HTB will continue to provide funding and support to both new and existing asset finance lenders. Credit: Sutthiphong Chandaeng / Shutterstock.

Hampshire Trust Bank (HTB), a provider of development finance and asset finance to UK SMEs, has closed its asset finance division to new business, impacting vehicle stocking.

HTB’s asset finance division generated £170m in net leasing for the 2021/2022 financial year, according to Asset Finance Policy.

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Effective immediately, the decision comes as a strategic move to optimise the use of HTB’s regulatory capital, which has been diminishing due to the bank’s rapid expansion.

Despite the profitability of other divisions within HTB, the asset finance division has been identified as less profitable, leading to this decisive action.

The bank emphasises that this move does not reflect the performance of the asset finance staff, who have been commended for their high-quality service.

HTB said it will continue to provide funding and support to both new and existing asset finance lenders through its block discounting and wholesale speciality finance division.

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This redirection of resources is aimed at bolstering the bank’s position in other specialist lending areas.

HTB group chief executive Matthew Wyles said: “It is HTB’s hugely successful business model which has resulted in this decision and we owe it to our people and our shareholders to do what is right for HTB as a whole.

“We will now concentrate all our available resources on continued growth in our core markets of specialist mortgages, development finance, bridging, block discounting and wholesale speciality finance.

“We have a robust capital base which secures the future of these core businesses for the foreseeable future and will soundly underpin our ongoing growth.”

Last month, HTB appointed Chloe House as the business development manager for the South Coast.