TSB FY profits jump ahead of Santander takeover

(Sharecast News) - High street lender TSB posted a jump in full-year profits on Friday ahead of its takeover by Santander, driven by higher income and lower costs.

Statutory pre-tax profit for 2025 was £350.4m, up 20.7% on the previous year. Income rose 3.6% to £1.18bn, reflecting higher structural hedge income from a stable base of deposit balances.

Meanwhile, operating expenses fell 4.4% to £786m, reflecting continued cost control and the implementation of strategic initiatives to further simplify the business.

The net interest margin - a key measure of profitability - ticked up 21 basis to 2.89% in 2025.

TSB said total customer lending was broadly flat at £36.3bn. Despite a challenging lending market, mortgage balances remained stable, it said.

The lender's cost-to-income ratio fell 5.5 percentage points to 66.4%, "reflecting continued cost management discipline and income improvements while remaining focused on delivering for customers".

Chief executive Marc Armengol said: "2025 was an extraordinary year for TSB. Our record financial performance was underpinned by the committed, collective effort of my colleagues: stepping up to ensure we stay truly competitive, deliver money confidence for our customers, act responsibly and run the bank more efficiently."