The OSB Group’s dividend policy is to declare interim dividends equal to one-third of the prior year’s total dividend. The Board has therefore declared an interim dividend of 4.9 pence per share for the first half of 2021, based on the 2020 total dividend of 14.5 pence per share.
The declared dividend will be paid on 22 September 2021, with an ex-dividend date of 26 August 2021 and a record date of 27 August 2021.
Other financial highlights include:
- Underlying profit before tax increased 62% to a record £252.8m (H1 2020: £156.3m) and statutory profit before tax more than doubled to £221.9m (H1 2020: £99.3m) driven predominantly by a release of impairment provisions and a lower cost of retail funds
- Underlying and statutory net loan book grew by 6% to £20.3bn and £20.4bn, respectively in the period (FY 2020: £19.0bn and £19.2bn). Organic originations in the first six months of 2021 were £2.5bn, up 16% from £2.1bn in the prior period
- Underlying net interest margin (NIM) of 268bps (H1 2020: 250bps) and statutory NIM of 236bps (H1 2020: 217bps) improved, primarily due to lower cost of retail funds
- Growth in income delivered an improved underlying cost to income ratio of 25% (H1 2020: 26%) and 28% on a statutory basis (H1 2020: 31%)
- Underlying and statutory loan loss ratios improved to -15bps (H1 2020: 60bps and 59bps respectively) as the economy and outlook improved, leading to a provision release. Arrears remained stable with balances greater than three months at 1.3% and 0.5% for OSB and CCFS respectively (31 December 2020: 1.3% and 0.5%)
- Fully-loaded Common Equity Tier 1 capital ratio strengthened to 18.7% (31 December 2020: 18.3%) benefiting from profitability
- Underlying return on equity of 24% (H1 2020: 18%) and statutory return on equity of 19% (H1 2020: 9%) reflecting the increase in profitability partially offset by higher equity
- Underlying basic earnings per share of 41.8p (H1 2020: 26.1p) and statutory basic earnings per share of 35.5p (H1 2020: 15.5p)
