Lender reports stronger second-half lending and a 48% surge in new business pipeline
Specialist lender Paragon Bank has reported a 4.4% increase in its buy-to-let mortgage loan book, citing strong retention rates, new lending growth, and a rebound in its new business pipeline as key drivers.
In its full-year results for the 12 months ending September 30, 2024, the lender’s buy-to-let loan book grew to £13.3 billion. New buy-to-let lending for the year totalled £1.49 billion, while the new business pipeline rose by 48.2% year-on-year to £881.4 million.
Paragon Banking Group’s overall performance saw operating profits before fair value items increase by 5.4% to £292.7 million. Its total net loan book grew by 5.6% to £15.7 billion.
The bank saw an uptick in lending during the second half of the financial year, with completions rising 30% compared to the first half, reflecting improved market sentiment.
Paragon also highlighted progress in environmentally focused lending, with £795.3 million in buy-to-let loans issued for properties with an energy performance certificate (EPC) rating of ‘A’ to ‘C’, representing 53.4% of total completions. This marks an increase from 49.9% in the prior year.
Buy-to-let mortgage redemptions declined to 6.7%, down from 9% a year earlier, with the reduction primarily in Paragon’s legacy pre-2010 book. In contrast, its post-2010 buy-to-let book, which serves landlords with larger portfolios and more specialised needs, expanded by 9.7%, accounting for 79.2% of the mortgage division’s total assets.
Arrears in the buy-to-let portfolio rose slightly to 0.38%, up from 0.34% at the same point in 2023, though this represented a drop from 0.68% reported at the end of March 2024.
“2025 promises to be an exciting year for Paragon,” said Louisa Sedgwick (pictured), managing director of mortgages at Paragon Bank. “We are launching our new, bespoke mortgage originations platform, making it quicker and easier for intermediaries to submit cases, which will reduce the time from application to offer.”
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