Improved mortgage lending in the opening nine months of 2015 and progress on a new small business initiative helps Richard Branson-backed bank Virgin Money (VM.) nudge 0.2% higher to 404p today.

The current account, savings, insurance and pension provider saw gross mortgage lending, the total amount of new funds lent, increase 38% to £5.5 billion in the nine months to 30 September.

Net mortgage lending, gross loans minus loans paid back, almost doubled, rising 98%, during the same period to £2.6 billion.

Credit card lending in the three months to 30 September increased 28% to £1.4 billion. That's almost half way towards Virgin's £3 billion target.

Growing its mortgage and credit card businesses are core strategies for the 75-branch high street bank.

Virgin is also planning to move into the small and medium-sized enterprises lending market (SME) and has recruited 25-year SME banking veteran George Ashworth.

He has stints at Aldermore (ALD) and ABN AMRO on his CV.

Web - Virgin Money - 15 October 2015

Investec analyst Ian Gordon is impressed by the performance.

‘Virgin Money’s sceptics may have had the upper hand over the past couple of months, but it continues to meet or beat implicit market expectations and its own guidance for new business volumes and the evolution of net interest margin.’

Virgin's net interest margin, the difference between the average interest rates received and paid by the bank, is currently 1.65%, ahead of a 1.6% target for the year.

Issue Date: 15 Oct 2015