According to Shawbrook’s interim results for the first half of the year, the loan book growth was due to “strong originations in our core SME and property markets”.

The lender said that it had “further strengthened and diversified” its funding base, with deposits growing by nearly a quarter year-on-year to £15bn.

The underlying profit before tax came to £124.5m, which compares to £149.3m in the same period last year.

The firm said that there was “stronger origination” in its retail mortgage brands, which had led to a lower net interest margin (NIM) from a different business mix.

“We expect margins to widen as our origination mix re-weights across all of our specialist lending markets,” Shawbrook said.

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The company said that its arrears ratio was 2.7%, which is up from 2.3% at the end of last year.

Shawbrook said that it had also completed an additional retained securitisation of £600m of The Mortgage Lender’s buy-to-let (BTL) assets, which offered “further liquidity benefits” to the group.

The group said that it had continued to invest in and strengthen its digital capabilities, which included scaling its lending hub so it processed around 40% of real estate cases, lowering the time to offer for up to 70% of its digital BTL cases.

The company has also streamlined its digital SME customer journey and upped the maximum size of its loan to £10,000, so it could “widen our reach and serve more customers at speed”.

Shawbrook added that it had diversified its product offering, including its structured real estate proposition, which is aimed at landlords for complex transactions up to £35m.

 

Shawbrook delivers ‘strong financial performance’ in H1

Marcelino Castrillo, Shawbrook’s CEO, said that the firm has “delivered strong financial performance in the first half of 2024”, pointing to its strong loan book growth and underlying profit before tax.

He continued: “The attractive returns we continue to generate have been re-invested in our ‘best of both’ model, combining innovative technology and data analytics with great talent, enabling us to efficiently scale up our specialist proposition.

“The number of customers we served increased by more than a fifth to c.550,000 (H1 2023: c.450,000) as we continued to expand our presence across a diverse range of markets where customers value the premium experience, flexibility and certainty we deliver.”

Castrillo said that it continued to “leverage attractive inorganic opportunities to accelerate our strategy and extend our footprint in specialist markets”.

This includes its agreement to buy JBR Auto Holdings Ltd, and the completion is expected in the second half of the year.

“This acquisition will help us to extend the JBR proposition to more customers and to broaden our offering within the specialist motor finance market,” he noted.

Castrillo continued: “Shawbrook’s established model continues to demonstrate our adaptability, resilience and ability to deliver strong returns. Looking ahead, our focus on our core specialist products and markets, together with continued efficiency improvements, will ensure we are able to maximise capital generation to facilitate further re-investment in our model and drive future growth and value creation.”