Cheshire financial services group reports strong second quarter
Together Financial Services, the Cheshire mortgage and loan provider, continued to deliver a strong financial performance, it said in an update on second quarter trading today.
During the three months to December 31, 2019, the Cheadle group achieved strong new lending volumes which drove the loan book to more than £4bn.
US financial ratings group S&P revised its outlook on the group from Stable to Positive.
Group chairman, Mike McTighe, said today: “Together continued to achieve strong growth in new lending during the quarter, with the loan book reaching a new high of £4.2bn, driving robust increases in underlying profitability and cash generation.
“Average monthly loan originations were up 19.8% on the same quarter last year, while weighted average origination LTVs (loan to value) remained very conservative at 58.0% for new lending and 54.9% across the whole loan book.
“The group continued to deliver a strong financial performance, with underlying profit before tax up 17% on Q2 last year at £36.5m and cash receipts up 19.2% at £432.6m.”
He said: “We further enhanced our governance with the recent appointments of John Hooper to the board of our personal finance business and Gerald Grimes as group CEO designate to add additional breadth and bandwidth of the executive team and to provide a clear succession plan.
“We continued to strengthen and diversify our funding during the quarter, completing our third public residential mortgage-backed securitisation and upsizing our private revolving Lakeside securitisation to £500m.
“Earlier this month, we also successfully issued £435m of 4⅞% senior secured notes, upsizing from the initial £385m to meet the significant levels of demand from investors.”
He added: “While lead indicators continue to be mixed, a recent pick up in business confidence following the UK General Election result and the passing of the EU Withdrawal Agreement Bill by Parliament has led some economists to highlight possible early signs of a recovery in the UK economy.
“Unemployment is at its lowest level since the mid-1970s, wage growth has accelerated to its highest levels in a decade, and the Bank of England’s Monetary Policy Committee has recently maintained UK base rates at 0.75%.
“However, the continued spread of the coronavirus and ongoing tensions between the US and Iran have contributed to financial markets remaining volatile.
“Despite this macroeconomic uncertainty, we continue to see strong demand from our customers and believe the group remains well placed to deliver on its growth plans.”