VMUK Indicating UK Margins Falling Already For Peer Lenders

Virgin Money (VMUKLN: Baa1 pos/BBB- pos/BBB+ pos) 1H24 (6M to Mar-24) trading statement released (ahead of 13-Jun full results) – headlines indicate margins falling already for UK lenders:

*VIRGIN MONEY 1H TRADING IN LINE WITH EXPECTATIONS

*VIRGIN MONEY STILL SEES FY NET INTEREST MARGIN 1.9% TO 1.95%

*VIRGIN MONEY SEES 'DOWNWARD PRESSURE' ON 2H NIM RELATIVE TO 1H

• Guidance: mgmt sees solid (5-10%) lending growth but with NIM lower in the later part of this year, echoing muted guidance given from the peer group with recent 1Q24 results. This is simply confirming a known trend but, as 2H for VMUK is Mar-Sep, this does highlight that margins are likely falling already for UK lenders.
• VMUK is being acquired by NWIDE, shareholder vote is 22-May.