British mortgage bank Northern Rock reported strong first-quarter trading today amid a 34 per cent rise in net lending.
The low-cost mortgage specialist said it was on track to increase its assets in the top half of its 15 per cent to 25 per cent target range this year.
Northern Rock, which also has operations in Ireland, said it was comfortable with analysts' consensus forecast for a 2007 underlying profit of £434 million, which would be up 18 per cent from 2006.
Credit quality remains under control, and the bank predicted the UK mortgage market will grow at least 4 per cent this year.
Earlier this morning, Northern Rock shares were up 0.4 per cent at £11.49, to value the bank at about £4.8 billion.
The bank said it might sell its commercial secured loan book and would return the proceeds of any one-off disposals to investors by buying back shares, which would boost earnings.
Analysts estimated the return of cash could amount to between £70 million and £125 million.