bank has a price to earnings ratio (PE ratio) of 7.26.
This morning STB shares opened at 726p
Posted at 14/6/2025 19:51 by apple53
I might as well carry on and ignore the tumbleweed on this thread.
I note the rumoured Pollen-Metro discussions. As ever, people may see STB as being too small to be relevant, and in market cap terms the gap is immense. Ironically, however the 2026 earnings forecasts are not in different ballparks. Can we expect a modest push on Monday morning?
Posted at 05/6/2025 22:15 by apple53
Dear Fly

Sorry for the delay in replying to your thoughtful post.

First, re. depositor concern on the back of capital risk: it is intriguing that with capital levels double those pre GFC we could be concerned, but your worry was reasonable. Stopping the dividend wouldn't have made a big difference, but there is/was scope to control balance sheet growth. Nonetheless social media can magnify the tiniest concern. I was in touch with a company advisor encouraging early disclosure of the potential scale of the risk, and was disappointed that nothing meaty was provided for months. The upside was a share price that hit 350p (including some notable institutions giving up at that level). I started buying prematurely, cut by the falling knife, but essentially doubled up below 500p. And then started trading it, plus or minus 10-20% each time with modest chunks.

I take the point about the bond issue. Given lending rates there would potentially be a meaningful margin, but I am not close enough to the market these days to know the specifics, and given the share price the most efficient use of marginal capital was, and still is, a buyback program (ceterus paribus).

I did indeed start selling around 500p, but after doubling up I owned close to half a percent of the company, and there remains a risk of the court case going wrong in a way which (temporarily) hits the share price hard again. I also need to raise cash this year for a home purchase. There are also capital gain considerations, ie further upside is worth less in non-wrapped accounts. I also am a bit too much of a trader......

Essentially my entire banking sector eggs ended up in one basket, having sold small Barclays and larger OSB holdings (the latter traded extensively - looking for a reentry on the next shock!). Also had sold Halyk and BGEO.

It is a little hard to track as the shares are spread across around 8 accounts, but I think I have sold a net quarter or so of our holdings (gross sales more than that but I re-purchased on the Trump-fall and again on the recent profit-taking). Yes of course I should have waited til £6 to start. One way of looking at it is that I have a sort of value cap (as a % of total net worth) for any single holding.

I won't go into detail on my fundamental view of the bank and its 'normal' value - historically 10x earnings at least if both safe and growing with a sustainable 13-15% RoE to fund growth, and even in an era of small cap irrelevance along with only 10-12% RoE surely 6-7x, on cross-cycle provisions, is merited, but yes I still think it is worth £15-20, and I will hold on to a sizeable chunk, cash needs permitting, until at least the post covid highs (not adjusted for dividends). At some point, the upside shrinks to a level that puts it more on a par with alternative investments (HVPE, ONT, APAX, GROW, PSDL), and it makes sense to continue to diversify.

Your point about takeover I would love to believe. I spoke to a vulture-style financials expert when it was trading c. £4 but it was just too small to merit the time required to get comfortable while in the midst of the car finance scandal, plus a larger owner would be less likely, perhaps, to get an easy ride from the regulators. So I agree that a buyer is more likely to appear when all is fine and dandy. A bank buyer would believe it could lower the cost income ratio, but would find it was a false economy as staff and customers walked, while any buyer might say we can accelerate growth by removing the capital constraint. And it IS true that a market cap below £100m is completely off the radar screen whereas £250m might be just about big enough to spark interest, including from some institutional investors, just as 80% of the upside is in the past.......
Posted at 16/5/2025 21:07 by checkers2
From Progressive Research, out yesterday:

Regulatory uncertainty discount appears too deep. The shares still trade at just 0.3x FY24 tangible net asset value per share (1,864p). The current rating does not reflect the progress made towards STB’s Medium-Term Targets and management’s clear roadmap towards a £4bn loan book and ROE target range of 14%-16%, reinforced by today’s trading update.

www.research-tree.com/companies/uk/banks/secure-trust-bank-plc/research/progressive-equity-research/progressive-secure-trust-bank-growth-combined-with-derisking/30_3257f570-fef5-4aa5-9b8e-73af89291f74/42eb6185-321e-4c32-8944-e5ae6810a3de
Posted at 18/4/2025 14:14 by flyfisher
Apple, A more comprehensive reply to our march dialogue.

Last year i had concerns over the capital position of STB. My concern was that any potential negative press comments due to the motor finance issue could cause depositors to flee. STB being predominantly depositor funded and having set tfsme liabilities could have been distressed by this scenario.

The results in march eased my concern, with deposits actually increasing, in contrast to CBG which lost some local authority depositors.

This caused me to look again at STB, for which my own workings are slightly ahead of broker forecasts. On a forward p/e and a trailing p/b STB stands out as value, whilst also offering an attractive yield. I would like to see a bond issue from STB in order to provide funds to grow, but this is not practicable whilst the motor finance review is ongoing.

So motor finance is the major issue, for which i was reassured by the comprehensive review of different scenarios and modest provision, as were you.

My own view is that the broad reading of the appeal court cannot be allowed to stand due to risk of contagion to other areas of business. Accordingly we are likely to have a considerable dilution at the supreme court, which will lead to the FCA issuing a middle ground compensation scheme for which STB has already provided. Yes there is a lot of hope in that.

So, on balance, i see a lending business which is way out of favour due to persistent regulatory meddling, for which the government is rowing back on the regulators, which was distressed with deposit flow concerns, which have been allayed, and is now on a forward p/e of 2.5 and a discount to ntav of 68% whilst also paying a 5.7% div yield.

I have added regularly, in good size, to my holding since the march results, to me it offers value.

I don't understand why you planned to sell at 500p. With such metrics, if the share price does not rise, then a bidder could appear.
Posted at 13/4/2025 22:01 by ball deap
I purchased STB so I wanted to make sure of discretion, I got this for my partner so the comments below are hers. Reviewing STB is difficult because personal taste and preference is hugely important, It's heavy but not too heavy. The head is slightly flexible but not too wobbly as with some.A STB trade has three settings . The bottom one turns on the power, the middle one changes the vibration pattern and the top one changes the intensity of the STB vibration trade. When you first turn it on it comes on at its highest intensity which is a bit scary! It is quite loud on its highest intensity.I really like this trade. I find it comfortable to use and the large range of vibration patterns and intensities mean that everybody should be able to find a setting that suits them. 
Posted at 19/3/2025 14:28 by apple53
Thanks p1nk. I have edited in 3 spots where it was misleading - the second bounce referred to the share price (now changed to recovery), and 'all mine' questions didn't mean all the questions were mine, only that all of mine were asked! Plus 12% for T1.
Posted at 19/3/2025 10:19 by apple53
Yes I did listen. It is definitely worth the time if anyone has or is considering a substantial medium term position. Personally I am impressed and believe there will be a big bounce in adjusted eps in 25 or 26 at the very latest, putting the stock on about 3-3.5x, even after the share price recovery.

There should also be the original presentation on youtube, no? I think I spotted it last week but didn't listen, but I'm not sure if there is a Q & A. On Engage, Phil seemed to ask (paraphrased) essentially every question submitted (including all of mine) and, even though answers were often partial and guarded, overall it was pretty useful.

I could write more but my high level conclusion is below (I posted this on CBG just now where there is more activity, and forgot to note that they see the 12% T1 ratio minimum as non-negotiable, which confirms the confidence I noted in posts above):

QUOTE
So even after the jump in STB's share price, it is cheaper on a PE than CBG using analyst estimates. I have a large holding in STB still. The glitch for me (other than no disclosure on motor finance until the results) has been that analyst estimates (marketscreener rather than stocko which I can't see) had not come down for 25 and 26, while I thought they should have put at least a motor finance hit into them. Well STB results were very good on the all important operating basis (check thread) with impairments continuing to drag down eps. If you listen to one of the two presentations you get very good explanations and there is a high probability of a sharp fall in impairments in 25 allowing the new higher operating profit base to shine through, so earnings power over the next couple of years is 250-300p (share price 575p). Ironically this means that analyst forecasts, at least for 25, might be about right. [NB despite the good results one analyst has already tweaked down 25, but I think it's more of a rounding error, or a catch up since the stock is so small they rarely revise it].

The motor finance provision, based on 37 scenarios weighted for probability, is extremely modest. They accept two way risk, but given they are close to the 12% stated T1 minimum, they must believe that additional downside is very limited (note they grew the div, and still plan to growth the balance sheet materially).
UNQUOTE
Posted at 24/11/2024 17:17 by chabuddy
STB's January 2024 Trading Update stated that between 2014 and 2017, a "mid-single digit proportion of [their] new vehicle finance loans included [discretionary commission arrangements]".

Each FY earnings between 2014 and 2017 confirms that the majority of new business lending was for used rather than new cars. Assuming that 'mid-single digit proportion' = 7% (higher to be conservative), that 50% of new business lending went to new cars (will be less than this, but trying to be conservative), and that they used discretionary commission arrangements for the full year in 2017 rather than only half the year (and the same in 2014, given STB provided no clarity on this; this is conservative given that Moneyway — one of STB's motor finance lending platforms — stated that they stopped using these arrangements in June 2017), I estimate that ~ £15.6m was lent that involved the use of discretionary commission. Redress doesn't equal full refund, and even after applying prejudgment interest I think £15.6m can be seen as the upper bound for the discretionary commission arrangements (the actual figure likely less than half of this).

STB's market cap decline of > £80m post-judgment seems to suggest that the market views a risk of redress for non-discretionary commission arrangements as well, with a consumer rights head saying that "anyone who has already been told by their finance provider they didn’t have discretionary commission on their loan should now be asking if any commission at all was applied."

Clearly the FCA have sh*t the bed on this one, but if significant redress only applies to discretionary arrangements then it looks like STB will be fine. If it applies to non-discretionary arrangements, this will have wide-sweeping consequences across the entire economy, and won't be just limited to motor finance firms.

I personally think at ~£3.5/share, this is increasingly looking like a really good punt, given that pre-judgment sell-side consensus implies that at the current share price it would be trading at < 1.5 P/E within 2 years!
Posted at 16/10/2024 14:15 by smithie6
a comparison of STB shares with the shares of another lender, MFX.

=========

btw

another company doing lending in the UK, lse:stb
..it has a p/e of ~6, double the p/e of 3 for MFX.

I guess that MFX perhaps deserves a lower p/e because with a cap. value of only £18m many institutions/fund surely are not able to own any shares in MFX, (& some PIs avoid companies with such a small cap. value) whereas STB has a cap. value of ~£150m, where many institutions/funds are allowed by their own rules to invest.

but being half price in comparison, that looks way overdone imo.

------

How do STB & MFX compare for growth

2019 & 2023. Revenue
(data taken from financial summary page of advfn)

STB. £165m. £185m. % increase = 1.1
MFX £26.7m. £53.3m % increase = 2.0
(revenue 2023/revenue 2019)

(MFX. doubling the revenue in 4 years, impressive)

For revenue growth MFX wipes the floor with STB, yet the p/e of MFX is half that of STB !
Doesn't make sense imo.

imo either STB is too expensive or MFX is too cheap !
Posted at 02/3/2024 19:56 by apple53
MrScruff,

I agree this is a great opportunity for investors. I don't agree with your view on rates or growth etc., and I wrote the following to remind myself of history and the investment case for these banks.

Higher rates tend to benefit earnings, though much higher rates are typically thought likely to increase bad debt charges. Materially higher rates and a high recession risk is normally enough to hit multiples. [it is important you don't have silly regulators that require you to buy reams of government bonds at low interest rates - this is what killed SVB and, arguably, First Republic].
Overall, though, there isn't really any correlation between rates and multiples.
'Any growth' doesn't tend to drive the share price violently up. Balance sheet growth requires capital, and more than it used to under Basel 1/2. In the case of STB the drive for rapid growth probably hit the share price, as it required a dividend cut, and also because some shareholders are rightly scared of rapid growth in bank balance sheets. One of the clearest correlations (with causation) in banking is rapid growth and subsequent high (sometimes disastrous) bad debts.
Bank investors 'normally' like modest balance sheet growth, faster growth in fee income, a low level of dealing income and an expectation of a falling cost income ratio.

Historically, banks have traded at 8-15x forward eps. It is only in the past few years that 5x earnings has been considered normal, and this in Europe, but not the US, where 9-12x is more typical.

What is doubly weird about the ridiculously low multiples is that UK banks are much much safer than they used to be. Equity capital ratios are 2.5-4x higher than in the noughties. [There is a downside to this - RoEs are lower, and incremental growth needs more incremental capital]. They are also encouraged to ex-ante provision (which is good as it helps to smooth provisioning across the cycle). Overall CoE should be lower.

None of this means that banks are immune to property market collapses. Some (US) banks are over-exposed to commercial property (NYCB). This has been the cause of most bad debt crises (as opposed to the liquidity crisis post-Lehman). Resi mortgages are also at risk from a big increase in unemployment, double digit interest rates, 40% falls in value (each in isolation) or a milder combination of the 3.
The other risk to banks is social media, which magnifies problems that used to swept under the carpet, such that issues which might have been manageable with a couple of year's retained earnings can now be enough to cause a run.

STB is probably the weirdest example (and could be the cheapest bank in the developed world), but OSB stands out even more. STB is tiny; OSB merely small. STB is building a growth track record; OSB already has one. STB is modestly profitable; OSB is very profitable (for a modern bank). STB is modestly at risk from an increase in bad debts; OSB is highly cushioned - it has SUCH a low cost income ratio that its leverage to an increase in bad debts is almost the lowest in the industry. If it was 10x the size and based in the US it would trade at twice the valuation or more.

I have no idea when this situation will 'normalise', but in the mean time these banks need to buy back their stock (and I would happily forgo some yield to fund this).
Secure Trust Bank share price data is direct from the London Stock Exchange

Secure Trust Bank Frequently Asked Questions (FAQ)

What is the current Secure Trust Bank share price?
The current share price of Secure Trust Bank is 754.00p
How many Secure Trust Bank shares are in issue?
Secure Trust Bank has 19,072,078 shares in issue
What is the market cap of Secure Trust Bank?
The market capitalisation of Secure Trust Bank is GBP 144.57M
What is the 1 year trading range for Secure Trust Bank share price?
Secure Trust Bank has traded in the range of 337.00p to 908.00p during the past year
What is the PE ratio of Secure Trust Bank?
The price to earnings ratio of Secure Trust Bank is 7.26
What is the cash to sales ratio of Secure Trust Bank?
The cash to sales ratio of Secure Trust Bank is 0.7
What is the reporting currency for Secure Trust Bank?
Secure Trust Bank reports financial results in GBP
What is the latest annual turnover for Secure Trust Bank?
The latest annual turnover of Secure Trust Bank is GBP 205.1M
What is the latest annual profit for Secure Trust Bank?
The latest annual profit of Secure Trust Bank is GBP 19.7M
What is the registered address of Secure Trust Bank?
The registered address for Secure Trust Bank is ONE ARLESTON WAY, SOLIHULL, B90 4LH
What is the Secure Trust Bank website address?
The website address for Secure Trust Bank is www.securetrustbank.com
Which industry sector does Secure Trust Bank operate in?
Secure Trust Bank operates in the COMMERCIAL BANKS, NEC sector

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