Davy’s UK business returns to profit despite Russia sanctions blow

Accounts for J&E Davy (UK) reveal outstanding €88m debt to Bank of Ireland, which has acquired overall group

The UK unit of professional services firm Davy saw its portfolio shrink by about 3 per cent last year as a result of the Russian invasion of Ukraine and subsequent sanctions on Russian individuals and entities, its latest accounts show.

J&E Davy (UK), which has filed accounts for the year ended December 31st, 2021, swung to a profit of £320,260 (€380,083) during the period following a loss of £353,166 the year before. It also grew revenues from £11.5 million to £14.1 million.

In a note attached to the accounts marked “subsequent events”, the directors pointed out that “a range of financial and economic restrictions and sanctions” have been placed on Russian nationals, Russian assets, and the Russian Central Bank since the war broke out.

They said the company had carried “detailed reviews” of its operations, clients, and counterparties to ascertain its exposure to the crisis, and that “appropriate measures” are being taken with regard to further investigation of client accounts.


The company’s review concluded that the Russian invasion of Ukraine and the Western response has had “a very limited direct impact” on J&E Davy (UK).

The directors said: “The main impact is expected to be the general market reaction impacting funds under management.”

They added that the company’s portfolios have decreased about 3 per cent in the year to date and that this is being “actively monitored with management action implemented as required”.

Separately, J&E Davy (UK) became a UK-regulated subsidiary of Davy in 2018 as the group prepared for Brexit and, as part of that restructuring, became a guarantor for borrowings of a group holding company, called Green Note Unlimited.

Notes in the accounts highlight that Green Note owed Bank of Ireland €88 million at the end of 2021, down from €94 million a year earlier. The loan, dating from April 2018, was an amendment of a facility agreed in 2013 and carries an interest rate of 2.25 per cent.

It falls immediately due and repayable upon change of control of the group, according to the note.

Bank of Ireland agreed in 2020 to buy Davy for an enterprise value of €440 million, four months after the firm put itself on the market in an effort to draw a line under a bond-trade scandal. The sale was completed last month and the accounts were signed off on April 6th.

The loans are known to be a legacy of Bank of Ireland backing the repurchase by Davy in 2013 of €140 million loans from the liquidator of Irish Bank Resolution Corporation, formerly Anglo Irish Bank.

The accounts also show the group had total assets worth £16.1 million at the end of last year, which were up from £15.7 million the year before. Total shareholder funds increased to £12.7 million from £12.4 million.

The company employed an average of 79 people, up from 74, and spent £6.1 million on employee costs, which was up from £5.4 million. There was no dividend declared for the year.

Colin Gleeson

Colin Gleeson

Colin Gleeson is an Irish Times reporter