Vida Group Holdings, the specialist mortgage lender which secured its full banking licence late last year, has reported a sharp increase in profits and lending volumes for the first half of 2025 as retail deposits transformed its funding base and lowered borrowing costs.
The group posted profit before tax of £10.7 million for the six months to June, up from £1.9 million a year earlier and almost triple its full-year 2024 profit of £3.6 million. Operating income rose to £30.8 million from £18.6 million, while the cost-to-income ratio improved to 63% from 91%.
Gross mortgage lending more than doubled to £348 million, compared with £165 million in the same period last year, alongside a further £128 million in retention lending. Vida’s net interest margin strengthened to 2.13%, from 1.73% in H1 2024, reflecting lower funding costs and disciplined pricing.
Retail deposit inflows of £1.1 billion in the first half of the year have significantly reshaped the group’s funding model, cutting wholesale liabilities to £1.2 billion from £1.9 billion at the end of 2024 and reducing asset encumbrance to 49%.
CREDIT QUALITY
The average cost of funds has fallen to 1.05% above SONIA, compared with 1.46% last year. Liquidity remains strong, with a coverage ratio of 218%, while credit quality was broadly stable with loans over 90 days in arrears at 2.3%.
The group also completed a £250 million securitisation, London Bridge Mortgages 2025-1, in the period – a move that boosted capital flexibility and balance sheet strength. Total capital and CET1 ratios improved to 17.1%, up from 16.2% at year-end.
DIVERSIFIED FUNDING BASE
Chief executive Anth Mooney (main picture, inset) said the business had seen strong demand from brokers and borrowers, supported by its transition to a full banking model.
He added: “This was a strong first half for Vida, reflecting the benefits of our new banking licence, a more diversified funding base, and continued operational discipline. Retail deposits have transformed our balance sheet and materially reduced our cost of funds, supporting profitable mortgage growth.”
“We have continued to see strong demand for our mortgage products from brokers and customers.”
And he said: “With mortgage applications of over £2 billion year to date and a current pipeline of £600 million, we have continued to see strong demand for our mortgage products from brokers and customers.
“We’ve seen record demand in September and expect a strong finish to the year as momentum continues. Our strategy of disciplined growth is delivering results, and we are well positioned to build on this success in 2026.”
The board said it expects continued growth in deposits and lending volumes through the second half of the year, alongside further investment in technology and digital delivery to improve efficiency and maintain capital resilience.
