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Paragon Banking Group repurchases 70,000 shares to boost long-term value

A bold move to cut shares and raise earnings—why Paragon's buyback strategy could pay off. The UK mortgage rebound adds to its growth outlook.

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The image shows a line graph on a white background with text that reads "M4 Money Stock Break Adjusted in the United Kingdom". The graph displays the inflation and consumer prices of the UK.

Paragon Banking Group repurchases 70,000 shares to boost long-term value

Paragon Banking Group has bought back another 70,000 ordinary shares as part of its ongoing capital strategy. The move is designed to cut the number of shares in circulation and lift long-term earnings per share. The company's total buyback programme is capped at £50 million in value.

The latest purchase was handled by broker Jefferies International. After this transaction, the number of outstanding voting shares now stands at roughly 190.3 million.

The bank's buyback scheme aims to improve shareholder value by steadily reducing its share count. Management has repeatedly signalled confidence in Paragon's future earnings, viewing the current stock price as undervalued. On Friday, shares closed at 855.50 GBX—around 12% above their 52-week low.

Analysts often see buybacks as a sign that a company believes its stock is trading at an attractive level. The strategy also aligns with Paragon's broader push to optimise capital and position itself for growth in the coming years.

The move comes as the UK mortgage market shows signs of recovery. Forecasts from the Intermediary Mortgage Lenders Association (IMLA) suggest gross lending could hit £320 billion by 2026. Much of this growth is expected to come from new home purchase mortgages, which could benefit lenders like Paragon.

With the latest share purchase, Paragon has trimmed its outstanding shares to about 190.3 million. The buyback programme remains within its £50 million limit, leaving room for further transactions. Meanwhile, the bank operates in a mortgage market projected to expand steadily through 2027.

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