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Paragon records strong development finance lending growth

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Paragon recorded strong growth in its development finance lending volumes and new business pipeline during the first half of its financial year on the back of robust demand from SME housebuilders.

Results from Paragon Banking Group for the six months to 31 March 2021 revealed lending volumes in the development finance business grew 16% year-on-year to £229.5 million.

Meanwhile, Paragon’s development finance arm’s new business pipeline recorded a 65% increase compared to the same period last year to £320 million. The net loan book grew to £552.3 million at the end of the first half, against £502.3 million recorded in March 2020.

Development finance Managing Director at Paragon Robert Orr said: “These are a strong set of numbers which reflect our commitment to supporting SME housebuilders across the country. The housebuilding sector quickly recovered from the initial impact from the pandemic and our customers are seeing strong demand for new build homes. Sentiment is positive, with developers optimistic moving forward.”

Paragon added four new Relationship Directors and Portfolio Managers during the period to increase its regional focus, bringing the total team to 39.

It also expanded its range of offerings to include projects in the £400,000 to £1,000,000 range, widening its potential market to include smaller, growing developers as they expand their businesses.

Additionally, it increased the maximum amount it was prepared to lend on high quality propositions to 70% of the total development value.

Looking forward, Paragon will focus on expanding its geographical presence to support housebuilders across England, complementing its core southern market.

Robert Orr added: “We have been growing our presence outside of the south over the past two years and we will accelerate that going forward. We have recruited new Relationship Directors to focus on regional growth and have funded numerous projects in many regions outside of the south over the past year. We expect to grow that further.”

Overall, the strong set of results saw Paragon Banking Group post a 44.9% increase in underlying profits to a record high at the half year of £82.9 million, with statutory profit before tax up 68.8% at £96.4 million. You can see a copy of Paragon’s half-year results statement here.

For further information contact:

Michael Clarke
Head of Media Relations
Paragon Tel: 07740090746