Volume and margin growth delivering record profits

Paragon Banking Group PLC

Financial results

Six months ended March 2022

Strong operational and financial performance

Financial performance

Strong new business growth

Robust balance sheet

  • Operating profit £105.5 million, up 27.3% on H1 2021
  • Pre-provisionprofit up 20.1%
  • Underlying EPS +29.4%
  • Underlying NIM trajectory (2.57%, +25bps on H1 2021) accelerated by liability-side gains
  • Underlying RoTE 14.9%
  • Dividend at 9.4p in line with policy; DPS +30.6% on H1 2021
  • Net loan growth 8.6%; strong originations and good customer retention
  • Period end pipelines strong, BTL at record levels
  • Deposit balances +14% year-on-year
  • Good progress on digitalisation transformation strategy
  • Exemplary and disciplined credit standards
  • Impairment overlays remain and LTVs reduced further given strong HPI
  • Capital strong, CET1 15.4%, IRB continuing to progress
  • £25 million extension to the buy-back programme announced

2

Financial overview

Richard J Woodman

Chief Financial Officer

3

Income statement

£ million

2022 H1)

2021 H1)

Change)

Net interest income

175.2)

147.5)

+18.8%)

Favourable rate and volume impacts

Other income

6.5)

7.2)

(9.7%)

Maintaining recent trends

Total operating income

181.7)

154.7)

+17.5%)

Operating expenses

(74.9)

(65.8)

+13.8%)

Reflects investment / in line with expectation

Pre-provision profit

106.8)

88.9)

+20.1%)

Impairments

(1.3)

(6.0)

-78.3%.

MES remain conservative

Operating profit

105.5)

82.9)

+27.3%)

Fair value net gains / (losses)

38.1)

13.5)

+182.2%

Favourable impact focused on pipeline hedging

Profit before taxation

143.6)

96.4)

+49.0%)

Reported earnings per share

44.4p

29.3p

+51.5%)

Underlying earnings per share

32.6p

25.2p

+29.4%)

4

Segmental results

Strong pre-provision profits in both key divisions

Underlying £ million

Mortgage Lending

Commercial Lending

Idem Capital

Central

Total

Total operating income (H1:22)

124.9)

57.6)

8.3)

(9.1)

181.7)

Change (v H1:21)

+18.9)

+7.0)

(2.7)

+3.8)

+27.0)

Operating expenses

(9.3)

(12.8)

(2.6)

(50.2)

(74.9)

Change

(0.6)

(1.1)

(0.1)

(7.3)

(9.1)

Pre-provision profit

115.6)

44.8)

5.7)

(59.3)

106.8)

Change

+18.3)

+5.9)

(2.8)

(3.5)

+17.9)

Provisions for losses

1.0)

(3.2)

0.9)

-)

(1.3)

Change

+5.9)

(1.9)

+0.7)

-)

+4.7)

Operating profit

116.6)

41.6)

6.6)

(59.3)

105.5)

Change

+24.2)

+4.0)

(2.1)

(3.5)

+22.6)

5

This is an excerpt of the original content. To continue reading it, access the original document here.

Attachments

  • Original Link
  • Original Document
  • Permalink

Disclaimer

Paragon Banking Group plc published this content on 14 June 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 14 June 2022 06:12:05 UTC.