Shore Capital flies flag for boutique brokers

INVESTMENT bank Shore Capital yesterday posted a double-digit rise in profit as the boutique broker and asset manager claimed that it had won business away from bigger players.

Graham Shore, managing director of Shore Capital, said fund managers were choosing to use smaller investment houses after seeing big names struggle during the financial crisis.

His comments came as the firm – which is based in London and provides corporate finance, stock broking and fund management services – posted a 12.7 per cent rise in revenue to 14.8 million, with pre-tax profit up 13.4 per cent to 2.3m.

The interim dividend was maintained at 0.25p and the company said it was on the lookout for acquisitions, with a cash balance of 47.6m and 35m in unused credit facilities.

Shore told The Scotsman: "We're chuffed with these results in the context the markets are tough.

"I think there's a change in the attitudes of fund managers – they used to give a significant proportion of business to the bigger houses because they thought they were a better counter-party risk.

"I think the institutions no longer think they are a superior counter-party risk, having had the experience of last September and October. Although, the overall volume of business available has reduced, more of it's going to the medium-sized brokers." Shore believes financial services staff disillusioned with life in London following the banking crisis may opt to work in Edinburgh instead.

He said that professionals working in the City but with family in the Scottish capital may choose to relocate.

After opening the firm's Edinburgh office last year, Shore said he was still on the look out for the "right candidates" to join the Scottish operation, which houses a team of research analysts.