Secure Trust Regulatory News (STB)

PRESS RELEASE

Secure Trust Bank PLC

LEI: 213800CXIBLC2TMIGI76

23 July 2021

For embargoed release at 07.00am

This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) No. 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018.

SECURE TRUST BANK PLC

Sale of Mortgage Portfolio

The Board of Secure Trust Bank PLC ('STB') announces that STB has agreed to sell a portfolio of Mortgage loans to Jacqali Designated Activity Company, a financing vehicle established by a global financial institution. This sale represents STB's full exit from the residential mortgage market, which STB withdrew from in 2019.

The consideration for the sale is estimated at £54.6 million, subject to reconciliation, payable in cash on completion. The cash purchase consideration for the portfolio was calculated based on an agreed price (including a premium to net book value) for the portfolio as at 31 December 2020, adjusted for cash receipts STB received from the portfolio during the period from then up to the date of completion. The obligation of the purchaser to pay the consideration is backed by the global financial institution.

The net book value of the portfolio as at 31 December 2020 was £77.7 million. The portfolio contributed £1.95 million including allocated costs to STB's profit before tax in FY2020, on an unaudited basis.

The sale is in line with STB's strategy to focus on specialist lending segments offering higher yields. The capital released is intended to be reinvested into STB's remaining businesses and for other general corporate purposes.

The sale and purchase agreement contains warranties and indemnities, as well as a purchase price reconciliation mechanism, which are each customary for a transaction of this nature.

David McCreadie, Chief Executive Officer, commented:

"The disposal is in line with STB's strategy of maximising value, simplifying the Group and focusing on the areas of the business that have the strongest prospects for delivering sustainable and profitable medium to long-term growth. The proceeds will be used to strengthen STB's capital position, provide additional financial flexibility to deliver its growth strategy, and ultimately enhance returns for shareholders."

The sale constitutes a class 2 transaction for STB for the purposes of the Financial Conduct Authority's Listing Rules (the "Listing Rules"), and this announcement is made in accordance with STB's disclosure obligations pursuant to Chapter 10 of the Listing Rules.

‐ENDS-

Enquiries:

Secure Trust Bank PLC

David McCreadie, Chief Executive Officer

Rachel Lawrence, Chief Financial Officer

Tel: 0121 693 9100

Stifel Nicolaus Europe Limited (Joint Broker)

Robin Mann

Gareth Hunt

Stewart Wallace

Tel: 020 7710 7600

Canaccord Genuity Limited (Joint Broker)

Emma Gabriel

Tel: 020 7523 8000

About STB:

STB is an established, well‐funded and capitalised UK retail bank with a 69 year trading track record. STB operates principally from its head office in Solihull, West Midlands, and had 1,003 employees (full‐time equivalent) as at 31 December 2020. The Group's diversified lending portfolio currently focuses on two sectors:

(i) Business Finance through its Real Estate Finance and Commercial Finance divisions,

(ii) Consumer Finance through its Motor Finance, Retail Finance and Debt Management divisions

 As at 31 December 2020 the Group's loans and advances to customers totalled £2,358.9 million, customer deposits totalled £1,992.5 million and the Group's total customer base was well over 1.5 million.

Secure Trust Bank PLC is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Secure Trust Bank, PLC, One Arleston Way, Solihull, B90 4LH.

 Further information:

This announcement (including any information referred to in this announcement) contains statements which are, or may be deemed to be, "forward-looking statements". Forward-looking statements are prospective in nature and are not based on historical facts, but rather on current

expectations and projections of STB about future events, and are therefore subject to risks and uncertainties which could cause actual results to differ materially from the future results expressed or implied by the forward-looking statements. STB cannot give assurance that such expectations will prove to be correct. You are cautioned not to place any reliance on these forward-looking statements. Other than in accordance with its legal or regulatory obligations, STB expressly disclaims any intention or obligation, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.