Hargreaves Lansdown says has capital resources 'for forseeable future'

Financial services firm Hargreaves Lansdown said full year net new business inflows rose 15% to £6.9bn adding that it had “sufficiently strong financial, liquidity and capital positions” and operate a progressive ordinary dividend policy.

“The board remains committed to paying special dividends in future years when sufficient excess cash and capital exist after taking account of the group's growth, investment and prospective regulatory capital requirements at the time,” the company said.

Hargreaves earlier this month said it needed to keep an extra £50m of capital after the Financial Conduct Authority announced plans to “reassess” the broker’s capital requirements. The company on Tuesday said it had not received any formal guidance from the FCA before publication of its results so it was using estimates.

“The group maintains on-going forecasts that indicate continued profitability in the 2017 financial year. Stress test scenarios are undertaken, the outcomes of which show that the group has adequate capital resources for the foreseeable future even in adverse economic conditions.”

HL said it would have “adequate resources to continue in operational existence for a period of at least 12 months from the date of approval of the group financial statements”.

Pre-tax profits rose 21% to £265m, with total assets under administration up 28% to £79.2bn. The ordinary dividend was up 20% to 29p a share, but the annual total payout fell 15% to 29p a share after the special divi was axed.

Hargreaves shares were down 1.67% to 1334p at 10:02 BST.