Hambros report into Co-op bid may not be made public

The truth about Hambros' role in Andrew Regan's failed bid for the Co- operative Wholesale Society (CWS) may never emerge after Sir Chips Keswick, chief executive, said yesterday an independent investigation by solicitors Norton Rose might not be made public.

He said the report was expected by the end of the month but might only be seen by the bank and its regulators.

He was speaking as Hambros, one of the City's last remaining independent investment banks, reported more than tripled pre-tax profits of pounds 64.7m (pounds 20.6m) for the year to March, mainly thanks to a pounds 35m turnaround at the group's 52 per cent-owned Hambro Countrywide chain of estate agents.

An undisclosed payment to the CWS, thought to be around pounds 1m, was included in a pounds 9.2m exceptional charge that also covered the costs of a strategic review of the group. The payment followed an unreserved apology from group chairman Lord Hambro for the bank's support of the discredited pounds 1.2bn bid and the part it played in distributing stolen documents around the City.

Sir Chips said Hambros would "take as soon as possible any action that needs to be taken to ensure we preserve and then enhance the good name which is so important to us. We believe that this will enable us to put the matter behind us."

Peter Large, the corporate financier who headed the Hambros team advising Mr Regan, has temporarily stepped down from his position and is helping the Norton Rose inquiry.

Turning to the results, Sir Chips admitted that profits from the core banking business remained "inadequate" and said he remained committed to seeing a return to "satisfactory and sustainable" returns. Profits of pounds 10m from banking were sharply higher than the previous year's pounds 500,000 but they represented an underlying fall before lower bad debt provisions from pounds 36.7m to pounds 20.4m. The return on capital in the business was at least three times too low, Sir Chips said.

Hambro Countrywide returned a profit of pounds 31m compared to the previous year's pounds 4m loss as the number of transactions handled by the group rose by 28 per cent, much better than the 9 per cent volume increase in the market as a whole.

Investment profits slipped from the previous year's record profit of pounds 28.8m to pounds 25.2m while Insurance Services retreated marginally from pounds 11.1m to pounds 10.9m.

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