Aldermore extends range as profits double
In 2014 the specialist lender issued £2.6bn in residential mortgages, up from £1.7bn in 2013.
The firm’s return on equity rose from 12% to 15% and accelerated to 19% in the second half of the year.
The bank lent out a net £4.8bn to customers, up 42% compared to the previous year.
Customer deposits rose 29pc to £4.5bn. However a date for the bank’s planned flotation has yet to be set.
Phillip Monks, CEO, said:“2014, was another great year with profit before tax on a like for like basis more than double that generated in 2013 and a return on equity approaching 20% for the second six months of the year.
“We continue to support SMEs and homeowners with our straightforward products and granted £2.4bn of new loans in 2014, our highest level to date. Our innovative online savings franchise also goes from strength to strength, with total deposits up by 29% to £4.5bn overall and, within this, SME deposits almost doubling to over £1bn.
“Our confidence in the outlook is reflected in our improved guidance. In 2015, we again expect to grow net loans in line with the current nominal run rate. We will continue to leverage our legacy-free operating platform and I now expect to deliver a cost/ income ratio of below 40% by the end of 2017.”
And Adam Daniels, managing director, specialist finance and intermediaries at Lloyds Bank Commercial Banking, said: “These were strong results from Aldermore today. The decision not to set a date for the planned flotation means Aldermore may continue to face further speculation on its future direction. When it does announce its IPO, it will be interesting to see what valuation Aldermore attracts, especially if – as reported – rival Shawbrook floats before Aldermore completes its IPO.
“That said, investors have already shown an appetite for other challenger banks, as other successful IPOs have proved recently. Current buoyant stock markets – if they hold – are also likely to help any flotation.
“What today’s results demonstrate, however, is the continuing evolution and strength of competition in the UK banking sector and how crucial it is in ensuring that Britain’s businesses and consumers have proper access and choice regarding the financial services they want and need.”
Elsewhere today Aldermore has launched Help to Buy 5-year fixes at 5.99% to 90% LTV and 6.09% to 95% LTV and two 3-year fixes at 5.99% to 90% LTV and 6.09% to 95% LTV, all with a £999 completion fee.
Charles Haresnape, managing director, mortgages and commercial lending, said: “Aldermore is committed to offering a range of mortgage options to suit individual customer needs and our new buy-to-let and Help to Buy products further highlights this commitment.
“Following the strong growth in mortgage volumes and house prices in 2014, we expect sensible and sustainable growth in the volume of mortgages written this year, with buy-to-let likely to experience further growth when the annuity reforms come into force in April.”
On its buy-to-let range the lender has unveiled 2-year fixes at 4.48% to 75% LTV and 4.78% to 80% LTV, both with a 2.50% fee.
Aldermore has also launched several remortgage-only products, as the lender is offering residential mortgages at 4.58% to 75% LTV, 5.08% to 80% LTV and 5.38% to 85% LTV with no fee.
On buy-to-let Aldermore has also launched a 3-year remortgage only fix at 5.28% to 75% LTV and 5.68% to 80% LTV, while its term variable rates stand at 3.94% to 75% LTV and 4.48% to 80% LTV, both with a £3.00% fee.