LONDON (ShareCast) - (Sharecast News) - OneSavings Bank lifted its loan growth guidance on Thursday as it reported a "strong" performance for the third quarter.
The FTSE 250 challenger bank posted loan book growth of 16% for the nine months to 30 September, with net loans and advances up by £1.18bn to £8.5bn during the period.

Meanwhile, organic originations came in at £730m in the three-month period, compared to £677m in the same period a year ago.

In addition, the company said it now expects net loan book growth of around 20% for full-year 2018 versus previous guidance of high teens.This is the third time this year that the bank has upgraded its loan growth guidance, having kicked off 2017 with an expectation of mid-teens loan growth.

Other full-year guidance remained the same, with net interest margin of around 3% and cost to income ratio of 30%.

Chief executive officer Andy Golding said: "Our lending and retail savings franchises continue to perform very well. Current levels of applications in our core Buy-to-Let and commercial businesses remain strong and we are building a robust pipeline for Q1 2019.

"We recognise the current uncertain macroeconomic outlook. However, our strong balance sheet with sensible LTVs and affordability testing, our strong capital position and robust stress tests, which include a number of Brexit scenarios, give us confidence in our business going forward."

Shore Capital analyst Gary Greenwood said: "OneSavings Bank has been a relative beneficiary of recent regulatory changes in the buy-to-let industry, reflecting a market share shift towards underwriters of loans to professional landlords, which has allowed the group to maintain strong lending growth momentum despite operating in a market that has been under pressure overall.

"This, combined with an efficient operating model afforded by having low cost administration in India, means the group is well positioned to continue delivering growth at attractive returns, in our view." He rates the stock at 'buy'.

At 0915 GMT, the shares were up 3.7% to 390.80p.

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