The Paragon Group of Companies has reported its results for the final quarter of 2014.
Operating profits were £30.9 million compared with £26.9 million for the corresponding period in the previous year, representing a 14.9% increase.
Pre-tax profits, after a debit of £0.7 million for fair value hedging items, were £30.2 million for the period.
During the quarter, buy-to-let completions across the Group were £222.1 million, an increase of 58.4% compared to the same period in the last financial year. Of this, £193.3 million (87.0%) was originated through Paragon Mortgages and £28.8 million (13.0%) through Paragon Bank.
At 31 December 2014, the pipeline of buy-to-let business (including Paragon Bank) stood at £416.7 million. This compares to £222.5 million at the same point in 2013 and supports further growth in completions in the second quarter.
At 31 December 2014, the Group’s arrears on its buy-to-let portfolio stood at 22 basis points, showing continued strong performance from the 25 basis point level reported at 30 September 2014. Redemptions across the buy-to let portfolio were £96.9 million for the period to 31 December, representing a modest reduction from the £106.5 million seen in the quarter to 30 September 2014.
At 31 December, Paragon Bank’s buy-to-let pipeline stood at £44.4 million.
In November 2014, the Group completed its latest securitisation of loan assets through Paragon Mortgages (No.21) PLC. This brought total securitisation note issuance to £929.7 million in the 2014 calendar year.
During the quarter to 31 December 2014, the Group’s £250 million mortgage warehouse facility provided by Macquarie Bank was renewed on finer terms and is now available for drawing until December 2016.
John Heron, managing director of Paragon Mortgages, said: “We continue to benefit from an increase in the scale of our funding capability and, as a result of the deposit raising capability of Paragon Bank, improved diversity of funding.
“This has allowed us to continue developing our buy-to-let proposition for landlords and their intermediaries and we now have our most complete and competitively priced range of buy-to-let products. The fact that the pipeline continues to grow demonstrates well that the business has a good platform in place for further development through 2015.”
