Shares in merchant banking group Close Brothers closed down 6.68 per cent yesterday as its motor finance business faces compensation costs tied to two marketwide reviews from the Financial Conduct Authority (FCA). Close Brothers said that following a past business review of customer forbearance in its motor finance business, it estimated any compensation costs to be "single-digit millions". RBC analysts have estimated a potential bill of up to £350m, which is nearly half of its current market capitalisation. Excluding the group's recently acquired Irish motor finance unit, Close Brothers continued to expect around eight to 10 per cent growth in banking costs this financial year.

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