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Pretax profits leap 26% to £129m for Newcastle bank Virgin Money

Releasing its half yearly results this morning, Newcastle bank Virgin Money has enjoyed an excellent six months with pretax profits rising by 26%.

Up from £101.8m in H1 2016, the Richard Branson-founded group revealed an underlying profit before tax increased to £128.6m.

The firm reported widespread growth across customer balances, as retail deposit balances increased to £29.6bn, 5% higher than FY 2016, and mortgage balances increased by 7% to £31.8bn. Moreover, credit card balances increased to £2.8bn, 13% higher than last year.

Jayne-Anne Gadhia, Chief Executive, hailed Virgin’s momentum against the group’s strategy in customer satisfaction.

She said: “Our drive to maintain excellent asset quality, deliver customer satisfaction and retention, combined with continuing operational leverage, helped deliver a 26 per cent increase in underlying profit before tax to £128.6 million.

“In line with our ambition to make ‘everyone better off’, our continued focus on delivering excellent customer service led to new highs in customer satisfaction with our overall Net Promoter Score improving to +39, making us one of the best-rated retail banks in the UK.

“Our deposit franchise is flourishing, we have maintained our stringent focus on the prime segment of the credit card market, and continue to deliver high-quality mortgage lending growth.”

The business also revealed a new partnership with Virgin Atlantic offering enhanced experience for its Flying Club members and progress on its digital capabilities.

Gadhia continued: “With our shared brand and closely aligned values, we expect this to create a valuable strategic partnership for the business.

“The development of our digital banking platform, in collaboration with 10x Future Technologies, is progressing to time and budget and we believe will be transformational for the business.

“We will continue to drive growth, quality and returns, put customers at the heart of everything we do, and we remain on track to sustain a solid double-digit return on tangible equity (RoTE) in 2017.”

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