Paragon Banking reports 'robust' nine month new business flows

(Sharecast News) - Paragon Banking Group described its performance for the first nine months of its financial year as "strong", on the back of "robust" new business flows, and reiterated its guidance. For the year-to-date, the lender reported a 4.8% increase in net loans to reach £14.7bn with mortgage lending up by 7.8% to £1.4bn, even as commercial lending slipped by 8.7% to £0.9bn.

Interest rate and swap volatility did lead to market disruption and reduced application flow during the third quarter, "slowing the rate of pipeline increases".

Retention levels on the other hand had continued to improve, as expected.

And mortage loanto-value ratios remained "low" at 62.1%.

Retail savings balances grew during the quarter to £12.3bn, for a 21.6% jump year-on-year.

The unverified common equity Tier 1 capital was at 15.6%.

Management also reiterated its full-year guidance, saying that it anticipated volumes, margins and costs all in line with its expectations.

The lender also stood by its previous guidance for full-year net interest margins of approximately 300 basis points.

As of 0821 BST, shares of Paragon Banking were trading down by 2.99% to 535.0p.