Remain Supporting Virgin Enjoys Brexit Boom

Richard Branson

(REUTERS) – British lender Virgin Money Holdings Plc (VM.L) reported a 19 percent jump in nine-month gross mortgage lending, and said customer demand continued to be strong after Britain’s vote to leave the European Union.

Virgin Money’s gross mortgage lending for the January-September period rose to 6.5 billion pounds ($7.94 billion), representing a 3.6 percent share of the UK mortgage market.

The bank said there were no material changes in customer behaviour after Britain’s June 23 vote to leave the EU, in line with larger UK banks reporting resilience in demand after the vote.

Virgin Money, which counts itself among the bigger “challenger” banks in Britain, said the Bank of England’s rate cut in August resulted in a headwind to net interest income of around 5 million pounds, and net interest margin is expected to be just below 160 basis points in 2016.

Credit card balances rose to 2.2 billion pounds at the end of September, 41 percent higher than full-year 2015, Virgin Money said.

The company, which listed on London’s main market in 2014, remains on track to meet a target of 3 billion pounds in card balances by the end of 2017, it said.

Mortgage balances at the end of September were 28.9 billion pounds, up 14 percent from the end of last year.

The Council of Mortgage Lenders (CML) estimates that gross mortgage lending reached 20.5 billion pounds in September, making it the highest September figure since 2007, when gross lending reached 29.9 billion pounds.

Gross mortgage lending for the third quarter of 2016 was estimated at 63.6 billion pounds, the council said, 4 percent higher than a year earlier and 11 percent higher than the second quarter.

Mortgage lending was driven by attractively priced mortgage deals encouraging borrowers to refinance, CML said.

Newcastle-based Virgin Money said the gross mortgage lending market share was calculated based on Bank of England data.

(Reporting by Noor Zainab Hussain in Bengaluru; Editing by Amrutha Gayathri)


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