Virgin Money reveals hit to mortgage lending since the end of stamp duty tax relief

Virgin Money has revealed a hit to mortgage lending since the end of stamp duty tax relief and due to stiff competition in the market.

The group – formerly known as CYBG – reported a 0.5% fall in mortgage lending to £57.8 billion in its first quarter to December 31.

It blamed the end of the stamp duty land tax relief, which came to a close after tapering to the end of September, as well as ongoing competition in the mortgage sector.

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Virgin Money also said business lending dropped 2.2% to £8.3 billion in the quarter as demand remained “subdued” and as Government’s Covid-19 support schemes began to wind down.

David Duffy, chief executive of Virgin Money, said: “Virgin Money’s performance in the first quarter has been strong. Our balance sheet is performing well, asset quality remains robust and we have increased guidance on net interest margin for 2022."

The group upped the outlook for its net interest margin – a key measure of profitability for retail banks – and highlighted a more buoyant outlook for the wider UK economy.

David Duffy, chief executive of Virgin Money, said: “Virgin Money’s performance in the first quarter has been strong.

“Our balance sheet is performing well, asset quality remains robust and we have increased guidance on net interest margin for 2022.

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“We are optimistic about the pace of recovery of the UK economy based on growing consumer and business confidence, underpinned by lower unemployment.”