Stockbroker Arden Partners has told investors that buy-to-let specialist Paragon could be “weeks away” from a return to new lending.
Last week, Arden said Paragon is in a position to restart new lending due to a marked imp-rovement in the securitisation market although Paragon itself will not be drawn on timescales. Arden expects the lender to make the announcement of a return around the time of its first-half results on May 18.
Arden says: “Resumption of new lending is weeks away. The securitisation market has imp-roved significantly. Paragon is positioned to enable new lending to recommence.”
The stockbroker also says it expects the resumption of lending to result in a £300m special purpose vehicle, which it expects to generate returns of 0.84 per cent on the new lending.
A Paragon spokesman says: “What we have said previously is that we have been encouraged by what has happened in the wholesale funding markets. We have never made any secret of our intention to get back into new lending but we have never put any timescales on it.”
Mortgages for Business managing director David Whittaker says: “There has been much speculation that Paragon would soon return following their ann-ouncement in their results last year that it would be looking for opportunities to re-enter the market.
“Given that their half-year results are due out May 18, you would expect either a launch at that time or a very firm commitment to do so.”
Paragon ceased new lending in February 2008 when it failed to secure commercially acceptable terms to extend the loan facility used to fund lending.