Together reveals latest financial results

Jessica Nangle

February 25, 2021

mortgage products drop

Together has revealed its latest financial results for the quarter ended 31 December 2020.

The group loan book was £3.9bn on 31 December, which is down 6.6% compared to the £4.2bn recorded a year previously and -2.9% from September 2020, however redemption levels remained strong whilst the group cautiously increased new lending.

Loan book weighted average indexed LTV reduced to 52.2% compared with 54.9% in Q2 2020 and 52.4% at Q1 21.

Underlying profit before tax was £38.2m, which is up 4.7% compared with £36.5m in Q2 20 and up 12.7% compared with £33.9m in Q1 21, due mainly to a reduction in impairment charge during the quarter.

Average monthly loan originations was recorded at £74.4m, down 63.8% compared with £205.8m in Q2‘20 however up 70.6% from £43.6m in Q1‘21 as the group continued its cautious growth in new lending.

Loan originations continued to increase in January 2021 to £104m.

Weighted average origination LTVs were 58.5%, which remains in line with figures recorded in Q2 20 and Q1 21.

Net interest margin remained healthy at 6.5% particularly given the conservative LTVs and consequent high levels of collateral underpinning the quality of the loan book.

Gerald Grimes, group chief executive designate of Together, said: “Together delivered another robust performance in the quarter to 31 December, as we remained focused on supporting our customers, protecting our colleagues and shaping our business for the future.

“Average monthly lending rose to £74.4m as we continued to cautiously increase originations, with the loan book ending the quarter at £3.9bn with a very conservative LTV of 52.2%.

“We remained highly profitable and cash generative, with underlying profit before tax increasing to £38.2m and cash receipts increasing to £430.6m as redemptions continued to be strong during the quarter and, at 8 February, the group had accessible liquidity of £366m.

“We also further extended our funding headroom with the successful issuance of a £500m bond in January, the first sterling corporate bond issuance in 2021 and since the formal completion of the Brexit process.

“The issuance was upsized by £50 million on the back of strong investor support and contributed to the group having undrawn facility headroom of £1,127m at 8 February.

“While we expect economic conditions to remain uncertain for some time, with strong levels of capital and liquidity and our modernisation and transformation programmes underway, we believe the group is well positioned to take advantage of future market opportunities and to play our part in supporting the UK’s economic recovery.”

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