Paragon Bank has revealed there are some encouraging signs of recovery in the economy and mortgage markets as the Covid-19 lockdown eases, according to their latest trading update.
Despite positive signs, the specialist lender warned that “uncertainty will remain for some time to come” as restrictions change throughout upcoming months.
In the nine months to the end of June, Paragon reported a fall in their mortgage advances of 13 per cent, whilst commercial advances during the same period fell 12 per cent.
After the group’s buy-to-let finance pipeline falling to its lowest point of £598.7m at the end of May, it now currently stands at over £700m.
Paragon commented that the recovery in new business flows following the Covid-19 lockdown restrictions has been encouraging.
In addition, it also added that new activity and demand in the commercial lending division has seen improvements over recent weeks, with a steady growth reported in development finance and a secure position in SME lending.
Latest data also showed that just under 21 per cent of the group’s loan balances have had a payment deferral at some point due to Covid-19, of which around 75 per cent have not requested any further assistance.
When commenting on the full economic affect of Covid-19, Paragon said the extent remains uncertain – making it difficult to provide guidance for the rest of the year.
Nigel Terrington, chief executive, said: “Our people and operations have shown considerable resilience, agility and adaptability during this difficult period.
“New business flows have picked-up from their April lows and with improving performance in customer payments no additional overlay provision has been required.
“There may well be further challenges to come from this crisis, which we are well placed to deal with. We have strong levels of capital and liquidity and are well placed to develop our core businesses as well as make the most of any potential opportunities that will arise in future.”
Original article featured here…