Home lending surge helps Virgin Money
PUBLISHED: 12:10 01 May 2015 | UPDATED: 16:29 01 May 2015
Virgin Money has recorded a buoyant start to the year as it upped its share of the mortgage market with a 34pc rise in lending.
The Newcastle-based group, which has a significant presence in Norwich, celebrated its 20th anniversary in March, captured an estimated 3.6pc share of a declining market, with gross mortgage lending of £1.6 billion in the three months to the end of March.
It has also started the current quarter with a strong pipeline due to the high number of mortgage applications received in the first quarter.
In March, Virgin targeted a market share above 3pc, having achieved 3.1pc in the second half of last year.
Credit card balances stood at over £1 billion at the end of the quarter following the migration of about 675,000 MBNA credit card accounts in March. The credit card business is now fully operational on Virgin’s own platform as the group targets £3 billion of credit card balances by the end of 2018.
The roll-out of its Essential current account has now taken place across all its 75 stores, most of which were inherited following its Northern Rock takeover.
It hopes the outcome of an ongoing competition investigation into the banking sector will leave it well placed to attract more current account business.
Virgin said: “We continue to challenge the barriers to entry and anti-competitive nature of the current account market - particularly the free-if-in-credit model and lack of fair access to the payments infrastructure.
“While these conditions persist, we have limited our participation in the market and continue to build capability in order to be ready for the future.”
The lender employs more than 2,500 staff, with 1,700 based in Gosforth, Newcastle, and 200 in Norwich.
Last month, it more than doubled its profits in its first set of annual results since it floated last year.
The company,which made its stock market debut last November, said pre-tax profits stripping out one-off items grew 127pc to £121.2 million in 2014.
However statutory profits fell sharply from £185.4 million to £34 million, when costs including £12.6 million for the float, as well as the gain from the sale of a subsidiary in 2013, were included.