Earnings rose 1.6p to 22.7p and a 6.5p final dividend makes a total of 9.5p, an 8 per cent increase.
Peter Winkworth, one of the four-man team that heads the bank, said that in the short term the company would benefit from higher interest rates because it had pounds 66m of free capital that it has placed on deposit.
Close is determined to capitalise on the difficulties of some of its competitors. 'We are now intent on building up a major merchant banking group,' said Hugh Ashton, Close's chairman. The scheme could involve substantial acquisitions in the near future.
The growth in profits came mainly from two businesses - Close Consumer Finance, a used- car financing company based in Yorkshire, and Prompt, a business that allows companies to pay insurance policies by instalments.
Mr Winkworth said that the used-car market had held up well despite the well-publicised problems in selling new cars. Bad debts had been kept to a minimum by tight controls and Yorkshire had shown some resilience to the recession.
Prompt benefited from the desire of firms with large overdrafts to defer insurance payments. By not paying the premiums at the beginning of the year companies gain an extra form of off-balance- sheet finance.
Another area of success was BES schemes, where Close hired a team from Chancery Securities. It recently launched a joint scheme with Barclays Bank for investing in assured properties.
However, all was not rosy. The group's Air and General Finance arm suffered its first loss in seven years because it was forced to repossess some light aircraft.
Karen Neale, finance analyst at Barclays de Zoete Wedd, was impressed by the figures but pointed out that much of the growth had come from recently acquired companies. She predicts profits of pounds 13.4m for this year.Reuse content