x
By using this website, you agree to our use of cookies to enhance your experience.

TODAY'S OTHER NEWS

Professional landlord focus drives mortgage lending growth at Paragon

Specialist banking group, Paragon, has reported a 16% increase in first-half mortgage lending to £834 million – up from £721 million in the same period last year.

Buy-to-let business dominated new mortgage lending, up by 17% to £788 million. Paragon says this has benefitted from the group’s focus on professional landlords with larger portfolios who are becoming increasingly important to the supply of private rented property in the UK.

The proportion of ‘complex’ buy-to-let completions – comprising customers operating through corporate structures or running large portfolios – increased from 72% to 88% of the total during the first half of the year, representing 92% of the pipeline of future business at the end of March this year.

What’s more, underlying profits in the mortgage segment grew by 17% to £85 million and the net interest margin – which measures the difference between Paragon’s funding costs and what it earns from lending – improved from 1.55% in the first half of the year to 1.69%.

Paragon’s mortgage book increased by 7% to £10.8 billion by the end of the period.

Alongside mortgage lending, Paragon saw an 89% year-on-year increase in its commercial lending portfolio to £1.3 billion. The increase in lending was funded through an increase in the group’s savings deposits which grew 37% to £5.9 billion.

John Heron, managing director of mortgages at Paragon, said: “Complexity around the private rented sector resulting from fiscal changes and increased regulation has resulted in a shift in balance with professional landlords providing a greater proportion of the supply of rented homes.”

“Paragon’s experience of lending in this segment over the last 20 years has helped to consolidate a leading market position and grow market share where others have seen their positions eroded.”

He concluded: “Private landlords are vital to the UK’s housing provision and we continue to develop our product and service capability to support them in developing their business.”

icon

Please login to comment

Zero Deposit Zero Deposit Zero Deposit
sign up