Challenger Bank Virgin Money has reported record performance with annual profits rocketing 127% during 2014.
On Thursday, the bank, which floated on the stock exchange in November announced that underlying profit before tax jumped to £121.2m over the year.
On an underlying basis, its total income grew by 21% to £438.2m, driven mainly by strong growth in its mortgage business where balances increased to £21.9bn, up 11.8% against market growth of 1.4%. In addition, credit card balances rose 41% to £1.1bn while retail deposit balances edged ahead by 6% to £22.4bn.
Following the market update shares in the business, which is set to join the FTSE 250 index on 20 March, rose by as much as 4% to 331.06p in early trading.
However statutory profit before tax fell dramatically from £185.4m to £34m after its Initial Public Offering transaction fees and additional costs for Northern Rock to HM Treasury, which it bought in 2012, were taken into account.
Commenting on the results chief executive Jayne-Anne Gadhia said: “We have made great progress against our objectives to achieve strong growth, maintain our high quality balance sheet and deliver returns to shareholders. We set out to be a credible and effective challenger to the large incumbent banks and I believe we have laid an excellent foundation on which to realise our ambition.”
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