OSB Group posted gross new lending down 14.9% to £4bn last year compared to 12 months ago, as it maintained a “disciplined approach” to pricing new loans.
“The planned reduction in originations was the result of our disciplined approach to pricing new business and prioritising returns, said the firm in an annual statement.
It added: “We chose not to follow as some lenders reduced their new business spreads in certain sub-segments, which led to an improved and attractive blended front book margin for the year.”
The group owns a range of lenders including OneSavings Bank, Kent Reliance and Precise Mortgages.
It pointed out: “The UK mortgage market remained subdued in 2024 although there was some increase in gross mortgage lending, as reductions in the Bank of England base rate and lower Sonia swap rates were reflected in mortgage pricing.”
It highlighted UK Finance data, which said that the balance of outstanding buy-to-let mortgages increased by 1% last year, “reflecting ongoing affordability pressures faced by some amateur landlords”.
During 2024, the group focused on “higher yielding” commercial and residential development finance loans up by around 10% to £446.8m and £189.1m, respectively. Bridging originations rose 5%.
Its loan book fell by 2% to £25.1bn, primarily due to a £1.25bn securitisation of Precise landlord loans in December.
The business said: “Given our focus on returns we anticipate low single-digit loan book growth in 2025 with similar dynamics to those seen in 2024.”
It added that, “over the next two years we will focus on growing across all our segments and in particular increasing origination volumes where yields are strong and sustainable, such as commercial lending, asset finance, development finance and bridging”.
The group posted pre-tax profit up 12% to £418.1m.
OSB Group chief executive Andy Golding said: “The results delivered by OSB Group in 2024 demonstrate the strong fundamentals which underpin our business and also the focused and disciplined strategic choices made in the year by the board and management that will shape the group’s future.”
The firm begins a new share buyback programme of £100m over the next 12 months on 14 March.
Shares lifted 3% to 433p in early trading.
