One Savings Bank reiterated it expects the buy-to-let market to hold up over the rest of the year even after a first-half profits slump and soaring mortgage rates.
Profits tumbled by 71% as bad debts rose and it took a big hit for customers remortgaging faster than expected.
The buy-to-let property lender had already warned this change in behaviour, which affected assumptions related to its effective interest rate (EIR) and loan book, would cost it £180 million.
In addition, impairments rose to £44.6 million or 0.37% of the loan book against £1.6mln and 0.1% a year ago and this, combined with the EIR change, saw profits drop to £116 million from £294 million.
The loan book rose 4% to £24.6bn over the half as OSB said landlords locking in lower monthly repayments in expectation of further base rate rises led to a rise in refinancing activity.
Shares rose 1% to 390p, having crashed in July when it first warned about the EIR issue.