Manx Financial Group (LON:MFX) reported a 9% increase in its share price, reaching 24 pence and peaking at 25.4 pence earlier on Thursday. This surge followed an uptick in the firm's pretax profits for the first half of 2023, attributed to higher interest rates.
The London-based financial services company disclosed a pretax profit of £3.0 million ($3.7 million) for H1 2023, ending on June 30. This figure marks an improvement from the £2.3 million reported during the same period last year.
The firm also noted an increase in net interest income, which climbed to £16.4 million from the previous £10.5 million. Additionally, operating income rose to £16.3 million from £11.7 million.
Deposits within Manx Financial Group also saw growth, reaching £332.5 million from the £304.2 million recorded six months prior. However, this growth was accompanied by a 6% erosion in net interest margin due to rate increases passed on to savers to attract new depositors. The company indicated that this impact is being partially offset by increasing yields, which are expected to bring the net interest margin back to a more normalized position once interest rates begin to decline.
The Executive Chair of Manx Financial Group expressed expectations for challenging market conditions to persist until Q2 next year. Despite these challenges, he anticipates market improvement as interest rates start to decline and remains confident in the continued popularity of the company's current short-term lending products and structured finance products.
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