OSB Group PLC (LSE:OSB) wrote nearly 17% less from mortgages for its landlord and buy-to-let customers in the first quarter of this year, with bad debts also rising.
New advances dropped to £1 billion in the three months to the end of March 2024 against £1.2 billion a year ago, the specialist bank said in a trading update.
OSB's loan book overall rose 1% to £26 billion in the past quarter on an underlying basis, while impairments rose to 1.5% from 1.4% and blamed on the impact of higher cost of living and borrowing
Andy Golding, chief executive, said demand in its core Buy-to-Let and residential sub-segments “remains positive” with "high-quality applications and completions supporting the growing net loan book.
“Retail funds pricing remained stable through the quarter as we grew the savings book in line with our requirements.”
A host of big-name lenders have been raising mortgage rates recently even though expectations are for the Bank of England to start cutting base rates in the autumn.
Golding added market conditions remain “dynamic” but OSB expects underlying net interest margin and costs to be broadly flat to 2023, with underlying net loan book growth of around 5%.