Close Brothers’ commercial finance book, comprising asset and invoice finance, hit £2.6bn (€2.9bn) in the six months to January 31, up 2% from the first half of the year.

The asset finance book grew by £40m, or 2% from H1. Total portfolio remained stable at around £2bn. Close Brothers said the growth had been driven by the more specialist product lines.

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The invoice finance book also grew 2.1%, reaching £546.7m. The rise was helped by the acquisition of Novitas, which provides financing on legal fees, in early 2017.

Close Brothers also reported good demand for ABL, particularly in the bigger ticket segment.

Operating income for commercial banking was £110.4m, up 5% year-on-year. Operating profits grew 9% to £39.7m.

The group cited an improvement in arrears and collections, which pushed bad debt ratio down to 0.4%.

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Close Brothers said it saw “no change to the benign credit environment” for lending, and that it would “maintain pricing discipline in the face of ongoing competition in the asset finance market”.

Operating expenses were up 6% to £65.1m. Close Brothers said this was the result of ongoing initiatives, such as the technology acquisition business and the expansion of asset finance operations to Germany, where the group obtained a full banking licence early last year.

Preben Prebensen, group chief executive, said: “We are pleased with our performance and progress in the first half, delivering higher profit while staying true to our client and customer focused model, and maintaining our prudent and disciplined approach.

“All our businesses have achieved a good performance year to date, and we remain well positioned for the full year.”

“Longer term, we are confident that the consistent application of our business model, along with our strong customer relationships, the expertise of our people and the quality of our service will allow us to continue performing well in all market conditions.”