OneSavings Bank buys portfolio of UK residential mortgages

The portfolio had an outstanding balance of £112m at the end of February and is being acquired at a discount to par. The transaction will be satisfied by cash from OneSavings’ existing resources.

The challenger bank said around 94% of the mortgages are owner-occupied and the rest buy-to-let with a weighted average current loan-to-value of around 75%.

It added that the portfolio is well diversified across the UK regions.

Group commercial director Jens Bech said: "We are delighted to further demonstrate our ability to acquire high quality loan portfolios at attractive prices, which complements the company's organic origination strategy.

“We have a disciplined investment process and make acquisitions where there is a strong fit in terms of strategy, risk profile and projected financial returns. We will continue to evaluate inorganic opportunities as they arise."

At 1513 GMT, shares in the bank were down 1.3% to 311.10p.