Close Brothers’ slowing pace of loan growth is hardly a new phenomenon (Fig 1, page 2). As illustrated, it enjoyed growth of 18-23% p.a. through FY10-FY12 when competition was slight. It is now relatively intense and so, maintaining its discipline in terms of risk appetite and pricing, has translated into lacklustre loan growth of only 0.4% for the five months to December 2019. The Banking Division has seen sustained margin pressures for a decade (Fig 2, page 2), primarily driven by weaker Other Income (which Close includes within its definition of NIM). We see little prospect of any near-term relief. Close has now formally guided to another year of negative jaws in FY20 (Fig 3, page 3), primarily driven by investment spend within the Banking division. We see Banking division PBT flat/down through FY20-FY22e (Fig 4, page 3). Close Brothers runs with a ”structurally high” group cost:income ratio (60.9% in FY19) which we expect to rise to 61.7% in FY20e (Fig 5, page 4). We expect comparatively little relief in the Securities division (78.6% in FY19) or Asset Management (81.8%) and so, in aggregate, we see group underlying profit before tax as flat/down through FY20-22e (Fig 6, page 4). After EPS of 134.2p in FY19, we forecast a 2.7% decline to 130.6p in FY20e, (1% below Bloomberg consensus of 131.3p). Thereafter, we model a recovery to 134.8p by FY22e (2% below Bloomberg consensus of 137.6p). However, with incremental capital generation and adequate cover, we still forecast DPS growth to 69.0p/72.0p/75.0p through FY20/21/22e (Fig 7, page 5). Close trades on a “premium” 1.9x FY19 tNAV. ROTE has been in decline since FY15 (Fig 8, page 5) and reflecting (1) ongoing NM erosion, (2) negative jaws, (3) upward normalisation of impairments and (4) a slight equity build, we forecast 15.9%/15.0%/14.3% through FY20/21/22e.