23rd Jul 2019 08:35
(Alliance News) - Paragon Banking Group PLC on Tuesday said new business growth has been "strong" and its margin has improved in line with expectations in the nine months to June 30.
The lender, whose financial year ends September 30, said it has experienced "strong new lending", sitting at GBP1.90 billion year-to-date versus GBP1.58 billion for the same period of 2019. This represents an improvement of 20%.
Of this GBP1.90 billion figure, Mortgages constituted GBP1.19 billion while Commercial Lending made up GBP710 million. This compares to GBP1.13 billion of Mortgages and GBP450 million of Commercial Lending the year before.
Deposit balances totalled GBP6.1 billion at Paragon's five-year anniversary. Its annualised buy-to-let redemptions stood at 8.6%, down from 10.7% year-on-year.
Paragon said its net interest margin "continues to improve" and it now expects its annual net interest margin will exceed the 2.2% level recorded in the first half of its financial year.
Annual lending volume guidance is unchanged, with Mortgage volumes predicted to be around GBP1.6 billion and Commercial Lending volumes to be more than GBP900 million.
The company sold a residual interest in a legacy securitisation in June for a one-off GBP9 million gain, removing around GBP900 million of assets from its balance sheet. As a result, current year operating profit is to fall be around GBP2 million, increasing to GBP6 million in 2020.
Shares in Paragon were up 0.9% at 449.20 pence on Tuesday morning.
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Paragon Group