Cahoot, the stand-alone online banking subsidiary of troubled UK bank Abbey National, has reported £17 million losses and a fall-off in deposit balances for the first six months ended June 2002.
The bank says the outflow of funds is in line with expectations as it cut market-beating rates of interest on account balances. Cahoot describes the decline as "modest", but has yet to issue specific figures.
With 374,000 accounts opened, the bank says it remains well ahead of target and that deposits are earning a positive margin. The results statement highlights rapid growth in unsecured lending driven by sales of the flexible loan product of £296 million; and further growth in the credit card asset to £118 million (2001: £79 million).
At £17 million, losses for the first half have almost halved over the same period a year ago (2001: £36 million), due to the fall away of set-up costs.
The statement concludes: "Cahoot continues to demonstrate encouraging customer retention and cross-selling, boosted by new products including flexible personal loans, savings and travel insurance."