- Challenger bank Charter Court posted a more 40% rise in pre-tax profits as 'substantially higher' net interest income and improving cost efficiencies boosted performance.

For the 12 months to 31 December, profit before tax rose 42% to £158.2m and earnings grew to 50.1p a share from 35.0p a year earlier.

Net interest income rose 25.3% to £180.5m for the year, up from £144.1m a year earlier, despite a modest decline in net interest margin to 3.08% from 3.17% a year earlier.

The cost income ratio was reduced to 28.7% from 34.1% a year earlier.

The company announced its first full-year dividend of 12.7p per share.

'Charter Court has a robust pipeline going into 2019 and has made a positive start to the year. In line with our strategy, we remain focused on delivering strong loan book growth, whilst maintaining high levels of efficiency and a low cost of risk,' the company said.

'Reflecting this strong performance, the Board has proposed a final dividend of 9.9 pence per share, bringing the total 2018 dividend to 12.7 pence per share, which represents an inaugural payout ratio of 25%, ten percentage points higher than initially proposed at the time of our IPO in 2017,' said Ian Lonergan, CEO of Charter Court.

'With a resulting CET1 Ratio of 15.7%, against 15.6% last year, we continue to generate significant capital and remain strongly positioned for future growth in our specialist markets.'

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