Close Brothers Share Price: Buy or Sell Analysis 2025

If you’ve been watching Close Brothers Group (CBG) shares slide through 2024 and into 2025, you’re not alone — the merchant bank’s stock has been hammered by a perfect storm of regulatory action and a short-seller attack. At the heart of the story is a £320 million provision for car finance compensation that forced the company to cancel its dividend for the first time in years.

Current share price: 420.80 GBX ·
52-week high: 563.50 GBX ·
52-week low: 318.40 GBX ·
Previous close: 425.00 GBX ·
Performance (previous close): 3.44% ·
Car finance compensation: £320m

Five key data points, one clear pattern: the stock’s fundamentals have shifted from growth to capital preservation.

The table below shows the stock’s recent trading range.

Is Close Brothers a buy or sell?

• Analyst consensus remains mixed — some rate the stock a buy at current levels, while others advise hold due to regulatory uncertainty.
• Price targets range from 400 to 550 GBX, according to broker notes (Yahoo Finance analyst ratings).
• Forward P/E ratio reflects earnings uncertainty tied to the FCA review.

Analyst consensus on CBG

The sell-side is split. One camp sees opportunity: at 420.80 GBX, the stock trades well below its 52-week high of 563.50 GBX, suggesting room for recovery if the FCA review resolves favorably. The other camp points to the dividend cancellation — a clear signal that management sees significant risk ahead.

Key metrics for valuation

Current price sits at 420.80 GBX, with a 52-week range of 318.40 to 563.50 GBX. The market cap hovers around £1.4 billion. Without a reliable dividend yield — the 2024 payout was cancelled — traditional valuation models struggle. The company’s CET1 capital ratio is the metric that matters most now.

Risks and opportunities

The biggest risk: the FCA motor finance review could force additional provisions beyond the current £165 million set aside for consumer reimbursements (The Guardian report). The opportunity: if the FCA process concludes with a manageable outcome, Close Brothers may resume its dividend in 2025. The company said in its annual report that reinstatement would be reviewed once the FCA concluded (Close Brothers Annual Report 2024).

Why have Close Brothers shares dropped?

• Viceroy Research published a negative short report on Close Brothers in July 2023.
• The FCA motor finance review triggered a dividend cancellation in February 2024 (Bloomberg report).
• Shares fell 30% on the day of the dividend cancellation announcement (The Telegraph).
• The stock hit a 52-week low of 318.40 GBX in March 2024.

Viceroy Research report impact

In July 2023, Viceroy Research published a negative report on Close Brothers, questioning aspects of its lending practices. The report added downward pressure to a stock already facing headwinds from rising interest rates and the broader UK banking environment. While Viceroy is a short-seller with its own agenda, the report amplified existing concerns among institutional investors.

Car finance compensation announcement

The bigger hammer fell in February 2024. Close Brothers announced it would set aside a £320 million provision for car finance compensation related to historical commission arrangements. The company said it had set aside £165 million for consumer reimbursements, complaint management, and legal expenses (The Guardian). The market reacted harshly: shares dropped as much as 30% on the day, and by March 2024 the stock hit its 52-week low.

Market sentiment

The dividend cancellation sent a clear message to the market: management is in capital preservation mode. Retaining approximately £100 million of CET1 capital through dividend suspension (Close Brothers HY25 RNS) signals that the board believes the FCA review could have material financial consequences. The result: institutional investors who held CBG for income rotated out, pushing the share price lower.

Are Close Brothers paying dividends?

• No — Close Brothers cancelled its 2024 dividend entirely.
• The last dividend paid was 67.5p per share for the previous financial year (Close Brothers FY24 results presentation).
• The interim dividend for 2024 was nil (vs 22.5p in April 2023), and the final dividend for 2024 was nil (vs 45.0p in November 2023) (Close Brothers FY24 Results).

Dividend history

Close Brothers had a long track record of paying dividends, making the suspension in February 2024 a sharp break with tradition. The company paid 67.5p per share in the prior fiscal year, combining an interim payout of 22.5p and a final of 45.0p. The board’s decision to cancel both the interim and final dividends for 2024 was described as “difficult” in the company’s communication (Close Brothers HY25 RNS).

Current dividend yield

With no dividend paid for the 2024 financial year, the current dividend yield is effectively zero. For income-focused investors, Close Brothers currently offers no yield — a dramatic shift from its historical yield of approximately 5-6%.

Dividend payout ratio

Before the suspension, Close Brothers typically paid out around 50-60% of earnings as dividends. The cancellation of the 2024 dividend freed up approximately £100 million of CET1 capital (Close Brothers Half Year Results 2024). The payout ratio is currently zero, and will remain so until the board decides to resume distributions.

The implication: anyone buying CBG for income has the wrong thesis. This is a capital appreciation play — or a recovery play — not a dividend stock. The trade-off is clear: forgo current yield in exchange for potential upside if the regulatory cloud lifts.

Are Close Brothers in financial trouble?

• Close Brothers maintains a capital adequacy ratio above regulatory minimums.
• The loan book remains performing, but provisions for motor finance compensation have increased.
• Credit rating agencies have placed the bank on watch (Close Brothers Annual Report 2024).

Balance sheet strength

Close Brothers’ CET1 capital ratio remains above regulatory requirements, helped by the £100 million retained through dividend cancellation. The bank’s balance sheet is not impaired in the traditional sense — it has not suffered loan losses. The risk is entirely regulatory: the FCA review could force additional compensation payments that exceed current provisions.

Profitability trends

Profitability has been squeezed by two forces: rising provisions for motor finance compensation and higher operating costs associated with the FCA review. In March 2025, Close Brothers said expenses related to the motor finance issue were expected to reach £200 million in that year (The Guardian). This eats into earnings and makes near-term profitability uncertain.

Regulatory risks

The FCA motor finance review is the single biggest risk factor. Close Brothers said in its annual report that the board concluded it was not required to recognize a provision at that stage (WealthBriefing report), but the uncertainty itself has been enough to crater the stock and force dividend suspension. The FCA’s final ruling, expected in 2025, will determine whether Close Brothers faces manageable costs or a more severe capital drain.

The catch: Close Brothers is not in financial trouble in the sense of insolvency or loan defaults. It faces a concentrated regulatory risk that could be large, but is finite. The company has decent capital buffers and a performing loan book. The question is not whether it will survive, but at what cost to shareholders.

When to expect dividend payout?

• No dividend for the 2024 financial year.
• Reinstatement will be reviewed once the FCA concludes its process (Close Brothers Annual Report 2024).
• If the FCA outcome is favorable, a dividend could resume in the 2025 financial year.

2024 dividend schedule

Close Brothers historically paid an interim dividend in April and a final dividend in November. In 2024, both were cancelled. The interim dividend that would have been paid in April 2024 was nil (vs 22.5p in April 2023), and the final dividend that would have been paid in November 2024 was nil (vs 45.0p in November 2023) (Close Brothers FY24 Results).

Payment method

Historically, Close Brothers offered a scrip dividend option allowing shareholders to receive shares instead of cash. That option is currently moot, as no dividend is being paid. If dividends resume, the scrip option may return as a capital-preservation mechanism for the company.

Future dividend outlook

The company has stated clearly: reinstatement of dividends “in 2025 and beyond would be reviewed once the FCA concluded its process and the financial consequences were assessed” (Close Brothers Annual Report 2024). This means the earliest possible resumption is the 2025 interim dividend, payable in April 2025 — but only if the FCA review concludes early enough and the financial impact is manageable.

The trade-off: dividend reinvestment is not an option now, but the capital retained strengthens the bank’s position. If the FCA outcome is benign, Close Brothers could resume a dividend of 40-50p per share within 12-18 months. If the outcome is severe, the suspension could extend into 2026.

Timeline: Key events affecting Close Brothers share price

Clarity: What we know vs what remains uncertain

Expert quotes

“Close Brothers said cancelling the dividend would help strengthen its capital position and support customers and the business franchise.”

— Close Brothers Group, as reported in its 2024 Annual Report (Close Brothers Annual Report 2024)

“The negative report from Viceroy Research added downward pressure to a stock already facing headwinds from the FCA motor finance review and rising interest rates.”

— Market analysis, as reported by The Telegraph (The Telegraph)

Summary: What this means for investors

Close Brothers’ share price has been battered by a regulatory crisis that forced the first dividend cancellation in the company’s modern history. The stock now trades at a discount to its 52-week high, but the discount comes with a reason: the FCA motor finance review could still deliver a costly blow. For income-focused investors in the UK, the choice is clear: wait for the FCA outcome before buying, or risk holding a stock that may not pay dividends again until 2026. For value-oriented investors, the current price of 420.80 GBX offers potential upside — but only if the final compensation bill stays within the current £320m provision, and the dividend returns in 2025.

For a deeper look at the factors driving the stock, see this Close Brothers share price analysis from a UK financial site.

Frequently asked questions