Paragon launches new bank
Paragon has been granted a banking licence by the Regulator and launches its new division today
Paragon has been granted a banking licence by the Regulator and launches its new division today.
The new bank, part of Paragon Mortgages’ parent company Paragon Group, has been granted the banking licence by the Prudential Regulation Authority.
The new bank has been provided with an initial £12.7 million to lend and will focus on providing straightforward and competitive savings and loan products, broadening competition and choice in the UK banking market. Further capital is to be provided to support its growth.
Paragon Bank will be led by Managing Director, Richard Doe, who was previously Chief Executive of ING Direct UK. He is joined by an experienced banking and consumer finance management team and Board of Directors.
Benefitting from the Group’s strong heritage as a specialist mortgage and consumer finance lender, Paragon Bank will bring choice and competition to UK consumers.
Solihull-based Paragon Bank will employ market leading technology to deliver lending products through established intermediary channels and via the growing use of the internet for its savings products.
Paragon Bank will operate in specialist lending markets. Its initial product range will be car finance loans available via brokers and car dealers.
In late Spring Paragon Bank will also deliver a choice of online, competitively-priced savings products direct to consumers, launching with easy access and fixed rate savings accounts.
Personal loans will be offered through intermediaries and will launch later in the year. Other consumer finance and SME products will be developed in due course.
John Heron, Managing Director of Paragon Mortgages, said: “This is a significant strategic step for the Group. Paragon Bank provides further expansion and diversification of our funding capability which in turn will facilitate the diversification of our lending. This will see the Group returning to sectors where it has previously been a major competitor – car finance and personal loans – and will provide a spring-board for greater innovation going forward.”
Group Chief Executive Nigel Terrington said: "Today's launch of Paragon Bank marks an exciting development for the Group and represents the third leg of the strategy, joining Paragon Mortgages, the buy-to-let lending business and Idem Capital, the debt purchase business. The establishment of Paragon Bank facilitates a return to consumer finance lending, benefitting from the Group's heritage, expertise and scale as a low-cost specialist lender.
"Paragon Bank will bring choice and customer focus to the UK banking market, by providing consumers with straightforward, competitive products that are transparent, easy to understand and manage. Initially, Paragon Bank will focus on lending in sectors where Paragon has extensive experience and previous success, in markets which are displaying good growth opportunities. Paragon Bank's aim is to establish itself as a trusted banking partner for its customers and business partners."
Back in 2012, Paragon was in exclusive talks over the acquisition of bridging lender Hampshire Trust. However, Paragon decided to pursue its own banking licence. Over the years Paragon has also bought several home loan portfolios from larger lenders, including £43.2 million of debt obtained from Royal Bank of Scotland.
Keywords: Paragon, new bank, John Heron, Managing Director, Nigel Terrington, Cheif Executive, Paragon Bank, Paragon Group, Regulator, Prudential Regulation Authority, Richard Doe, Managing Director
Source: Bridging & Commercial — https://bridgingandcommercial.co.uk/paragon-launches-new-bank