British mortgage lender Northern Rock said it is comfortable with analysts' pre-tax profit range for 2003 of £351.8 to £376.7 million sterling, with a mean of £369.0 million and growth of 13 per cent.
In a first-quarter trading update, the bank, which operates in the Irish market, said record lending has continued throughout the quarter and is also set to be strong in the second quarter of the year.
"Operating performance in the first quarter of the year continues to be very strong. It is in line with our operational expectations and strategic objectives and builds on the excellent progress we made in 2002. We are again set to deliver against our low cost, high quality, high growth strategy," commented chief executive Mr Adam Applegarth.
This performance is in line with its strategic intention of achieving annual growth in assets under management of around 20 per cent.
The bank reiterated its strategic target is to keep return on equity in the 18-21 per cent range.
Economic fundamentals continue to support the housing and mortgage markets, said Northern Rock.
Economic forecasts indicate that GDP growth will be around 2 per cent this year while unemployment is unlikely to see substantial rises. Interest rates are expected to stay low.
The net effect of these economic forecasts means that affordability indices are likely to remain strong and the bank therefore believes house price inflation will return steadily to more long term sustainable levels.
The mortgage market is anticipated to quieten further, but front end incentives will continue to encourage the active remortgage market, albeit with lower levels of equity withdrawal.
AFP