Buy-to-let lending provides a lift for Paragon

Paragon said new lending was up 24% to £469.8m, with buy-to-let loans increasing to £342.9m from £185.2m in the same period a year earlier.

New regulations for portfolio landlords introduced by the UK's Prudential Regulation Authority (PRA) had prompted a “realignment of competition” within the sector as mainstream lenders either left or reduced their exposure, Paragon said.

“Paragon’s experience and capability is well aligned with these new requirements, allowing the group to increase its share of more specialist portfolio landlord business,” the company added.

The mix of buy-to-let completions in the quarter was little changed from last year, with complex loans representing 66% of advances and simple completions comprising the balancing 34%.

“However, the impact of the PRA underwriting rule changes from September have had a more profound impact on application flows during the quarter,” Paragon said.

“As a result, the mix in the pipeline at 31 December 2017 had moved to 79% complex and just 21% simple. The December pipeline rose from September's £604.2m to £618.7m.”