https://uk.finance.yahoo.com/news/clydesdale-boss-david-duffy-hits-000119490.html
Clydesdale boss David Duffy hits back at 'lazy' critics as bank prepares to float
By Tim Wallace | Telegraph – Sat, Dec 26, 2015 00:01 GMT
The bank plans to go it alone in February, and chief exec David Duffy says its critics have failed to realise just how fast it is growing
Promises of rapid growth at the Clydesdale and Yorkshire Bank in the coming years are realistic and not over-ambitious, the bank’s chief says, hitting back at critics who claim the lender has few distinguishing characteristics and may struggle to grow.
Chief executive David Duffy wants the bank to grow its mortgage and retail lending by 50pc and small business lending by 25pc in the coming five years.
Analysts told the Telegraph that Clydesdale could struggle to compete effectively with the big banks, as it will have to tempt customers away from the giants with lower prices, while having a relatively high cost base compared to its rivals.
But chief executive David Duffy argues that those critics have failed to appreciate its substantial growth in recent years.
“I think it is lazy commentary by people look at our actual performance. The growth rates for the future are based on execution of the past three years,” said Mr Duffy.
“If you look at mortgages, we’ve grown at 10pc for the last four years. Last year we did £2bn of new mortgages, £1.9bn of new SME facilities , and £2.2bn of deposits. Each aspect of the business performed strongly.
“So when we look at the growth and the returns on equity we’re planning, it is an extrapolation of existing performance rather than some aspiration.”
Clydesdale's growth plans come as it prepares to be sold off by its parent, National Australia Bank .
The bank wants to expand outside its core regions of Scotland and the north of England, and also wants to gain more younger customers.
Currently only 23pc of its customers are classified as young and affluent, compared with 31pc of bank customers across the wider market.
Those younger customers have an average of £12,100 in debt compared with just £1,600 for older customers, meaning they are more profitable for the bank and so are a more attractive group to target.
Clydesdale is confident it can cope with a rapid expansion in customers as it already has IT (Other OTC:
ITGL -
news) capacity in place to handle twice as many transactions as now.
Mr Duffy hopes he will be better at poaching younger customers than the other challenger banks, naming TSB, Williams and Glyn and the Co-op Bank as competitors of similar scale.
“All of those don’t have the full-scale SME and retail franchise that we do, and they don’t have aspirations for it, so we’re situated extremely well,” he said.
“Most of them are carving out or cloning their operating systems we are not having to. That is a very powerful difference.”
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