Aldermore Group PLC – Interim Management Statement Q3
Continuing growth in lending and capital generation
Profitable growth with £2.3bn in originations for 9m 2016
• Strong organic growth continues, with net loans up 15% to £7.1bn (end 2015: £6.1bn).
• Growth driven through greater levels of new lending, up 20% to £2.3bn YTD (9m 2015: £1.9bn) as more British SMEs, homeowners and landlords choose Aldermore to serve their needs:
– New lending to business finance customers up 13% to £0.8bn YTD (9m 2015: £0.7bn).
– New lending to Mortgage customers up 24% to £1.5bn YTD (9m 2015: £1.2bn).
• Net interest margin stable in the quarter and in-line with management expectations.
Significant capital growth in the third quarter
• CET1 capital ratio grew by c40bps to 11.5% in Q3, driven by c30bps of organic capital generation and an increase in the value of assets held for liquidity purposes.
• Pro-forma total capital ratio rose to 15.7% (end Q2: 14.0%).
• Tangible book value per share increased by 6% to 146.0p (end Q2: 137.1p).
Further strategic and financial progress
• The first bank to utilise the Term Funding Scheme (TFS) in Q3.
• Successfully issued £60m of Tier 2 notes in October at a coupon of 8.5%; significantly below the cost of our existing Tier 2 issuance.
• Voted leasing & asset finance provider, most supportive lender, and development funder of the year in the NACFB awards.
Phillip Monks, CEO, said:
“I am delighted that Aldermore continues to deliver on our strategy with another strong quarter.
“While the economic and regulatory environment continues to evolve, we have seen no changes in customer demand, our pipeline remains strong and our credit performance robust. As a result, in the first nine months of 2016 we have grown the loan book by over £900m balanced across SME and mortgage customers, whilst maintaining our strict controls on underwriting standards.
“New lending has been funded through the growth of our deposit franchises as well as the use of government funding schemes, including the Bank of England’s newly launched TFS which we began to utilise in September.
“I am also pleased to report that strong organic profit generation has driven our CET1 capital ratio to 11.5% in the quarter, delivering on our IPO commitment of capital self-sufficiency by the end of 2016.
“We look forward to updating you on our progress and outlook at our 2016 full year results in March 2017.”
