Internet bank Egg moves into the black

Internet bank Egg said today that its UK credit card business had done well as it unveiled a move into the black in the first half.

Egg said card balances grew by 5% in the six months to June 30 compared with the industry equivalent of 2%.

The uplift contributed to an overall group pre-tax profit of £15m (€21.7m) in the period against a loss of £1.7m (€2.5m) last time.

The UK arm delivered operating profits of £23m (€33.3m) against £35.8m (€51.8m) last time as the impact of a deliberate cut in personal loan sales volumes offset higher credit card income.

Egg said costs had fallen by £10m (€14.5m), or 8%, against the same period last year, with an improving cost to income ratio.

It said that was due in part to restructuring completed in the second quarter, which had aligned costs to the group’s new strategy of focusing on the UK consumer.

Chief executive Paul Gratton said the company was planning to launch new products designed to help customers manage their money more effectively.

“Overall, the result for the first half was in line with our expectations and we remain confident about the remainder of the year,” Mr Gratton said.