Paragon Banking Group PLC on Wednesday announced a new share buyback and reported healthy annual earnings.

The Solihull, West Midlands-based mortgage and loan provider reported total operating income of £466.0 million for the year ended September 30, up 19% from £393.0 million.

Pretax profit declined by 52% to £199.9 million from £417.9 million. Its bottom line was hurt by £77.7 million worth of fair value losses, compared to £191.9 million worth of gains a year prior. On an underlying basis, profit surged 25% to £277.6 million.

Paragon Banking shares rose 10% to 541.05 pence each on Wednesday morning in London.

The company highlighted that its total new lending declined to £3.01 billion from £3.21 billion a year ago, though its net loan book grew by 4.7% to £14.9 billion from £14.2 billion. Further, it said that retail deposits jumped 24% to £13.3 billion from £10.7 billion.

‘We have today announced a further £50.0 million share buy-back for the 2024 financial year. Reflecting the sustained performance of the group, strength of our capital ratios and liquidity level, since 2015, the group has returned over £948.5 million to shareholders via share buybacks and dividends,’ Chief Executive Nigel Terrington said.

Paragon lifted its total dividend by 31% to 37.4 pence from 28.6p. It lifted its final dividend by 38% to 26.4p from 19.2p.

Looking ahead, the company noted ‘further progress on delivery of digitalisation strategy, with benefits already available to customers and intermediaries, helping to drive operational efficiencies’.

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