Northern Rock grabs bigger market share
MORTGAGE bank Northern Rock today claimed to be beating the rest of the industry hands down as it revealed new lending up 7% at £5bn compared with a 17% decline for the mortgage industry as a whole.
Chief executive Adam Applegarth said: 'We are very pleased to hold the current pipeline of new business at around the same level as at the start of last year's pipeline.'
But he warned that the overall mortgage market is likely to shrink this year - to around £260bn against 2004's record £291bn.
Applegarth said: 'With this continued evidence of a slowdown in the UK housing and mortgage markets, our strong operating performance in the UK in the first quarter demonstrates the strength of our business model and our ability to deliver against our three key strategic targets - asset growth, profit growth and return to on equity.'
He said the group remains on target to deliver 10% growth in pre-tax profits this year to around £475m. This is before the effect of new international accounting standards, which are likely to hit Northern harder than many other banks because they alter the timing on when profits can be booked on mortgages.
Applegarth also said earnings should grow in line with profits and the dividend payout ratio for 2005 should increase slightly.
Some 30% of Northern's loan book remains in its 'lifestyle' products, including personal loans linked to mortgages, buy-to-let and home equity release..
Shares were 7p lower at 791p in early trading.
