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Strong capitalisation provides the foundation for solid growth in 2015 (Unaudited full year 2015 results)

08 November 2016

Charter Court Financial Services (“Charter Court”), the specialist challenger bank and owner of Precise Mortgages and Charter Savings Bank, recorded a strong financial and operational performance in 2015.


  • Mortgage balance sheet up 126% to £1.95 billion
  • New mortgage originations up 120% to £1.61 billion
  • Net interest income up 190% to £45 million at Net Interest Margin of 2.53%
  • Profit before tax of £27 million (2014: £1 million loss)
  • Profit after tax of £21 million (2014: £2 million)
  • Cost income ratio halved to 55% (2014: 107%) driven by lending growth and increasing operating leverage
  • Exceptional asset quality with a three months-plus arrears rate of just 0.05% and low cost of risk at 2.7bps
  • Customer deposits of £1.56 billion with more than 36,000 savings accounts opened from March 2015 to December 2015
  • Common Equity Tier 1 Ratio of 21%

arrears rate based on mortgages as at month end December 2015.
CML mortgages >3 months in arrears at end of Q2 2015.

Ian Lonergan, CEO of Charter Court, said:

“Charter Court performed strongly in 2015. Our focus on capital strength and liquidity provided the foundation for our solid growth and enabled us to continue to build a strong presence and reputation in our chosen property lending markets. We are strongly capitalised and continue to generate capital organically. We delivered solid lending growth during the year, increased profitability and exceptional operational efficiency. New mortgage originations increased to £1.61 billion in 2015, a level similar to those of our listed specialist challenger bank peers. This top line growth translated into significantly increased profits, reflecting the downward trajectory of our cost income ratio as the benefits from the inherent efficiency and scalability of our highly efficient, purpose-built operating platform started to flow through.

“Our sophisticated risk management systems embedded across all aspects of our business continued to underpin the exceptional quality of our assets. This resulted in a Cost of Risk of just 2.7 bps and just six mortgage loans standing three or more monthly payments in arrears at year end, equating to an arrears rate of just 0.05% compared to the CML mortgage industry average arrears rate of 1.19% . Buy-to-let (BTL) lending represented the largest asset class, accounting for approximately 62% of our total long term lending in 2015, with the remaining 38% comprising residential home owners.

“The successful launch of Charter Savings Bank in March 2015 following the award of our banking license in January 2015 exceeded our expectations, attracting £1.56 billion in deposits in its first nine months of operation to year end. Our success was driven by offering straightforward, transparent savings products at great rates which have consistently featured in the consumer best buy tables. The growth and scale of our deposit base has provided significant flexibility, funding the majority of our mortgage book at year end.

“Looking ahead, the business is off to a strong start in 2016 on both the deposit taking and lending side and I am confident we will continue to deliver strong asset growth and drive accelerating profitability while continuing to maintain robust capital ratios”

Key financial results, ratios and metrics

Key balance sheet data (£m) 2015 2014
Mortgage balance sheet 1,945 859
Mortgage originations 1,610 731
Retail deposits 1,562 n/a
Total assets 2,605 908
CET1 capital 141 n/a
Key income statement data (£m) 2015 2014
Net interest income 44.9 15.5
Total income 60.5 18.8
Profit / Loss before tax 27.2 -1.4
Profit / Loss after tax 21.4 2.0

About Charter Court Financial Services Limited (Charter Court)

Charter Court is one of the UK’s leading specialist challenger banks, founded in 2008 by its senior management team and purpose built to focus on specialist BTL, residential, bridging and second mortgage lending. We operate through our three highly rated brands – Precise Mortgages, Exact Mortgage Experts and Charter Savings Bank – providing buy-to-let and specialist residential mortgages; mortgage servicing, administration and credit consultancy; and retail savings products. Our focus on strong capitalisation and access to liquidity provides the foundation for our growth strategy. At 31 December 2015 our total mortgage balance sheet stood at £1.95 billion generated through our relationships with more than 16,000 intermediaries nationwide, while Charter Savings Bank had attracted £1.56 billion in retail deposits from its launch in March 2015 to 31 December 2015. Underpinning our success, our risk management expertise and best-of-breed automated technology and systems ensure efficient processing, strong credit and collateral risk control and speed of product development and innovation. These factors have enabled our strong balance sheet growth and the exceptional credit quality of our mortgage assets. Charter Court is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority.

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Wolverhampton Firm Tops Sunday Times List

01 March 2016

Charter Court Financial Services (CCFS) which is based in Wolverhampton has been ranked tenth in The Sunday Times Best 100 Companies to Work For 2016.

The firm employs over 350 people at its headquarters in Wolverhampton Business Park and owns Charter Savings Bank, one of the UK’s leading challenger banks with over 40,000 savings accounts and balances in excess of £1.7billion since its launch in March 2015.

Over the past eight years CCFS has experienced unprecedented growth, and is a significant employer in the area. Since 2008 the workforce has grown from just 20 employees to 362.

Ian Lonergan, CEO of CCFS commented: “With the launch of Charter Savings Bank and developments in our mortgage business, the business has trebled in size in under two years. But we don’t want this growth to change how we do business or alter our friendly work environment. We have a fantastic team and we always look for ways to make work a more positive and rewarding experience for them so it’s great to have our efforts recognised by our employees and The Sunday Times. We are always on the lookout for more talented people to join our team and this award will undoubtedly help us achieve that in the future.”

The Sunday Times Best Companies to Work is a highly prestigious award which champions the importance of maintaining a happy and motivated workforce in successful high growth businesses.

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High Street banks – the modern day mattress for UK savers

02 December 2015

• More than an eighth (13%) of UK adults with savings are earning below 0.5% interest on their main savings account

• Average UK savings pot totals £8,500, equating to average annual interest of just £43 a year before tax, savers could earn four times as much with a challenger bank

New research from challenger bank, Charter Savings Bank, conducted in conjunction with YouGov, has found that more than an eighth (13%) of UK adults with savings are earning below 0.5% interest on their primary savings account, which is less than the base rate set by the Bank of England. The research shows that as a result of historically low interest rates, combined with poor High Street offerings, the average UK savings pot, now £8,500, could earn just £43 a year of annual interest.

These ‘modern day mattress savers’ are earning only slightly more in interest than the 174,000 UK adults who keep their savings in an unsecured place, such as under real mattresses or in shoe boxes. To give an idea of the scale, the Bank of England recently estimated that the UK homes have £3billion of cash stashed away.

The research also reveals that whilst saving is a habit for the UK, many are simply not engaging with their hard-earned money: nearly a third (32%) of UK adults with savings admitted they do not know the current rate of interest on their main savings account, while a fifth (17%) admit to having never checked the rate on their primary savings account.

Paul Whitlock, Director of Savings at Charter Savings Bank, said: “High street banks are offering little more to the UK than a secure mattress for their savings, and with news that more than 400,000 NS&I savers will see interest rates on their Isas cut, it’s no surprise UK savers have themselves lost interest in their savings. People are simply not aware of how much harder their money could be working for them and so have become apathetic to taking their money from under their mattress, or from out of their High Street bank.”

“Whilst it is encouraging to see that saving has become a habit for so many of us, more needs to be done to ensure consumers know there are ways they can make their savings go further. The low interest rate environment over the last six years has opened up the opportunity for challenger banks – such as Charter Savings Bank, One Savings Bank, Aldermore and Shawbrook Bank – to offer the only viable alternative for savers’ money. Currently, challenger banks dominate the best buy tables and pay interest rates that top 2%. With this in mind, some savers could be earning more than four times as much interest as they currently do.

“Since Charter Savings Bank was launched in February, 32,000 savers have already deposited over £1.5 billion with us in just the first nine months of operation. Eligible deposits with these challenger banks are protected up to a total of £75,000 by the Financial Services Compensation Scheme, the UK's deposit protection scheme. More must be done to incentivise savers to seek the best possible return on their money, especially with the prospect of a base rate staying at a historic low well into 2017.”

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Charter Court mortgage lending passes £2.5billion

04 November 2015

• Over 14,500 loans completed in buy-to-let, residential and bridging to date

• Exceptional asset quality

• New mortgage lending forecast at £1.5 billion for 2015, up 114% on 2014

• Over 32,000 savings accounts opened at Charter Savings Bank in just 8 months since launch

• Savings customers have deposited £1.4 billion

Charter Court Financial Services Limited (Charter Court), the specialist challenger bank and owner of Precise Mortgages and Charter Savings Bank, today announces it passed through £2.5 billion of mortgage completions to the end of October 2015, helping over 14,500 buy to let landlords and home owners achieve their property ambitions.

New mortgage lending in 2015 is forecast to grow to c£1.5 billion, an increase of 114% vs. 2014. This has been driven by strong growth in core lending markets, competitive product rates and the current mix of stable economic conditions, rising real incomes, improving housing equity positions, and modest expectations of interest rate increases. Buy-to-let lending represents the largest sector, accounting for approximately 62% of Charter Court’s total lending. The remaining 38% of lending includes residential home owners, many of whom – such as the self-employed – are not well served by high street lenders.

Charter Court has just eight mortgage loans where there are three or more payments in arrears – this equates to an arrears rate of 0.07%*, and reflects strong lending controls and underwriting criteria. The CML mortgage industry average arrears rate is 1.19%**.

Charter Savings Bank, which has regularly been featured in the best buy tables since it opened for business in March 2015, has already opened over 32,000 savings accounts, in which customers have deposited £1.4 billion.

Ian Lonergan, CEO of Charter Court Financial Services Limited said: “Passing £2.5bn in cumulative lending and attracting £1.4bn of savings balances is a major milestone for the business. Along with other challenger banks of a similar scale, we are bringing a new level of choice and service to customers who are disillusioned with high street banks. Our loan performance and service levels remain very strong due to the investment the business has made in excellent people and a scalable infrastructure.”

*arrears rate based on mortgages as at month end September 2015.

** CML mortgages >3 months in arrears at end of Q2 2015.

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Buy to let boom

03 November 2015
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