LendInvest results for the first half of the fiscal year ending 30th September 2023 show that the mortgage lender experienced a first-half loss of £15.1m, a notable decrease from the £14.8m profit reported in the same period last year.
This downturn was primarily attributed to a 28% decline in new lending, which totalled £415.2m, down from the previous year.
LendInvest cited market volatility and restricted funding availability during the period for new lending in the capital division as key reasons for this reduction.
The company’s net interest income, which represents the difference between interest payments received and paid out, was £17.7m lower than the previous year. This decrease was due to persistently higher interest rates, which have become a burden for the firm.
LendInvest also faced rising impairments, which increased to £7.1m, compared with £1.9m in the previous year. Impairment charges are indicative of falls in the value of a lender’s assets.
To address margin pressures, LendInvest has planned to reduce its headcount by over 27%, aiming to save around £5m per year on payroll costs. This decision aligns with the company’s broader strategy to streamline costs and improve profitability.
Rod Lockhart, chief executive of LendInvest, said: “After a challenging first half, management is focused on accelerating new lending and returning the business to profitability.
“The core strengths of our business remain strong and we’re beginning to see encouraging signs of improvement in the broader market landscape.
“Combined with the tough but necessary measures we’ve implemented to streamline costs; these factors are positioning us well to return to profitability in the 2025 financial year.”
