The Paragon Group of Companies has announces a strategic reorganisation as part of its plan to become a diversified specialist banking institution.

It follows PRA and FCA approval and means that all the group’s lending and operating activities, together with the majority of its loan portfolio, now sits within Paragon Bank in the group structure.

These actions reflect the group’s strategy to source the majority of its funding from the retail deposit market going forward.

As part of the reorganisation, the group also intends to change its name to Paragon Banking Group PLC. This reflects the changing focus towards the group becoming a fully integrated banking business and it will enable the group to begin simplifying its branding.

The group says this will include realigning Paragon’s mortgage products under the refreshed brand.

John Heron (pictured), who will continue to lead the group’s mortgage business as managing director – mortgages and as an executive director at Paragon, said: “This is an important milestone and a positive development for our customers and intermediaries. By bringing more of our business into the banking framework, we can use our capital more efficiently and simplify our operating structure enabling us to offer better products, more competitive pricing and better service going forward.”