Clydesdale Yorkshire Bank Group (CYBG) said its third-quarter trading was in line with its expectations and reported a 3.8 per cent rise in mortgage balances to £24.2 billion as of June 30 from the year-earlier quarter from a year ago.
CYBG, which is buying Virgin MOney in a billion pound deal, said its net interest margin (NIM) was maintained at 218 basis points in the nine months to June, as margins improved on lending to small- and medium-sized businesses (SME) and liquidity costs fell.
David Duffy, Chief Executive Officer of CYBG PLC, said: “We have delivered another solid performance this quarter, achieving sustainable lending and deposit growth in a highly competitive market while maintaining a stable net interest margin and delivering further cost and process efficiencies in the business. We remain on track to deliver our guidance for FY18.
Our position as one of the UK’s leading digital banks continues to strengthen: in May we launched our fully API-enabled account aggregation for customers and this month we announced a new innovative partnership with PayPal underlining our ability to work with tech players large and small to deliver new and convenient services for customers.
“The economic and political environment in the UK remains uncertain, but we remain focused on delivering our strategic objectives and capturing further growth opportunities. This includes the RBS Alternative Remedies Scheme where we plan to play a significant role following confirmation of the scheme timetable.
“We continue to expect our recommended all-share offer for Virgin Money to complete in calendar Q4 2018, subject to shareholder and regulatory approvals, creating the UK’s first true national competitor to the status quo.”
The company, one of Britain’s challenger banks that emerged after the global financial crisis to fill a gap in small business lending, stuck to its NIM target of 220 basis points for the year.
The company said new business lending to small- and medium-sized businesses rose 4.7 percent to £7.1 billion in the three months ended June 30.
Britain’s housing market has cooled since the 2016 Brexit vote, which led to a rise in overall inflation and increased uncertainty among investors.
British house prices remained flat in June and the market was likely to stay sluggish in the coming months despite more properties being put up for sale, the Royal Institution of Chartered Surveyors said earlier this month.