Private & Commercial Finance Group aiming to raise £10m to meet regulatory requirement

Specialist bank Private & Commercial Finance Group (PCF) is aiming to raise £10m in order to maintain the level of capital required by regulators.

The proceeds will allow the bank to maintain the level of regulatory capital and liquidity it is required to hold as agreed with the Prudential Regulation Authority (PRA) and the Financial Conduct Authority (FCA) when it received authorisation last December.

Once it has raised the funds needed, it will buy high quality liquid assets to maintain predetermined liquidity ratios for retail deposit taking and operate comfortably within the relevant regulatory capital regime, as well as provide capital for growth in the medium term.

About 10m will be raised from a placing of shares of 5p each to be sold at around 25p each on Friday through an accelerated bookbuild.

The company's majority shareholder, Bermuda Commercial Bank, or its parent company Somers, are intending to subscribe for shares, along with some directors of PCF.

The new shares are expected to be admitted to trade on AIM around 6 April.

Chief executive Scott Maybury said: "This capital will allow us to fund new business initiatives and portfolio growth over the medium term and operate within the predetermined capital and liquidity models agreed with the PRA and FCA."

He said that there is a potential increase in scale offered by the retail deposit-taking licence, with its targets set at a portfolio size of £350m after three years and £750m after five years, which is a significant increase on current levels of around £120m.

Shares in Private & Commercial Finance Group were down 0.45% to 26.38p at 0842 GMT.