New lending activity for Paragon’s asset finance arm grew by 40%, totalling £220m (€247m) in 2017.
The average yield on contracts decreased slightly, from 11.78% to 9.35%, which Paragon attributed to a focus on “the larger, higher quality but lower yielding mid-range segment of the market”.
The average balance for asset finance throughout the 12 months was £311.1m, 25% more than the previous year.
The group also reported a £12.9m investment in new assets to be leased, up 48% from 2016. It stated its strategy had been to target asset niches such as “waste collection vehicles for local authorities, construction equipment and complex veterinary equipment”.
Paragon said Premier Asset Finance, which was acquired in October 2016 and provided the group with in-house brokerage, had “proved valuable as a source of new business, particularly in the business finance area.” In late 2015, Paragon had also acquired Five Arrows Leasing.
Overall profits for Paragons’ commercial lending division, which includes asset, motor and development finance, totalled £14.1m, up 56% from 2016.
Gary Leitch, managing director of asset finance at Paragon, said: “This year’s results demonstrate our appetite to grow the business through a focused strategy designed to strengthen our relationships with the broker community, extend our specialist sector expertise into new areas of the market and enhance our service capability with targeted investment in key systems.”
“Customers are already well advanced in their planning for 2018 and we see good opportunities to offer our specialist finance support to help them achieve their objectives and steer a path through the economic uncertainty ahead.”