Shares in specialist lender One Savings bank jumped over nine per cent this morning after it released half year resilient results that it said were meeting all its targets.
Although statutory profit before tax leapt from £46.6m to £100.0m, underlying profits were less dramatic, increasing from £47.6m to £64.6m.
New lending increased by 25 per cent from £778m to £973m with a small interest margin improvement from 305 to 307 basis points.
Loss ratios decreased from from 23 basis points to 18 basis points and a 27 per cent increase in earnings per share was passed onto investors as the company grew its dividend from 2.0p to 2.9p per share.
Why its interesting
As a lender that specialises in residential, buy to let and commercial mortgages, secured loans and development finance, One Savings is not operating in an easy market place.
However, its results appear to be resilient to the effects of the increase in stamp duty in April and the Brexit vote in June this year.
One Savings said that in reality all the stamp duty rise did was accelerate sales in the first quarter that would otherwise have been completed in the second.
It added that mortgage applications are "significantly higher" and the company feels well placed to deliver on the buy-to-let market – it focuses on landlords with multiple properties who are "better position to withstand market volatility".
What One Savings said
Chief executive Andy Golding said:
We have achieved all of our financial objectives since IPO and the strength of our balance sheet, together with the high quality of our secured asset portfolio, positions us well in the current uncertain economic climate.
We have continued to grow the loan book through our specialist lending brands. This growth was delivered whilst achieving a net interest margin marginally ahead of full year guidance, in spite of significantly increasing liquidity as a prudent measure ahead of the UK referendum on EU membership.
It is too soon to predict the medium to long-term impact of Brexit on the UK economy, but we will continue to concentrate on what we have proven we do best. We remain well placed to take advantage of opportunities that arise using these well proven capabilities.