Yorkshire Bank group reports 7% growth in mortgages and ‘momentum’ in SME market

Yorkshire Bank’s parent, the Clydesdale and Yorkshire Banking Group (CYBG), has reported a strong start to its 2018 financial year, with a 7.4% growth in mortgages and “momentum” in the SME market during its Q1 trading period.
The bank, which is aiming to be the UK’s leading digitally-enabled challenger bank, reported its Q1 figures this morning, with mortgage balances of £23.9bn, representing annualised growth in Q1 of 7.4%, which it said was driven by a particularly strong pipeline at year-end.
CYBG said it anticipated mortgage growth would ease over the remainder of FY18, adding: ” Although we continue to expect mid-single digit growth in balances for FY18.”
CYBG said: “We maintained momentum in SME origination, with £567m of gross loans and facilities written in the quarter. Strong new business drawdowns of £525m were offset by reduced overdraft balances in our agriculture book.
“As a result, on an annualised basis net core lending grew by 1.4% in Q1. We continue to see a healthy pipeline to support new lending in 2018, in line with our asset growth targets and our commitment to lend £6bn over 3 years to our customers.”
Deposit balances grew by 3.7% in Q1, which the bank said was driven by continued momentum in retail and SME current accounts and personal fixed rate term deposits.
David Duffy, chief executive of CYBG, said: “We have delivered another solid quarter of growth, despite a competitive operating environment, seeing continued momentum in both mortgage and SME lending. While the economic outlook remains uncertain we remain focused on delivering sustainable and prudent growth and are confident we will deliver our guidance for 2018 and the medium term.
“We also continue to take major strides in transforming CYBG into the UK’s leading digitally-enabled challenger bank, positioning us strongly for the future banking landscape. Our iB technology platform is ready for Open Banking today with full ‘plug and play’ fintech capability, meaning we can offer real-time, integrated services for our 2.8 million customers.”
The bank, which in November published its annual figures which saw it deliver its first statutory profit in more than five years, added: “Despite the ongoing uncertainty in relation to the terms of the UK’s withdrawal from the European Union and its potential impact on the outlook for the UK economy, we remain confident in our ability to deliver the Group’s FY18 and medium-term guidance.”