Virgin and Shawbrook reap benefits as challengers to banking status quo

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CHALLENGER BANKS Virgin Money and Shawbrook reported healthy rises in profitability after bringing new competition to Britain’s financial services industry.

The pair are among several new entrants to emerge since the financial crisis as the Government and customers alike sought alternatives to the Big Five lenders - Lloyds, HSBC, Royal Bank of Scotland, Barclays and Santander UK.

Virgin Money saw its profits jump in the first six months of the year as the lender boosted its share of the mortgage market.

The Newcastle-based group said its underlying profits beat City expectations, leaping by 37 per cent to £81.8m in the half year to the end of June, driven by its new mortgage business.

Newly-listed Shawbrook, chaired by Iain Cornish, said its first-half profit nearly doubled, driven by an increase in its loan book.