Sancus’ H1 new loan facilities rise by 62 per cent to £86m YOY

The lender added that this exceeded its full-year new loan facilities written in 2021, which came to £83m.

In its interim results, Sancus said that the loan book stood at £147m, which is up by £5m compared to its full-year loan book last year.

Sancus said that lender book growth came to 144 per cent in in the year to June 2021 and Irish market loan book growth was 150 per cent in the year to June 2021.

The lender said that it expected growth in the loan book to increase in the second half of the year as newly written loans continue to be drawn.

It said that UK and Ireland were “key areas of investment” for the group and anticipated further offshore business.

It added that there were no new IFRS9 provisions during the period, which compared to a £3m loss in the same period last year.

Group revenue during the first-half of the year came to £4.8m, which is slightly down from £5m in the same period last year.

Sancus reported a group operating loss for the period of £2.1m, which is about half the operating loss of £4.1m in the same period last year.

The specialist lender said it had invested in “rebuilding and reinforcing” the team, with the headcount rising from 32 at the end of 2021 to 42 at 30 June 2022. It said it “did not envisage further material hires”.

It continued that the largest growth in teams were in its origination and loan management teams.

‘Attractive opportunities for alternative lenders’

Sancus noted that it was “seeking to work with a diversified mix of funders”, with four main sources including co-funders, a loan note program, institutional funders and proprietary capital. It said that co-funders remained its largest funding channel.

“The availability, cost and flexibility of funding is key to achieving our growth ambitions and we are reviewing the capital position of the business with a view to ensuring it is best placed to grow funding capacity on market adjusted improved terms,” it said.

Rory Mepham (pictured), chief executive of Sancus Lending, said: “Despite the uncertain outlook for the economy, the perennial imbalance between supply and demand for housing continues to offer a favourable landscape for the group’s anticipated growth in its target markets.

“The economic uncertainty is likely to lead to the continued retrenchment of banks from both SME and development financing which further provides attractive opportunities for alternative lenders.”

He added: “We continue to track the geopolitical situation closely and note the potential for further supply chain disruption and inflationary risks in the construction sector.

“We continue to be enthusiastic about the opportunities that lie ahead of us and look forward to delivering profitability.”