Editor's note: This brief was summarised by The Property AI Newsroom from a report by Mortgage Solutions. Read the original article for full details.
Paragon’s Lending Rises as Commercial Business Leads
Paragon Banking Group increased its gross lending by 4.3% year-on-year to £2.06bn in the nine months to 30 June 2026, according to a report by Mortgage Solutions. The growth was primarily driven by a stronger performance in Paragon’s commercial lending division, which outpaced its mortgage business.
Aggregate new advances across Paragon’s mortgage and commercial lending businesses reached £2.06bn, up from £1.98bn in the same period last year. Mortgage lending rose by 1.2% to £1.12bn, compared to £1.11bn a year earlier. The mortgage pipeline stood at £620m at the end of June.
Buy-to-let (BTL) demand was sensitive to interest rate movements during April and May but recovered in June. Customer retention in BTL remained strong, with an annualised redemption rate of 8.1%. BTL arrears fell by 10 basis points to 40 basis points at the end of June.
Commercial lending saw stronger growth, with new business increasing by 8.2% year-on-year to £940m, up from £870m. Paragon reported that demand was subdued in April and May due to geopolitical and economic uncertainty but rebounded strongly in June, leaving a commercial lending pipeline of £610m at the period end.
Paragon highlighted the arrival of two new teams: one focused on broadening SME lending and another developing a bridging finance proposition. Limited distribution of the bridging product is expected to begin in the first quarter of the new financial year. The bank also reported that development finance arrears continued to decline.
Paragon completed the disposal of its SFS business on 10 July, which the bank said further enhanced its capital position and simplified its operational model.
These developments may be of interest to UK letting agents and inventory clerks monitoring trends in buy-to-let lending, arrears, and commercial property finance.
Source: Mortgage Solutions