24th May 2018 10:50
LONDON (Alliance News) - Paragon Banking Group PLC said Thursday its half-year profit increased 11% as the group continued its restructuring from a buy-to-let lender to a more diversified bank.
For the six months to March end, the bank reported pretax profit of GBP77.2 million up from GBP70.1 million the same period last year.
Chief Executive Officer Nigel Terrington said: "The success of our changing business model has enabled the group to support an increasing number of customers, whether they be landlords, small businesses or consumers.
"We are helping to support individual investment and retirement plans, create jobs in the real economy and even build homes across the country."
New lending business increased 29% to GBP990.3 million from GBP768.4 million.
Buy-to-let lending, the group's largest business, increased 21% to GBP670.5 million from GBP556.2 million with total mortgages reaching GBP721 million.
"The UK private rented sector continues to see strong levels of demand from tenants which is expected to continue for the foreseeable future," the company said.
"The buy-to-let market has experienced a long period of disruption following a series of fiscal and regulatory changes aimed at both landlords and lenders. However, no new changes have been introduced in the period and some stability is slowly returning to the market, albeit with new house purchase funding activity lower than that seen in previous years."
Commercial lending increased 49% to GBP269.3 million from GBP180.7 million year-on-year.
The company lifted its interim dividend 17% to 5.5 pence from 4.7p year-on-year. It said its capital levels remain strong, with a core equity tier 1 ratio of 15.5%, down slightly from a CET1 ratio of 15.9% a year before.
Shares were trading down 7.6% at 510.50p.
Related Shares:
Paragon Group