Banking group Close Brothers said it is still on the lookout for acquisitions as it reported a 19 per cent rise in half-year pretax profits yesterday.

The rise was driven by the investment bank division, the company said.

The mid-tier banking group, which has a private asset management operation in Birmingham, reported operating profit before tax in the six months to January of £76.5 million, up from £64.2 million in the first half of 2005.

"The investment bank is up almost a third in profit terms," said chief executive Colin Keogh.

"We were a bit cautious at the end of last year about prospects for the commercial banking business, but it's done better than we thought," he said.

Mr Keogh added that the firm was still looking for acquisitions to expand its asset management arm, although the business was growing strongly under its own steam.

"We've got a strong private client and a good funds business, so if there were to be acquisition opportunities it could be in either of those," he said.

Close Brothers have been involved in a number of high-profile deals in the West Midlands. In March 2004, it helped Enterprise Inns raise debt facilities of £780 million to finance the acquisition of the Unique Pub Company. The company was also involved in the £27 million management buyout of Liberty's nightclub in Edgbaston from Luminar.

Close Brothers revealed that Rod Kent, former chief executive of the bank, is to take over as non-executive chairman from David Scholey, who will retire in October.

The results showed the benefits of the current surge in mergers and acquisitions activity, with corporate finance profits up 83 per cent to £8.8 million.

Banking increased profits by seven per cent to £36.9 million.

"For our banking activity, the second half has started well, and we expect continued progress at a modest level," Mr Keogh said.