Tesco Bank grew its mortgage balance sheet by nearly 18 per cent in the first half of the year as it continued to expand into the intermediary market.
The lender’s half-year report reveals mortgage balances rose from £2.2bn in February to £2.5bn in August – a 17.9 per cent increase, which came amid an 8 per cent rise in loans and advances.
Pre-tax profits were up by 144 per cent to £112.2m. Payment protection insurance charges of £45m and restructuring charges of £21.8m had made a hit in the previous period.
But the group saw a 4 per cent drop in underlying profit before tax, to £110.7m.
Tesco Bank launched its mortgages division in 2012 and entered the intermediary market in 2016.
In January this year, it expanded its broker panel to include the First Complete and Pink networks, and now works with more than 4,400 registered advisers.
The lender currently offers two-year fixed rates from 1.42 per cent and five-year fixes from 1.78 per cent, both at 60 per cent loan-to-value.
Andrew Montlake, director at London-based Coreco Group, commented: “What Tesco have done is offered a very slick system that makes the processing of a mortgage quick and easy for a broker. They have done that well.
“They have got some good rates, but they are a very vanilla lender, which might have held them back a little bit. I would like to see them be a bit more creative with criteria, but other than that they are a welcome addition to a range of options.”
simon.allin@ft.com
