Lombard Group has increased its pre-tax profit for the six months ended June 30 to €7 million, an increase of 3.6 per cent. The pre-tax profit of Lombard Bank plc increased to €6.19 million, 1.7 per cent higher than the same period in 2010.

The group profit after tax of €4.53 million increased by 4.7 per cent compared to €4.33 million in the previous year, the bank said in a statement published on the Malta Stock Exchange.

Net interest income of €7.25 million decreased by 11.3 per cent from €8.17 million in 2010 as a result of decreased customer lending, “also reflecting the bank’s prudent credit policies”, Lombard said.

The operating income remained stable at €19.94 million “reflecting treasury management policies that keep in mind the instability prevailing in global economic and financial markets”.

Loans and advances to customers stood at €300.08 million, down by €33.65 million “consequent to subdued business sentiment in the bank’s traditional market segments and lower demand for credit in general combined with the Bank’s lending policy”, it said.

Customer deposits at €453 million were lower by €19.92 million reflecting fluctuations in corporate deposits and total assets under management stood at €550.26 million, down 3.1 per cent.

Lombard said it acknowledged that the unrest in the international financial markets could have an impact on the business climate of Malta but that it believes the bank’s strong financial fundamentals enabled it “to weather the storm”.

“Given that the world economic and financial climate remains challenging, the main objective of Lombard Bank will be that of protecting its strong financial basis rather than to seek short term gain in operational performance,” it said.