RADICAL new rules to bring more competition into the banking market paid off yesterday as
It is only the second new licence to be awarded in more than 100 years - the first was
Its first loans will come in the car finance sector, sold through dealerships.
In the spring it will start offering consumer savings accounts, later moving into consumer loans.
It is the third unit to set up in Paragon group - the others are a buy to let mortgage business and a debt purchasing unit.
Paragon sent its initial application to the authorities in July, meaning the process took seven months.
That is a huge acceleration from the previous licencing system -
Part of the improvement is in the more detailed information given to applicants, while capital rules have also been changed.
Previously new banks had to hold more capital than established lenders. Now they have to hold 4.5 per cent core capital, below the seven per cent at older banks.
And previously banks had to hold enough capital on day one to meet anticipated needs in five years' time.
That is no longer the case.
"This is a far more efficient system for a business like ours," group chief executive
Former chief of
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