According to OSB Group’s interim results, this was driven by its “continued focus on returns and diversification into higher-yielding sub-segments”.
Speaking to Specialist Lending Solutions, Jon Hall (pictured), group managing director of mortgages and savings, said: “We are on track. It is still early days in the change in strategy that we presented in March, and from that perspective, the update is that we are on track with room to grow.”
The report pointed to originations in its commercial sub-segment more than doubling to £310.9m, while asset finance and bridging originations rose by 59% and 73% year-on-year to £123.3m and £331.2m respectively.
Residential originations dropped by 25% year-on-year to £288.7m, while residential development originations grew by 28% year-on-year to £113.1m.
Buy-to-let (BTL) originations came to £935.4m, a drop of 9% year-on-year, making up around 69% of its total gross loan book.
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The latter is a drop from 70% at the end of 2024 and is in line with its “diversification strategy” to cut BTL lending to equal to less than 60% of its loan book in the next four years.
Also speaking to Specialist Lending Solutions, Adrian Moloney, group intermediary director at OSB Group, said it had expanded what it had done in bridging and commercial and launched its specialist real estate team, which had been “well-received” by brokers.
He also pointed to Precise launching deals at 90% and 95% loan to value (LTV) – which had boosted borrowers’ access – and adding automatic valuations models (AVMs) to its bridging process.
Looking at gross loans, total BTL gross loans stood at £17.6bn, in line with last year, and total residential gross loans came to around £5bn, a slight drop of 3% year-on-year.
Commercial gross loans came to £1.5bn, asset finance came to £381.9m, residential development came to £302.7m and bridging came to £480.2m. These are annual rises of 14%, 21%, 16% and 32% respectively.
The report stated that its net loan book had increased by 1.2% year-on-year to £25.4bn.
Arrears balances of three months or more rose slightly to 1.8%, up from 1.7% at year end.
OSB Group’s pre-tax profit came to £192.3m in the first half of the year, which compares to £241.3m in the same period last year.
The drop was attributed to lower net interest income and a net fair value loss on financial instruments, which compares to a gain in the prior period. There was also an impairment charge during the period.
The company said it expected its loan book growth to be modestly higher than 2025 in 2026.
Rely pilot will expand in September and is set to be ‘BTL superpower’
Moloney said it was continuing to pilot its Rely brand and it was looking to expand the pilot in September to another 30 broker firms for Phase 2.
OSB Group announced earlier this year that it would retire the Kent Reliance for Intermediaries brand and launch a new brand called Rely that would be a “BTL powerhouse”.
Moloney said the initial feedback from brokers in the pilot so far was good and they had had cases go to offer, which he said was “really positive”.
“The feedback from the brokers is that they like what it does. It’s reducing the amount of [work] they have to do. It utilises different valuation pathways and legal pathways, so we’re taking it all as positive at the moment,” he added.
Hall noted that the Rely brand was “consolidating all that BTL experience into one BTL superpower”.
“I think that the intermediary market and some of our competitors have really looked at that and said that’s a really kind of powerful move, and that’s very understandable given the shifts in the BTL market towards those professional landlords,” he said.
Both said the new platform had also given them much more flexibility in bringing products to market and catering to different BTL businesses, and that would position the firm well going forward.
When asked whether other lenders may mimic OSB Group’s strategy, Hall said it was “highly likely”.
“We’re all about being number one for the intermediary, making their life much more straightforward and making us easy to do business with and to be successful with. This is just a continuation of that and so I don’t doubt that people might [copy us], it’s inevitable,” he added.
