The increase in deposits is due to Covid-19 restrictions, reduced personal customer spending and businesses maintaining more liquidity
Virgin Money UK has reported customer deposits of £68.1bn for the first quarter (Q1) 2021, a 0.9% increase compared to the same quarter in the previous year.
The firm’s mortgages for the Q1 2021 reduced by 0.2% to £58.2bn, as it focused on margin management and prudent underwriting standards.
The company reported business lending of £8.9bn for Q1 2021, a 0.1% increase compared to the corresponding quarter in 2020.
The financial services firm reported personal lending of £5.1bn for the Q1 2021, which decreased by 2% than the same period in the previous year.
Virgin Money UK attributed the rise in deposits to Covid-19 restrictions, reduced personal customer spending and businesses maintaining more liquidity.
Virgin Money UK chief executive officer David Duffy said: “We have made a good start to the year with the launch of new customer propositions, further roll-out of our rebrand programme and a return to statutory profit, while maintaining a disciplined approach.
“The Group remains strongly capitalised and we have good momentum as we look out into the remainder of the year.
The company said that it would continue its support to mortgage and personal customers during the pandemic, through payment holidays (PHs) wherever required.
Also, it has increased the proportion of customers requiring further support on exiting their payment holiday, and anticipates the proportion remain within the assumed level.
Furthermore, the company said that it is cautiously positioned for the economic environment further affected by the pandemic, with £726m of average credit provisions.
Duffy added: Given the current UK-wide restrictions and ongoing uncertainty, we maintain the cautious economic outlook we outlined in November and our full-year guidance remains broadly unchanged.
“Looking ahead, the vaccine roll-out and EU trade deal are encouraging for the UK’s economic recovery and we remain focused on disrupting the market through a variety of innovative new products and propositions with a customer and brand experience that is the best in the market.”