Paragon Banking Group PLC (LSE:PAG) shrugged off concerns over the buy-to-let market as it accompanied a 27% hike in annual profits with a bullish update for the current year.
Buy-to-let has reportedly been in turmoil due to rising mortgage rates and changes to the taxation of second homes in the Budget, but Nigel Terrington, the specialist mortgage lender’s chief executive said its trading had remained strong.
“We have seen accelerating momentum throughout the year, with new lending levels reaching the upper range of our expectations and strong customer retention.
“Improving customer sentiment, robust year-end pipelines, and our strategic focus on specialist markets, gives us confidence as we enter the new financial year.”
Operating profits for the year to end September 2024 rose by 5.4% to £293 million and pre-tax profits by 27% to £254 million.
Impairments rose to £24.5 million from £18.0 million in 2023, reflecting a cost of risk of 16 basis points (2023: 12 basis points).
The full-year dividend rises by 8% to 40.4p.
Shares rose by 3.3% to 772p.