Net loan book rises to £7 billion as average monthly lending increases by 24%
Non-bank lender Together Financial Services has reported strong performance and growth in the quarter to March 31, 2024, with its loan book reaching £7 billion.
Average monthly lending was £262.5 million in the third quarter of 2023-24, a 24% increase from £211.7 million in the same quarter of the previous year and a 12.7% rise from £233 million in the previous quarter.
The group’s net loan book rose to £7 billion, a 14.3% increase from £6.2 billion in Q3 2023 and a 3.7% rise from £6.8 billion in Q2 2024.
Net interest income, profits, and cash receipts also showed strong growth. Interest receivable and similar income was £196.9 million, a 32.3% increase from £148.8 million in Q3 2023 and a 3.8% rise from £189.6 million in Q2 2024.
The underlying net interest margin was 5.5%, consistent with Q2 2024 and up from 5% in Q3 2023. The annualised cost of risk was 0.8%, compared to 0.5% in Q3 2023 and 0.7% in Q2 2024, with ongoing geopolitical uncertainty posing macroeconomic risks.
The group remained highly profitable and cash-generative, with underlying profit before tax of £51.8 million, a 25.4% increase from £41.3 million in Q3 2023 and an 8.6% rise from £47.7 million in Q2 2024. Cash receipts were £730.5 million, up from £515.7 million in Q3 2023 and £703.6 million in Q2 2024.
“Together delivered another strong performance in the quarter to March 31, with the loan book reaching a new high of £7 billion while we maintained low LTVs and an attractive net interest margin,” Mike McTighe (pictured), chairman of Together, commented on the results. “Monthly lending increased by 24% and net interest income, underlying profits and cash receipts rose by 32%, 26% and 42% respectively compared with the same quarter last year.
“We continued to shape our business for the future, completing the scope of the transformation project to further improve the experience for our customers and future proof our business, including selecting our new lending platform, nCino. Since the beginning of January, we have also successfully issued two RMBS transactions, launched our first development loan securitisation and refinanced one of our senior secured notes to further strengthen and diversify our funding.
“Looking ahead, while inflation has continued to fall and interest rates are increasingly expected to begin to edge down, UK GDP growth is forecast to remain fairly subdued in the short term. As we celebrate 50 successful years in business, we remain cautiously optimistic about the future and will continue to help our customers realise their ambitions and play our part in supporting the UK economy.”
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