OneSavings pleased with performance after Charter Court combination

The FTSE 250 company said that at OneSavings Bank, loan book growth stood at 15% for the nine months ended 30 September, with net loans and advances up by £1.31bn to £10.3bn during the period.

New originations totalled £842m in the third quarter period, up from £730m year-on-year, and £2.5bn for the nine months ended 30 September, rising from £2.2bn.

As the board had previously guided, the firm was expecting to deliver net loan book growth in the high-teens for 2019.

It said it expected its net interest margin to be broadly flat for the full-year compared to the first half, also in-line with management expectations

At Charter Court, OneSavings Bank reported loan book growth of 4% for the nine months ended 30 September, or 21% excluding the impact of structured asset sales, with net loans and advances up by £236m to £6.9bn.

New originations totalled £865m in the three month period, up from £708m, and were £2.4bn for the nine months ended 30 September, rising from £2.1bn.

As the company had previously announced, residual interests in three securitisations sold for a pre-tax gain of £58.6m in the nine month period, resulting in the derecognition of £1.29bn of underlying mortgage assets and associated risk-weighted assets, compared to £36.4m and £562.5m year-on-year, respectively.

For Charter Court, the company said it expected to deliver net loan book growth in the high-twenties for 2019, excluding the impact of the structured asset sales, with the full-year net interest margin to be slightly lower than the first half, in-line with its expectations.

“I am delighted that we successfully completed our combination with Charter Court Financial Services Group on 4 October and we are now in the early stages of integrating the two businesses,” said chief executive officer Andy Golding.

“We remain focused on delivering shareholder value as we execute on the strategy for the enlarged group.

“Continued strong performance from both groups in the first nine months of the year delivered 15% net loan book growth for OSB and 21% for CCFS, excluding the impact of structured asset sales.”

Golding said both banks’ lending franchises were performing “very well”, with strong levels of applications at “attractive margins” across its core product types, building a robust pipeline for the first quarter of 2020.

“In addition to strong retail savings franchises, we have excellent capabilities in the securitisation market which allow us to diversify our funding.

“I am pleased that in July, OSB securitised £500m of organically originated mortgages under our newly established Canterbury Finance RMBS programme, which was well received in the market.”

Golding also noted that during the quarter, Charter Mortgages successfully sold a residual interest in the Precise Mortgage Funding 2019-1B plc, which generated a pre-tax gain of £28.8m.

“We remain cognisant of the continued uncertain macroeconomic and political outlook, however we believe that as a combined business we are well placed to continue to deliver on our strategy and generate attractive shareholder returns through the cycle.”

At 0946 GMT, shares in OneSavings Bank were down 0.27% at 369.4p.