The bank's explanation for the result demonstrates how rate cuts can compress the rate margin for banks, and hence result, as in this case. Meanwhile, assets under management rose over the reporting period.

Arbuthnot Banking Group, the UK-listed holding company of Arbuthnot Latham, has announced that its pre-tax profit for the first half of 2025 has halved from a year before to £10.9 million ($14.7 million). 

Cuts to Bank of England base rates hit the bottom line, the group said.

Shares in the group were down a touch at the close yesterday. However, since the start of January, they’ve risen more than 6.5 per cent. 

The UK group raised its interim dividend by 10 per cent on a year earlier to 22 pence per share, to be paid on 26 September, it said in a statement yesterday.

The lender had a Common Equity Tier 1 ratio of 12.7 per cent, widening from 11.6 per cent at the end of June last year.

Client deposits stood at £4.42 billion as of 30 June 2025, against £3.86 billion a year earlier and £4.13 billion at the end of December. Client loans, including leased assets, fell by 4 per cent in the first six months of the year.

Funds under management and administration were £2.38 billion at the end of June, up from £1.96 billion a year before; there were £127 million of net inflows in the half-year period, it said.

“The continued strength of the business is reflected in the decision to increase the interim dividend by 10 per cent even though, as anticipated, this year's results reflect the effect of a series of reductions in base rate over the last twelve months,” Sir Henry Angest, chairman and CEO of Arbuthnot, said. "Arbuthnot has continued to grow the overall business and in particular its relationship deposit base, funds under management and specialist commercial lending.” 

Kevin Barrett, head of commercial and private banking, Arbuthnot Latham, explained the firm’s strategy to WealthBriefing in this May interview.