17th Mar 2015 08:25
LONDON (Alliance News) - OneSavings Bank PLC Tuesday reported a jump in pretax profit in 2014 as it continued to grow its loan book, while the lender also said it will pay a maiden final dividend of 3.9 pence per share for the year.
The specialist lender, which funds residential, buy to let and commercial mortgages, secured loans and development finance, said it made a GBP63.7 million pretax profit in 2014, compared with GBP31.4 million in 2013, boosted by growth in new lending and improved margins.
Net interest income, effectively the difference between the interest received on loans to customers and the interest paid to savers, swelled 77% to GBP125.2 million, with OneSavings Bank citing loan book growth and an improved net interest margin. The improved margin was due to "the positive impact of high margin organic origination and portfolio purchases, and a continued reduction in the bank's cost of retail funds".
However, impairment losses rose to GBP11.7 million from GBP7.3 million
"We experienced strong growth in profitability across all of our business segments whilst maintaining tight control on costs and excellent levels of customer service," Andy Golding, chief executive, said in a statement.
"Looking forward we believe the macroeconomic backdrop remains supportive for the overall housing market and we expect to see a continuation of the positive trends we experienced in our target markets during 2014," Golding added.
Although Golding said the broader mortgage market has seen more intense competition, he said that OneSavings bank is confident about its own prospects.
"We remain confident in the outlook for our business and anticipate demand will remain strong as we continue to differentiate ourselves from the competition through the identification of high value, underserved markets," Golding said.
Formed in 2011 after the recapitalisation of the Kent Reliance Building Society by US private equity firm J.C. Flowers & Co LLC, OneSavings Bank listed on the London Stock Exchange in June 2014.
OneSavings Bank shares were up 7.3% at 227.00 pence early Tuesday. The company's initial public offering price was 170 pence.
By Samuel Agini; [email protected]; @samuelagini
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