Arbuthnot Latham is to sell structured products business Gilliat Financial Solutions.
In a statement accompanying its half year report the private bank said: ‘Following a return to profitability of Gilliat Financial Solutions, we have been approached by a third party competitor and have agreed the sale of certain intellectual assets of the business, which will result in the cessation of the business in the third quarter of 2014.
It added: 'The outcome of this is not expected to have a material impact on the full year financial results of the group.’
In its update covering the six months to the end of June Arbuthnot Banking Group’s wealth management business, Arbuthnot Latham, saw first half profit rise from £1 million in the corresponding period of 2013 to £1.7 million. Discretionary funds under management jumped from 32% to £565.9 million over period.
The firm attributed this rise to new hires and diversification trends in the private client market.
Arbuthnot chairman Henry Angest told the market: ‘The investment in senior and experienced bankers and wealth managers continued to have a positive impact in the development of a broader based business.
‘There has also been a benefit from fluidity in the market that has seen many private banking clients seeking to diversify their existing relationships and move their business to Arbuthnot Latham.’
Elsewhere customer deposits grew by 30% to £588.9 million and loans by 28% to £393.8 million.
‘The bank continued to see good quality lending transactions and supported its client base in the fulfilment of several high quality projects,’ Angest said.
‘Where appropriate, the opportunity to support clients in their entrepreneurial ambition and value creation is as much a feature of the Arbuthnot Latham philosophy as is the management of their wealth.’
The good performance of the wealth arm contributed to a rise in profit across the wider group – which includes the retail banking firm Secure Trust Bank - from £2 million to £9 million.
The interim dividend was maintained at 11p.