Wednesday, February 21, 2024
Finance

Paragon Bank reports strong trading

Mortgages

The mortgages loan book at the end of Paragon’s full year period sat at £12.9 billion, compared to £12.3 billion at the same point last year

Paragon Bank grew its mortgages loan book by 4.7 per cent in the year to end of September 2023 on the back of strong trading and retention performance, the firm has reported.

The mortgages loan book at the end of Paragon’s full year period sat at £12.9 billion, compared to £12.3 billion at the same point last year.

Overall, Paragon Banking Group reported a record underlying operating profit of £277.6 million for the period, up 25.4 per cent on last year.

The mortgages loan book benefitted from good customer retention and strong levels of new lending.

New BTL lending outperformed the market in spite of challenging economic conditions. Total mortgage originations were broadly flat at £1.88 billion, partly because of Paragon’s pipeline hedging policy protecting customers in the pipeline from rate volatility at the time of the mini-budget.

Paragon increased its focus on specialist BTL during the period, with 98.8 per cent of completions classed as specialist, whilst the bank also recorded an increase in lending on property with an Energy Performance Certificate rating of A-C.

Completions on A-C-rated property sat at £904.6 million for the period, 8.7 per cent higher on last year.

Paragon’s Mortgages arrears performance remained robust, with arrears on the BTL book finishing the period at 0.34 per cent compared to 0.69 per cent across the wider BTL market.

The division also benefits from low LTV coverage across the book at 62.8 per cent, with Paragon’s landlord customers benefiting from £9 billion of equity in their mortgaged portfolios.

Commenting on the latest figures Paragon Bank MD of mortgages, Richard Rowntree said: We delivered strong results despite the challenging market conditions. New lending was broadly in accordance with the previous year, which reflects our hedging policy designed to safeguard customers as well as our focus on portfolio landlords who remained active in the market.

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