23rd Nov 2016 08:08
LONDON (Alliance News) - Specialist lender The Paragon Group of Companies PLC said Wednesday that its banking operations are becoming its core engine of growth, as it reported increased profit and hiked its dividend for its most recent financial year.
FTSE 250-listed Paragon booked a pretax profit of GBP143.2 million for its financial year ended September 30, up 6.7% from GBP134.2 million in the prior year. The company said its underlying profit for the year was GBP146.9 million, up 9.1% from GBP134.7 million the year prior.
The total new value of Paragon's new business in the year was GBP1.65 billion, up from GBP1.49 billion the prior year. Of that, 71% was buy-to-let property lending, reduced from 89% in the prior year, as the value of Paragon's new buy-to-let lending decreased to GBP1.16 billion from GBP1.33 billion year-on-year.
The lender is proposing a final dividend of 9.20 pence per share, leading to a total dividend for the financial year of 13.50p per share. This will be a 23% increase from 2015.
Paragon also said that it will extend its share buy-back programme by an additional GBP50.0 million in its current financial year.
"Paragon's operating model is undergoing significant change, as it transitions from a non-bank, securitised, monoline lender into a retail funded banking group. Paragon Bank is increasingly at the heart of the group's development, with its deposit book now exceeding GBP2 billion and its franchise firmly established," said Nigel Terrington, chief executive of Paragon.
"We have put in place the foundations for strong and sustainable growth. The business is well funded and well capitalised with a robust operating model and an exemplary track record. We continue to believe that over the medium term the banking markets will undergo structural change which will favour specialist lending institutions such as Paragon and we are well positioned to take advantage of the opportunities that will arise," added Terrington.
Shares in Paragon were up 2.4% at 370.80 early Wednesday morning.
By Adam Clark; [email protected]
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