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HBOS PLC full-year profit up 3.8 percent

HBOS PLC full-year profit up 3.8 percent

HBOS PLC, Britain's biggest mortgage lender, reported Wednesday that profit rose 3.8 percent in 2007 compared to the previous year, despite taking a writedown of 227 million pounds (euro301 million US$447 million) on investments.
The company, parent of Bank of Scotland and Halifax, reported net profit of 3.93 billion pounds (euro5.2 billion US$7.74 billion), up from 3.82 billion pounds in 2006.
Results were broadly in line with market forecasts, but the writedown figure was up from 180 million pounds announced in December.
The company also reported paying out 135 million pounds (euro179 million US$266 million) in insurance claims due to summer floods in Britain.
HBOS shares were down 6.8 percent at 657 pence (euro8.72 US$12.95) on the London Stock Exchange.
"The share price reaction to these numbers is a reflection of the disappointment which lays below some of the headline figures," said Richard Hunter, analyst at Hargreaves Lansdown Stockbrokers.
"An erosion of net interest margin, additional writedowns resulting from the credit crunch, and a slowdown in lending all contributed to the malaise surrounding the results."
HBOS also felt the impact of a generally tougher mortgage market, Hunter said.
"One of our concerns over HBOS has been the large wholesale funding element of the balance sheet _ near 100 billion pounds," said Alex Potter, analyst at Collins Stewart.
He noted that HBOS management said this was having some effect on margins, which Potter believed would increase this year.
The bank said its credit experience "remained relatively benign throughout 2007."
"In common with industry expectations going forward we expect some modest deterioration in certain sectors and markets, consistent with the general global economic slowdown."
HBOS is Britain's sixth-largest bank by market capitalization.
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On the Net:
http://www.hbosplc.com


Updated : 2021-08-02 16:21 GMT+08:00