Virgin Money UK delivers 'strong profitability' in Q3

Clydesdale Bank parent company Virgin Money UK said on Tuesday that it had delivered "strong profitability" in its third quarter, leaving the group with a "robust" balance sheet as it commenced its inaugural buyback.

Virgin Money UK said it had seen a 45% year-on-year increase in digital personal and business current accounts sales, roughly 45,000 in total.

160,000 new credit cards were opened in the quarter following its record second-quarter performance, while unsecured lending grew 3.8% to £6.0bn, driven by growth in high-quality credit card balances from strong new account growth, higher retail spending, and new digital propositions.

Mortgages were said to have remained "stable" at £57.8bn and business lending was up 0.3% at £8.3bn.

Virgin Money also said its net interest margin remained strong in Q3 at 187 basis points, up from 183bps at the half, supported by higher rates, deposit spreads, and higher yielding lending mix, offset by ongoing mortgage spread pressures.

The FTSE 250-listed group also noted it had commenced its inaugural share buyback programme, with an initial repurchase of £75.0m following a "resilient performance" in its solvency stress test, supplementing a 2.5p interim dividend.

As of 0940 BST, Virgin Money shares were down 1.15% at 142.25p.

Reporting by Iain Gilbert at Sharecast.com