Wednesday 5 May 2021 7:28 am

Virgin Money swings to profit on lower bad loan provisions

Banking group Virgin Money today said it had improved half-year earnings after setting aside less cash to cover Covid-driven loan losses.

The bank reported statutory pre-tax profit of £72m the six months ended 31 March, compared to a £7m loss a year earlier when it hade hefty provisions for potential bad loans.

Virgin Money took an impairment charge of £38m during the period, much lower that the £232m it saw a year earlier.

Underlying profit more than doubled year-on-year to £245m, compared to £120m in the first half of 2020.

David Duffy, CEO of Virgin Money, said that the lender remains “cautiously optimistic” about its future as the vaccine rollout continues to deliver positive revisions to economic expectations.

“We’re continuing to manage through what is still an uncertain economic backdrop, but the bank is well placed, with a strong balance sheet, and through ongoing strategic delivery we have a clear path to long-term, improved sustainable returns.”