OSB GROUP PLC – Q3 Trading Update
LEI: 213800ZBKL9BHSL2K459
OSB GROUP PLC: Trading update
Published: 2.11.2023
OSB GROUP PLC
Trading update
OSB GROUP PLC (OSBG or the Group), the specialist lending and
retail savings group, today issues its trading update for the
period from 1 July 2023 to date.
Highlights
- The Group delivered
strong financial and operating performance in the three months to
30 September 2023
- Organic originations
were £1.3bn in the third quarter of 2023 (Q3 2022: £1.6bn)
- Underlying1 and
statutory net loans increased by 7% in the nine months to 30
September 2023 to £25.2bn (31 December 2022: £23.5bn and £23.6bn,
respectively)
- The Group’s three
months plus arrears balances remained broadly stable at 1.3% as at
30 September 2023 (30 June 2023: 1.2%). There was no material
change in the Group’s forward-looking macroeconomic scenarios in
the third quarter
- EIR accounting
assumptions remain broadly consistent, with no material change in
behavioural trends in the period
- The Group has
substantially completed its £150m share repurchase programme2
- The Group
successfully completed an inaugural £300m senior debt issuance, an
important milestone on its journey to meet its interim MREL
requirement of 22.5% (including regulatory buffers) by July 2024,
and supporting further distributions once the capital stack is
optimised fully
- The Group is
cognisant of the rising cost of retail funds and the impact of
planned future MREL issuance, but remains on track to deliver its
2023 full year guidance of an underlying1 net interest margin of
c.2.6% and underlying1 cost to income ratio of c.33%. Given the
strong lending performance to date, particularly in retentions, we
now expect to deliver underlying1 net loan book growth of c.9%
1. Underlying refers to results which exclude exceptional items,
integration costs and other acquisition-related items arising from
the Combination with CCFS
2. As at market close on 1 November 2023
Andy Golding, CEO of OSB GROUP PLC, said:
“I am pleased with the Group’s strong performance in the third
quarter, despite the continued macroeconomic uncertainty. We have
once again proven to be a trusted partner to our borrowers and
savers.
Our customer franchises performed very well. We completed £1.3bn
of new lending during the third quarter demonstrating our strong
relationships and attractive propositions in the market, and we are
seeing borrowers continue to refinance with the Group through our
retention programmes.
Retail deposits increased by 5% in the three months to 30
September as savers continued to choose our consistently fair
products, and we have repaid £250m of the Bank of England’s TFSME
funding using retail deposits.
The credit performance of our borrowers remained strong, with
broadly stable three months plus arrears and no material change in
the Group’s macroeconomic scenarios in the third quarter, albeit we
continue to review these scenarios in light of ongoing uncertainty
in the UK macroeconomic outlook.
I am pleased that the Group successfully issued £300m of MREL
qualifying debt securities in September, as we progress towards our
interim MREL requirement by July 2024. This and further anticipated
issuances of qualifying MREL debt securities support the
optimisation of the Group’s capital composition as well as further
capital returns to shareholders.
The Group is cognisant of the rising cost of retail funds and
the impact of planned future MREL issuance, but remains on track to
deliver its 2023 full year guidance of underlying net interest
margin of c.2.6% and underlying cost to income ratio of c.33%.
Given our strong lending performance to date, particularly in
retentions, we now expect to deliver full year underlying net loan
book growth of c.9%.
Looking ahead, whilst the outlook for the UK economy and the
overall mortgage market remains somewhat unclear, the fundamental
drivers of demand in the private rented sector continue to be
robust. Our strong capital and liquidity position, secured loan
book and proven risk management capabilities, as well as our focus
on professional and portfolio landlords, position us well to
continue to generate attractive and sustainable returns for
shareholders through the cycle.”
Financial calendar for 2024*
14 March 2024 |
2023 year end results |
8 May 2024 |
Q1 trading update |
9 May 2024 |
AGM |
15 August 2024 |
2024 half year results |
6 November 2024 |
Q3 trading update |
* All dates are subject to change
Enquiries:
OSB GROUP PLC
Alastair Pate, Investor
Relations t: 01634
838 973
Brunswick Group
Robin Wrench / Simone
Selzer t: 020 7404
5959
About OSB GROUP PLC
OneSavings Bank plc (OSB) began trading as a bank on 1 February
2011 and was admitted to the main market of the London Stock
Exchange in June 2014 (OSB.L). OSB joined the FTSE 250 index in
June 2015. On 4 October 2019, OSB acquired Charter Court Financial
Services Group plc (CCFS) and its subsidiary businesses. On 30
November 2020, OSB GROUP PLC became the listed entity and holding
company for the OSB Group. The Group provides specialist lending
and retail savings and is authorised by the Prudential Regulation
Authority, part of the Bank of England, and regulated by the
Financial Conduct Authority and Prudential Regulation Authority.
The Group reports under two segments, OneSavings Bank and Charter
Court Financial Services.
OneSavings Bank (OSB)
OSB primarily targets market sub-sectors that offer high growth
potential and attractive risk-adjusted returns in which it can take
a leading position and where it has established expertise,
platforms and capabilities. These include private rented sector
Buy-to-Let, commercial and semi-commercial mortgages, residential
development finance, bespoke and specialist residential lending,
secured funding lines and asset finance.
OSB originates mortgages organically via specialist brokers and
independent financial advisers through its specialist brands
including Kent Reliance for Intermediaries and InterBay Commercial.
It is differentiated through its use of highly skilled, bespoke
underwriting and efficient operating model.
OSB is predominantly funded by retail savings originated through
the long-established Kent Reliance name, which includes online and
postal channels as well as a network of branches in the South East
of England. Diversification of funding is currently provided by
securitisation programmes and the Bank of England’s Term Funding
Scheme with additional incentives for SMEs.
Charter Court Financial Services Group
(CCFS)
CCFS focuses on providing Buy-to-Let and specialist residential
mortgages, mortgage servicing, administration and retail savings
products. It operates through its brands: Precise Mortgages and
Charter Savings Bank.
It is differentiated through risk management expertise and
best-of-breed automated technology and systems, ensuring efficient
processing, strong credit and collateral risk control and speed of
product development and innovation. These factors have enabled
strong balance sheet growth whilst maintaining high credit quality
mortgage assets.
CCFS is predominantly funded by retail savings originated
through its Charter Savings Bank brand. Diversification of funding
is currently provided by securitisation programmes and the Bank of
England’s Term Funding Scheme with additional incentives for
SMEs.
Important disclaimer
This document should be read in conjunction with
any other documents or announcements distributed by OSB GROUP PLC
(OSBG) through the Regulatory News Service (RNS). This document is
not audited and contains certain forward-looking statements with
respect to the business, strategy and plans of OSBG, its current
goals, beliefs, intentions, strategies and expectations relating to
its future financial condition, performance and results. Such
forward-looking statements include, without limitation, those
preceded by, followed by or that include the words ‘targets’,
‘believes’, ‘estimates’, ‘expects’, ‘aims’, ‘intends’, ‘will’,
‘may’, ‘anticipates’, ‘projects’, ‘plans’, ‘forecasts’, ‘outlook’,
‘likely’, ‘guidance’, ‘trends’, ‘future’, ‘would’, ‘could’,
‘should’ or similar expressions or negatives thereof but are not
the exclusive means of identifying such statements. Statements that
are not historical facts, including statements about OSBG’s, its
directors’ and/or management’s beliefs and expectations, are
forward-looking statements. By their nature, forward-looking
statements involve risk and uncertainty because they relate to
events and depend upon circumstances that may or may not occur in
the future that could cause actual results or events to differ
materially from those expressed or implied by the forward-looking
statements. Factors that could cause actual business, strategy,
plans and/or results (including but not limited to the payment of
dividends) to differ materially from the plans, objectives,
expectations, estimates and intentions expressed in such
forward-looking statements made by OSBG or on its behalf include,
but are not limited to: general economic and business conditions in
the UK and internationally; market related trends and developments;
fluctuations in exchange rates, stock markets, inflation,
deflation, interest rates, energy prices and currencies; policies
of the Bank of England, the European Central Bank and other G7
central banks; the ability to access sufficient sources of capital,
liquidity and funding when required; changes to OSBG’s credit
ratings; the ability to derive cost savings; changing demographic
developments, and changing customer behaviour, including consumer
spending, saving and borrowing habits; changes in customer
preferences; changes to borrower or counterparty credit quality;
instability in the global financial markets, including Eurozone
instability, the potential for countries to exit the European Union
(the EU) or the Eurozone, and the impact of any sovereign credit
rating downgrade or other sovereign financial issues; technological
changes and risks to cyber security; natural and other disasters,
adverse weather and similar contingencies outside OSBG’s control;
inadequate or failed internal or external processes, people and
systems; terrorist acts and other acts of war (including, without
limitation, the Russia-Ukraine war, the Israel-Hamas war and any
continuation and escalation of such conflicts) or hostility and
responses to those acts; geopolitical events and diplomatic
tensions; the impact of outbreaks, epidemics and pandemics or other
such events; changes in laws, regulations, taxation, ESG reporting
standards, accounting standards or practices, including as a result
of the UK’s exit from the EU; regulatory capital or liquidity
requirements and similar contingencies outside OSBG’s control; the
policies and actions of governmental or regulatory authorities in
the UK, the EU or elsewhere including the implementation and
interpretation of key legislation and regulation; the ability to
attract and retain senior management and other employees; the
extent of any future impairment charges or write-downs caused by,
but not limited to, depressed asset valuations, market disruptions
and illiquid markets; market relating trends and developments;
exposure to regulatory scrutiny, legal proceedings, regulatory
investigations or complaints; changes in competition and pricing
environments; the inability to hedge certain risks economically;
the adequacy of loss reserves; the actions of competitors,
including non-bank financial services and lending companies; the
success of OSBG in managing the risks of the foregoing; and other
risks inherent to the industries and markets in which OSBG
operates.
Accordingly, no reliance may be placed on any
forward-looking statement. Neither OSBG, nor any of its directors,
officers or employees provides any representation, warranty or
assurance that any of these statements or forecasts will come to
pass or that any forecast results will be achieved. Any
forward-looking statements made in this document speak only as of
the date they are made and it should not be assumed that they have
been revised or updated in the light of new information of future
events. Except as required by the Prudential Regulation Authority,
the Financial Conduct Authority, the London Stock Exchange PLC or
applicable law, OSBG expressly disclaims any obligation or
undertaking to release publicly any updates or revisions to any
forward-looking statements contained in this document to reflect
any change in OSBG’s expectations with regard thereto or any change
in events, conditions or circumstances on which any such statement
is based. For additional information on possible risks to OSBG’s
business, please see the Risk review section in the OSBG Annual
Report and Accounts 2022. Copies of this are available at
www.osb.co.uk and on request from OSBG.
Nothing in this document or any subsequent
discussion of this document constitutes or forms part of a public
offer under any applicable law or an offer or the solicitation of
an offer to purchase or sell any securities or financial
instruments. Nor does it constitute advice or a recommendation with
respect to such securities or financial instruments, or any
invitation or inducement to engage in investment activity under
section 21 of the Financial Services and Markets Act 2000. Past
performance cannot be relied on as a guide to future performance.
Statements about historical performance must not be construed to
indicate that future performance, share price or results in any
future period will necessarily match or exceed those of any prior
period. Nothing in this document is intended to be, or should be
construed as, a profit forecast or estimate for any period.
In regard to any information provided by third
parties, neither OSBG nor any of its directors, officers or
employees explicitly or implicitly guarantees that such information
is exact, up to date, accurate, comprehensive or complete. In no
event shall OSBG be liable for any use by any party of, for any
decision made or action taken by any party in reliance upon, or for
inaccuracies or errors in, or omission from, any third-party
information contained herein. Moreover, in reproducing such
information by any means, OSBG may introduce any changes it deems
suitable, may omit partially or completely any aspect of the
information from this document, and accepts no liability whatsoever
for any resulting discrepancy.
Liability arising from anything in this document
shall be governed by English law, and neither OSBG nor any of its
affiliates, advisors or representatives shall have any liability
whatsoever (in negligence or otherwise) for any loss howsoever
arising from any use of this document or its contents or otherwise
arising in connection with this document. Nothing in this document
shall exclude any liability under applicable laws that cannot be
excluded in accordance with such laws.
Certain figures contained in this document,
including financial information, may have been subject to rounding
adjustments and foreign exchange conversions. Accordingly, in
certain instances, the sum or percentage change of the numbers
contained in this document may not conform exactly to the total
figure given.
Non-IFRS performance measures
OSB believes that any non-IFRS performance measures included in
this document provide a more consistent basis for comparing the
business' performance between financial periods and provide more
detail concerning the elements of performance which OSBG is most
directly able to influence or which are relevant for an assessment
of OSBG. They also reflect an important aspect of the way in which
operating targets are defined and performance is monitored by the
Board. However, any non-IFRS performance measures in this document
are not a substitute for IFRS measures and readers should consider
the IFRS measures as well. For further details, refer to the
Alternative performance measures section in the OSBG Annual Report
and Accounts 2022. Copies of this are available at www.osb.co.uk
and on request from OSBG.
Osb (LSE:OSB)
Gráfico Histórico do Ativo
De Mai 2024 até Jun 2024
Osb (LSE:OSB)
Gráfico Histórico do Ativo
De Jun 2023 até Jun 2024