Arbuthnot Banking Group

Website: Arbuthnot Banking Group
Index: AIM
EPIC: ARBB
Supersector: Financial Services
Sector: Financial Services
Subsector: Specialty Finance
Market Cap: £143.07M
Payout Frequency: Semi-Annual

Arbuthnot Banking Group Dividend Analysis and Summary

Declared dividend and key dates

Final dividend: 31p per share (Ordinary and Ordinary Non-Voting)
Total FY2025 ordinary dividend: 53p (Interim 22p + Final 31p)
Ex-dividend date: 16/04/2026 (derived from record date)
Record date: 17/04/2026
Payment date: 29/05/2026
Policy/stance: Board reiterates a progressive ordinary dividend policy
Comparatives:
- Final up 2p YoY (31p vs 29p)
- Ordinary DPS up 4p YoY (53p vs 49p); prior year included a one-off special 20p (FY2024 total 69p)

Payout, cover and affordability

EPS: 109.1p (2024: 152.3p)
Dividend cover: ~2.1x (EPS 109.1p / DPS 53p) — comfortably covered despite lower earnings
Capital and liquidity: CET1 13.3% (2024: 13.2%), Total Capital Ratio 15.4%; loan-to-deposit ratio 49.1%; surplus liquidity of £1.42bn above regulatory minimum

Dividend sustainability and outlook

Earnings stepped down (PBT £24.2m vs £35.1m) mainly from lower net interest income and AAG headwinds, but the ordinary dividend still shows 2.1x cover — supportive for the increased final.
Balance sheet strength (robust CET1, sizeable liquidity buffer, conservative LDR) underpins capacity to sustain the ordinary dividend through the cycle.
Management continues capital discipline (slower lending at suboptimal returns; preserving capital ahead of Basel 3.1). This prudence supports dividend dependability.
Growth levers: deposit franchise expanding (+11% YoY), Wealth Management FUMA +21% with profitability targeted toward end-2026; early 2026 normalisation noted in AAG’s trading.
Offsetting factors: margin pressure (average net margin 4.7% vs 5.1%), cost inflation and competitive pricing could keep earnings constrained near term.

Capital allocation and policy signals

Progressive ordinary dividend confirmed; 2024’s special (20p) not repeated — clean base now at 53p ordinary.
Basel 3.1: Board plans to remain on the Basel rule book (not SDDT). Withdrawal of the “Refined approach” expected to lift capital requirement by ~£20m. Management has planned for this; near-term RWA/capital headroom prioritisation is evident.
Buyback authority (up to 10%) to be renewed; no purchases in the year — cash returns currently focused on the ordinary dividend.
No demergers/M&A/share consolidation announced.

Risks and flags for dividend stability

Earnings pressure: reduced NII from lower base rates and intense competition; AAG residual value risk (though market conditions have begun to normalise in early 2026).
Regulatory capital: Basel 3.1 change (+~£20m capital need) could temper dividend growth if earnings lag.
Macroeconomic/geopolitical: uncertain rate path and geopolitical risks could weigh on activity and margins.
Cost inflation and ongoing investment (digital programme through 2027) may pressure cost/income until benefits realise.

Bottom line for income investors

The 31p final (ex-16/04/2026) raises the ordinary base to 53p, now clean of specials and covered ~2.1x.
Strong capital/liquidity and prudent allocation support sustainability; near-term dividend growth likely measured until margin and subsidiary profitability (AAG/Wealth) improve and Basel 3.1 settles.

Dividends Used in Calculation:

Ex-Dividend Date	Payment Date	Type	Amount	Currency
17/04/2025	30/05/2025	Final	29.00p	GBX
28/08/2025	26/09/2025	Interim	22.0000p	GBX

Total (Annual Dividends Per Share): 51.00p

Dividend Yield = Annual Dividends Per Share (51.00p) ÷ Share Price (895p) = 5.7%

Ex Dividend Date	Payment Date	Type	Amount	Currency
16/04/2026	29/05/2026	Final	31.0000p	GBX
28/08/2025	26/09/2025	Interim	22.0000p	GBX
17/04/2025	30/05/2025	Final	29.00p	GBX
06/06/2024	20/06/2024	Interim	20.00p	GBX
06/06/2024	20/06/2024	Special	20.00p	GBX
18/04/2024	31/05/2024	Final	27.00p	GBX
24/08/2023	22/09/2023	Interim	19.00p	GBX
20/04/2023	02/06/2023	Final	25.00p	GBX
25/08/2022	23/09/2022	Interim	17.00p	GBX
21/04/2022	31/05/2022	2nd Interim	22.00p	GBX
26/08/2021	24/09/2021	Interim	16.00p	GBX
25/02/2021	19/03/2021	Special	21.00p	GBX
25/07/2019	16/08/2019	Interim	16.00p	GBX
25/04/2019	17/05/2019	Final	20.0p	GBX
30/08/2018	28/09/2018	Interim	15.00p	GBX
26/04/2018	18/05/2018	Final	19.00p	GBX
31/08/2017	29/09/2017	Interim	14.00p	GBX
13/04/2017	12/05/2017	Final	18.00p	GBX
20/10/2016	18/11/2016	Special	300p	GBX
01/09/2016	30/09/2016	Interim	13.00p	GBX
30/06/2016	27/07/2016	Special	25.00p	GBX
14/04/2016	13/05/2016	Final	17.00p	GBX
03/09/2015	02/10/2015	Interim	12.00p	GBX
16/04/2015	15/05/2015	Final	16.00p	GBX
04/09/2014	03/10/2014	Interim	11.00p	GBX
16/04/2014	16/05/2014	Final	15.00p	GBX
23/10/2013	22/11/2013	Special	18.00p	GBX
04/09/2013	04/10/2013	Interim	11.00p	GBX

Year	Interim	Final	Special	Currency	Total	Change
2024	20.000	27.000	20.000	GBX	67.000	52.270
2023	19.000	25.000		GBX	44.000	12.820
2022	17.000			GBX	39.000	5.400
2021	16.000		21.000	GBX	37.000	2.770
2019	16.000	20.000		GBX	36.000	5.880
2018	15.000	19.000		GBX	34.000	6.250
2017	14.000	18.000		GBX	32.000	-90.980
2016	13.000	17.000	325.000	GBX	355.000	1,167.850
2015	12.000	16.000		GBX	28.000	7.690
2014	11.000	15.000		GBX	26.000	-10.340
2013	11.000		18.000	GBX	29.000

Number of Shares:

Payment	Paid	Amount
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