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Paragon profit falls but capital position remains 'strong' through Covid-19
StockMarketWire.com
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Paragon Banking Group's profit fell for the financial year ended 30 September 2020, it announced today, largely due to the impact of the Covid-19 pandemic.
Its underlying profit fell to £120 million, down from £164.4 million the previous year, which it said was driven by IFRS 9 expected credit loss charges of £48.3 million, reflecting the impact of Covid-19.
However, its capital ratios remained strong through the period, with the CET1 ratio rising to 14.3%.
Its net interest margin fell slightly to 2.24% from 2.29% a year earlier due to the cut in the base rate.
The company said it intended to pay a full-year dividend of 14.4p per share, reflecting 'resilient performance and strong capital position supporting the growing momentum in the business'.
Chief executive Nigel Terrington said: 'Covid-19 has impacted every individual and business across the UK. However, we entered this year from a position of strength, with strong capital and liquidity, an exemplary loan book and an increasingly diversified business.
'Our lending performance has been robust and we have seen a recovery and growing momentum in new lending activities. Our retail deposit division has had a transformational year, broadening its product range and distribution with balances increasing by 22.9%, at a lower cost, providing us with a reliable, scalable and cost-effective source of funding.'
Story provided by StockMarketWire.com
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