26th Jul 2018 09:28
LONDON (Alliance News) - Virgin Money Holdings (UK) PLC on Thursday hiked its dividend payout by 21% and said its customer-focused growth strategy and quality returns led to a strong financial performance for the first half.
The UK challenger bank also said that it expects to deliver continued strong performance for the full year including a common equity tier 1 capital ratio of around 15.5%, before the benefits of a proposed joint venture with Aberdeen Standard Investments.
Virgin Money has retained its guidance for 2018, but anticipates banking net interest margin for year to be around 162 basis points due to continued pressure on mortgage spreads and card income adjustment. Banking net interest margin for the first six months to June-end stood at 164 basis points and for full-year 2017 was 172 basis points.
First half pretax profit totaled GBP127.2 million, up slightly from GBP123.8 million in the year ago period, on a net interest income of GBP303.1 million and GBP288.5 million, respectively.
Adjusted pretax profit - the company's preferred profit measure - grew 10% to GBP141.6 million from GBP128.6 million.
The FTSE250 listed company has declared a interim dividend of 2.3 pence per share versus 1.9p paid a year ago. Common equity tier 1 ratio stood at 16.3% for the first half.
"Our SME savings franchise gathered real momentum and is on track to deliver GBP500 million of new deposits by the end of 2018. Our partnership with Virgin Atlantic has got off to a flying start and the development of our digital banking platform is progressing well," said Chief Executive Jayne-Anne Gadhia.
"The recommended offer made by CYBG for Virgin Money in June reflects confidence in our strategy, our track record of delivery and the complementary models of the two businesses and will accelerate the delivery of our strategic objectives," Gadhia added.
Shares in the company were trading 0.4% lower at 386.40 pence each on Thursday morning.
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