OSB Group PLC (LON:OSB) said new loans advanced in the quarter to end-April, 2021 had dropped to £1.1bn from £1.5bn a year ago even though the housing market is booming.
The specialist mortgage bank took a £20mln provision in its last results for suspected fraud and OSB said it has tighthead its loan criteria.
Overall, OSB added trading had been strong in the three months while the healthy housing market and rising prices had helped its bad debt provisions.
Three month-plus arrears remained stable in the first quarter and impairment provisions benefitted from house price appreciation, OSB said.
Andy Golding, chief executive, added: “The underlying net loan book grew [3%] to £19.6bn at the end of March 2021, supported by £1.1bn of organic originations, achieved at attractive margins and on tighter post-COVID criteria.
“We entered the second quarter with a robust pipeline of new business and applications in our core Buy-to-Let and Residential sub-segments remain strong. We continue to control volumes in our more cyclical product lines."