(Sharecast News) - Banking group Virgin Money UK said it has delivered a first-quarter performance in line with guidance with growth in new accounts, deposits and target lending activities at stable margins.
Mortgage lending was 0.7% lower over the three months to 31 December at £57.1bn, and down 2.2% compared with the first quarter of the previous year, but the company noted "improving sentiment" in the market as interest rates have peaked.
The quarterly decline "reflecting disciplined approach to trading in subdued market [but there are] early signs that market activity has improved in January, increasing back to 2019 levels".
Business lending rose 3.2% over the quarter to £9.0bn, up 6.7% year-on-year, while unsecured lending was up 2.8% at £6.7bn, up 7.8% year-on-year.
As a result, total customer lending rose 0.1% to £72.8bn, more or less stable with last year. Meanwhile, customer deposits increased by 1.0% to £67.3bn.
Net interest margin (NIM) - the amount it earns in interest on loans compared to the amount it pays out in interest on deposits - was stable over the three-month period at 1.89% "with benefits from structural hedge reinvestment rate and ongoing cards EIR outperformance offset by mortgage spread pressure and deposit competition", Virgin Money explained.
The company said that NIM should remain "resilient" over the rest of the financial year, even in light of reduced interest-rate expectations.
