RNS Number:2620Q
Paragon Group Of Companies PLC
29 September 2003


Trading Update

The Paragon Group of Companies PLC will shortly be meeting analysts ahead of its
close period for the year ending 30 September 2003. The following is an update
of the trading position for the Group ahead of the year-end and follows the
interim results, which were announced on 20 May 2003.

Paragon Mortgages' new lending volumes are significantly higher than in the
previous year and the new business pipeline is at record levels. New lending by
Britannic Money is ahead of our expectations at the time of the purchase,
despite the fact that the commodity mortgage products were withdrawn shortly
after the acquisition. The buy-to-let sector has continued to display all the
robust characteristics that make this a defensive sector and the Board is
confident of its prospects as we enter the new financial year.

Secured personal finance new lending has also experienced lending volumes
significantly higher than last year. The Group's strategic focus in recent years
has been to expand its involvement in more defensive areas such as buy-to-let
and secured personal finance. In pursuing this objective, we have continued to
limit originations within the retail and car finance areas.

The Group's various portfolios have continued to perform well with the arrears
performance of both Paragon Mortgages and Britannic Money buy-to-let portfolios
being exemplary.

Following the acquisition of Britannic Money at the end of June, the Group
undertook a review with the intention of restructuring the business to restore
it to profitability. Progress has been good and a number of plans have been
implemented earlier than expected. Unprofitable products have been withdrawn and
the company will be rebranded on 29 September 2003 to Mortgage Trust. A major
restructuring has been announced which will see the majority of functions being
relocated to the Group's operations in either Solihull or London, primarily over
the next three to six months. It is likely that virtually all of the
restructuring costs will now be borne in the year to 30 September 2003.

Paragon has consistently reduced its cost income ratio over a number of years.
There has been further progress compared to the same period last year, even
allowing for the acquisition of Britannic Money. Further substantial savings are
expected to arise as a result of the restructuring exercise, which should
further benefit the cost income ratio in future.

The Directors are pleased to report that overall our expectations for the year
ending 30 September 2003 remain unchanged.

The Board of Directors intends to announce the preliminary results for the year
ending 30 September 2003 on 26 November 2003 and a full report on the progress
achieved by the Group, including further detail of the integration of Britannic
Money, will be issued at that time.


For further information, please contact:

Nigel S Terrington

Chief Executive                  Tel: 0121 712 2024

or


John Wriglesworth or Mark Baker

The Wriglesworth Consultancy     Tel: 020 7620 2228


                      This information is provided by RNS
            The company news service from the London Stock Exchange
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