Secure Trust Bank : 2017 Third Quarter Trading Update

PRESS RELEASE

18 October 2017

For immediate release

SECURE TRUST BANK PLC

2017 Third Quarter Trading Update

Secure Trust Bank PLC and its subsidiaries ('Secure Trust Bank' or the 'Group') provide a trading update in relation to the third quarter. As highlighted in the interim results, the Group's loan book has continued to grow and the business has traded in line with management expectations during the third quarter.

The Group believes Secure Trust Bank's continuing strategic repositioning, with a move away from higher risk, consumer unsecured and sub-prime motor products remains the correct course of action and aligns with the UK's economic and regulatory backdrop. Given the ongoing economic uncertainty and recent cautious regulator commentary about certain consumer credit sectors, the Group is continuing its cautious stance.

The Group's Business Finance operations continued to make progress in Q3 with the Group's exposure to large prime central London house building continuing to reduce.

The Group's Consumer Finance operations also performed as expected. During the period the Group launched a new Retail Finance proposition which supports the relationship between V12 Retail Finance and retailers and provides consumers with an additional source of finance. The new proposition has initially been launched in conjunction withAO.COM. V12 will continue to receive credit applications as before and accept those that meet the Group's credit criteria. Simultaneously the remaining applications will be presented to an additional lender whose risk criteria may differ to those of the Group, resulting in an increase in the overall percentage of applications for which finance is provided. This benefits the retailer through increased sales. V12 benefits from an improved relationship with the retailer without having to increase its own risk profile whilst increasing non-risk income. The additional lender benefits from the use of V12's technology and relationships as a loan distribution channel.

The Group continues to shift the emphasis of its Motor business to lower risk, lower margin lending and the run off portfolios in unsecured personal lending and sub-prime motor have performed as expected during the period.

The new deposit platform has been successfully implemented. This was a major IT programme which, as previously highlighted, will confer several benefits for the Group, enhancing the offering, providing internet banking, improving efficiency and risk controls while providing flexibility for future products. The Group continues to see strong demand for its deposit products. A standstill in raising deposits was in place ahead of the switchover in order to facilitate a smooth transition. The Group has therefore been more active than usual during the third quarter in the deposit market in order to prefund lending activities in advance of the switchover.

The Group has also made considerable progress during the period with its preparations for the implementation of IFRS9. The Group's continues to refine its IFRS9 models whilst seeking clarity about proposed regulatory and transitionary treatments. The Group will provide further guidance on IFRS9 implementation in due course.

Enquiries:

Secure Trust Bank PLC

Paul Lynam, Chief Executive Officer

Neeraj Kapur, Chief Financial Officer

Tel: 0121 693 9100

Stifel Nicolaus Europe Limited (Joint Broker)

Robin Mann

Gareth Hunt

Tel: 020 7710 7600

Canaccord Genuity Limited (Joint Broker)

Andrew Buchanan

Sunil Duggal

Tel: 020 7523 8000