Virgin Bank slaps restrictive conditions on its mortgages
Virgin Bank, which entered the high street lending market earlier this year, has slapped a prohibitive 70 per cent loan-to-value maximum on customers looking to take out a mortgage.
The bank, which bought the small Somerset-based Church House Trust group for £12m in January, is believed to have taken one of the most conservative stances on the high street. It's thought that the bank has advanced a "relatively tiny" amount of mortgages due to the mortgage parameters imposed.
"Virgin burst on to the scene promising lots, but it has done very little," said a banking source.
The group, which has promised to plough around £40m into the Church House infrastructure, is also thought to be very cautious about lending on new build properties, too.
Last month Virgin was forced to pull out of the bidding for 300 Williams & Glyn's bank branches, which were being sold by the Royal Bank of Scotland.
Despite enlisting the backing of the US billionaire, Wilbur Ross, Virgin has lost out in the process to Santander, which is expected to pay around £1.8bn for the network.