The firm said this was a result of its decision to focus its efforts on “higher margin, professional business”. It noted its specialist buy-to-let lending grew by 1.1 per cent year-on-year to a total of £375.4m.
In addition, the quarter end pipeline figure for buy-to-let lending totaled £814m, up by 11.6 per cent from the same period the year before, of which 92 per cent was classified as specialist lending.
On commercial lending, new business volumes jumped by 19.9 per cent on the same period from 2018, to £254.1m. It said this faster growth was a reflection of its low market share relative to its mortgage division.
Overall, new business volumes were 2.7 per cent higher than the previous year at £684.9m, with the net loan book increasing by 1.6 per cent over the quarter to £12.4bn. The bank said this was in line with management expectations.
Nigel Terrington, chief executive of Paragon, said that the bank had made good progress in its key decisions, adding: “Our loan portfolios continue to deliver an exemplary credit performance. We look forward to the year ahead with confidence as we continue to pursue a diversification strategy.”
However, he cautioned that it was too early to tell whether recent positive surveys into improving confidence levels could be sustained, emphasising that the bank will “continue to maintain conservative risk appetite”.