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Virgin in the money thanks to its mortgage dealings

By Roger Baird

Virgin Money saw its profits jump in the first six months of the year as the lender boosted its share of the mortgage market.

The Newcastle-based group said its underlying profits beat City expectations, leaping by 37% to £81.8m in the half year to the end of June.

The increase was driven by its new mortgage business, which lifted by almost half compared with a year ago.

It said its mortgage lending surged 44% to £1.7bn, taking its total mortgage book to £23.6bn, up 8% on the calendar year.

The lender said while the mortgage market was "very competitive during the first half of the year", the size of its mortgage book now represents a 20.5% share of the UK's net lending market to the end of May.

Shares in the group, which floated last November, rose 12%.

Virgin Money also joined fellow challenger bank TSB in warning over the impact of Chancellor George Osborne's new 8% surcharge on bank profits above £25m, announced in the summer budget.

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