Virgin Money appoints Moreno chairman, readying for IPO

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Virgin Money, the British challenger bank partly owned by entrepreneur Richard Branson, said Glen Moreno will become chairman next year and reported strong first-half profit growth, putting it in good shape for an impending stock market listing.

Moreno, who is chairman of publisher Pearson, will replace David Clementi as chairman in mid-2015, the banksaid. He will become an independent non-executive director and chairman designate from January 2015.

Moreno has previously been senior independent director at Lloyds Banking Group and acting chairman of UK Financial Investments, which manages the British government’s stakes in bailed-out banks.

Virgin Money reported underlying pretax profit of £59.7m, up from £13.1m the year before. Total income increased by 28.3 per cent to £210m.

The bank said its performance had benefited from growth in net interest margin - the difference between the interest the bank lends at and what it pays to savers and a key driver of income - which had risen to 1.43 per cent from 1.1 per cent the year before.

Virgin Money said its core Tier 1 ratio, a key measure of its financial strength, was 14.4 per cent. The Prudential Regulation Authority currently sets a minimum requirement of seven per cent but is expected to demand 11 per cent in the future.

Its leverage ratio, which measures the amount of equity a bank holds as a percentage of its loans, rose to 3.8 per cent. The regulator currently expects banks to hold three per cent but the requirement is expected to increase to four per cent.