REG - Shawbrook Group PLC - Shawbrook Q1 2026 Trading Update

ShawbrookAnnouncement

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RNS Number : 2372E  Shawbrook Group PLC  14 May 2026

 

 Shawbrook Group plc - Q1 2026 Trading Update
 Shawbrook Group plc ('Shawbrook' or the 'Group') today issues its trading
 update for the three months ended 31 March 2026 ('Q1 2026') alongside guidance
 for FY26.

 Q1 2026 highlights
                               31-Mar-2026  31-Dec-2025  Change

 Loan book (including OTD)(1)  19.7bn       19.2bn       +2.6%
 Customer deposits             18.7bn       18.4bn       +1.8%
 CET1 ratio %                  12.6         12.4         +0.2%
 Total capital ratio %         14.9         14.8         +0.1%
 3-month-plus arrears %        1.7          1.6          +0.1%

 Marcelino Castrillo, Chief Executive Officer, commented:

"Q1 2026 has delivered tangible progress against the strategic priorities we
 set out at the full year. Financial performance was strong in the first
 quarter, driven by continued growth and cost discipline. The loan book grew
 2.6% in the quarter to £19.7 billion, with cost of deposits reducing to
 3.71%. Asset quality remained robust and we strengthened our capital position
 by issuing £250 million of AT1 securities in April 2026.

 We see attractive opportunities for growth within the specialist markets we
 serve, underpinned by a TAM of c.£300bn. Our proven specialist model and
 disciplined underwriting allow us to capture those opportunities, while
 remaining alert to the macroeconomic backdrop.

 Our confidence underpins the FY26 guidance we are setting out today, as well
 as reiterating our medium-term guidance."

 FY26 guidance
 We set out FY26 guidance below and reiterate the Group's medium-term
 guidance(2).
 Metric                                FY26 guidance

 Loan book (including OTD)             c.£21 billion
 Cost to income ratio                  <38%
 CET1 ratio                            >13.2% (pre-Basel 3.1)(3)
 Underlying return on tangible equity  c.17%
 Dividend policy                       Maiden ordinary dividend in respect of FY26 results, payable in FY27

 Strategic progress
 •    Loan book (including OTD) increased to £19.7 billion (31 December 2025:
      £19.2 billion), supported by selective originations across our specialist
      segments and continued execution of our originate-to-distribute strategy.
 •    Deposit balances increased to £18.7 billion (31 December 2025: £18.4
      billion), with the stock cost of deposits reducing to 3.71% (FY 2025: 3.88%)
      and the cost of new retail funding aligned to our expectations.
 •    Asset quality remained robust; 3-month-plus arrears(4) were 1.7% (FY 2025:
      1.6%), within management expectations.
 •    CET1 ratio increased to 12.6% (31 December 2025: 12.4%)(5). Capital generation
      in the quarter was in line with expectations and consistent with our
      trajectory toward the FY26 guidance range of >13.2% pre-Basel 3.1,
      reflecting the typical first-quarter step-up in operational risk-weighted
      assets.
 •    Total capital ratio and AT1 issuance. In April 2026, we completed the issuance
      of a £250 million AT1 instrument in conjunction with a tender offer of the
      Group's existing £124 million AT1 securities. This increases the Group's
      total capital ratio from 14.9% to 16.0%, had the AT1 issue taken place as at
      31 March 2026.
 •    Originate-to-distribute. We disposed of our residual interest in the £510
      million Lanebrook Mortgage Transaction 2024-1 as part of our OTD strategy.
 •    ThinCats update. Following the Group's acquisition of ThinCats in Q4 2025, we
      completed the purchase of a c.£160 million loan portfolio, originated and
      serviced by ThinCats, further building scale in our targeted SME segment.

 Footnotes:
 1.   As at 31 March 2026, the Group's OTD balances increased to £1.8 billion,
      resulting in a loan book of £17.9 billion (December 2025: £17.8 billion).
 2.   Medium-term guidance: Loan book growth of low double digits (based on a CAGR
      from FY24); Cost to income ratio of mid 30s; Underlying profit before tax
      growth of mid-high teens; Underlying return on tangible equity of high-teens;
      Maiden ordinary dividend in respect of FY26 results and a CET1 ratio of
      12-13%.
 3.   The CET1 ratio guidance includes the foreseeable dividend expected to be paid
      in 2027.
 4.   The Group calculates its arrears measure by including all accounts that are
      greater than 3 contractual payments down at month end but excluding loans that
      are term expired. This is then divided by the total loan book, excluding term
      expired loans. ABL and Development Finance loans are excluded from the arrears
      measure given there is no concept of arrears in these products. Purchased or
      Originated Credit-Impaired loans are also excluded.
 5.   Includes Bank of England levy of £2.6 million (Q1 2025: £2.5 million) and
      operational risk RWAs of £1,174 million (31 December 2025: £1,046 million),
      reflecting the annual recalibration of operational risk capital requirements
      effective 1 January 2026, equivalent to c.13bps of CET1. Total RWAs as at 31
      March 2026 were £12,331 million (31 December 2025: £12,003 million).

Marcelino Castrillo, Chief Executive Officer, commented:

"Q1 2026 has delivered tangible progress against the strategic priorities we
set out at the full year. Financial performance was strong in the first
quarter, driven by continued growth and cost discipline. The loan book grew
2.6% in the quarter to £19.7 billion, with cost of deposits reducing to
3.71%. Asset quality remained robust and we strengthened our capital position
by issuing £250 million of AT1 securities in April 2026.

 

We see attractive opportunities for growth within the specialist markets we
serve, underpinned by a TAM of c.£300bn. Our proven specialist model and
disciplined underwriting allow us to capture those opportunities, while
remaining alert to the macroeconomic backdrop.

 

Our confidence underpins the FY26 guidance we are setting out today, as well
as reiterating our medium-term guidance."

 

FY26 guidance

We set out FY26 guidance below and reiterate the Group's medium-term
guidance(2).

 Metric                                FY26 guidance

 Loan book (including OTD)             c.£21 billion
 Cost to income ratio                  <38%
 CET1 ratio                            >13.2% (pre-Basel 3.1)(3)
 Underlying return on tangible equity  c.17%
 Dividend policy                       Maiden ordinary dividend in respect of FY26 results, payable in FY27

 

Strategic progress

•

Loan book (including OTD) increased to £19.7 billion (31 December 2025:
£19.2 billion), supported by selective originations across our specialist
segments and continued execution of our originate-to-distribute strategy.

•

Deposit balances increased to £18.7 billion (31 December 2025: £18.4
billion), with the stock cost of deposits reducing to 3.71% (FY 2025: 3.88%)
and the cost of new retail funding aligned to our expectations.

•

Asset quality remained robust; 3-month-plus arrears(4) were 1.7% (FY 2025:
1.6%), within management expectations.

•

CET1 ratio increased to 12.6% (31 December 2025: 12.4%)(5). Capital generation
in the quarter was in line with expectations and consistent with our
trajectory toward the FY26 guidance range of >13.2% pre-Basel 3.1,
reflecting the typical first-quarter step-up in operational risk-weighted
assets.

•

Total capital ratio and AT1 issuance. In April 2026, we completed the issuance
of a £250 million AT1 instrument in conjunction with a tender offer of the
Group's existing £124 million AT1 securities. This increases the Group's
total capital ratio from 14.9% to 16.0%, had the AT1 issue taken place as at
31 March 2026.

•

Originate-to-distribute. We disposed of our residual interest in the £510
million Lanebrook Mortgage Transaction 2024-1 as part of our OTD strategy.

•

ThinCats update. Following the Group's acquisition of ThinCats in Q4 2025, we
completed the purchase of a c.£160 million loan portfolio, originated and
serviced by ThinCats, further building scale in our targeted SME segment.

Footnotes:

1.

As at 31 March 2026, the Group's OTD balances increased to £1.8 billion,
resulting in a loan book of £17.9 billion (December 2025: £17.8 billion).

2.

Medium-term guidance: Loan book growth of low double digits (based on a CAGR
from FY24); Cost to income ratio of mid 30s; Underlying profit before tax
growth of mid-high teens; Underlying return on tangible equity of high-teens;
Maiden ordinary dividend in respect of FY26 results and a CET1 ratio of
12-13%.

3.

The CET1 ratio guidance includes the foreseeable dividend expected to be paid
in 2027.

4.

The Group calculates its arrears measure by including all accounts that are
greater than 3 contractual payments down at month end but excluding loans that
are term expired. This is then divided by the total loan book, excluding term
expired loans. ABL and Development Finance loans are excluded from the arrears
measure given there is no concept of arrears in these products. Purchased or
Originated Credit-Impaired loans are also excluded.

5.

Includes Bank of England levy of £2.6 million (Q1 2025: £2.5 million) and
operational risk RWAs of £1,174 million (31 December 2025: £1,046 million),
reflecting the annual recalibration of operational risk capital requirements
effective 1 January 2026, equivalent to c.13bps of CET1. Total RWAs as at 31
March 2026 were £12,331 million (31 December 2025: £12,003 million).

 

 For investor enquiries, please contact:
 Murray Long
 Head of Investor Relations
 murray.long@shawbrook.co.uk (mailto:murray.long@shawbrook.co.uk)

 For further information, please contact:
 Zander Swimburne
 Teneo
 shawbrook@teneo.com (mailto:shawbrook@teneo.com)

 About Shawbrook
 Shawbrook is a UK bank providing specialist lending and savings products to
 consumers, SMEs and professional real estate investors. Our business model
 combines specialist lending expertise with a scalable, technology-enabled
 platform and disciplined credit underwriting. Shawbrook serves approximately
 600,000 customers through its portfolio of brands. Shawbrook Group plc is
 listed on the London Stock Exchange and is a constituent of the FTSE 250
 Index.

 

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