Average monthly loan originations for the year were down 30.6% to £97.6m, from £140.7m in 2020.
Together’s loan book declined 3.6% from £4.2bn in 2020 to £4bn in 2021, according to its financial results ending 30 June.
The weighted average indexed loan-to-value (LTV) remained conservative at 52.1%, from 54.9% in 2020.
Together reported average monthly lending originations of £136.2m in the second half of the year, up 130.8% on £59.0m in the first half, with quarter-on-quarter growth throughout the year.
Weighted average origination LTVs remained conservative at 59.8%, from 57.7% in 2020 and interest receivable and similar income was down 4.5% at £370.9m.
The underlying net interest margin remained attractive at 6.2%, despite continued competitive market conditions and reflecting the shape of the loan book throughout the period.
The annualised cost of risk has decreased to 0.4% from 1.7% the year, before due to a reduced impairment charge during the year as a result of the improved macroeconomic outlook.
Underlying profit before tax was up 26.3% to £149.7m and cash generation remained robust, with cash receipts of £1.7bn, up from £1.6bn in 2020, as redemption levels remained strong.
Gerald Grimes, group chief executive designate of Together, said: “Together continued to build on our strong momentum during the year, with lending levels in the second half up 130.8% on H1 and returning to pre-pandemic levels in June and July.
“We also delivered increased profitability and cash flows, while accelerating our modernisation and transformation projects and adding significant funding headroom as we shape our business for an exciting future.
“At the start of our financial year the UK was still in its first lockdown, the property market was only just reopening, millions were furloughed, millions more deferring their mortgage payments and development activity had all but ceased.
“Against this backdrop, we have continued to increase our lending levels during the year , with average monthly originations rising from £59.0m in the first half to £136.2m in the second half and reaching £190.3m in June.
“This contributed to the group delivering increased underlying profit before tax of £149.7m and annual cash receipts of £1.7bn in the year.
“It has taken common sense, logic, a calm approach and decisive actions to navigate through this unprecedented time and these results are a testament to the extraordinary efforts of our colleagues over the last 12 months.
“We have also added significant additional scale and depth to our funding structure, raising or refinancing over £1.3bn of facilities in five transactions during the financial year, including issuing the first small balance commercial real estate mortgage backed securitisation in the UK since the Global Financial Crisis.
“Since the year end, the group has issued its first dedicated facility for non-performing loans, Brooks ABS, and in September we refinanced our HABS warehouse facility and priced our inaugural first-charge only RMBS to leave the Group with funding headroom of over £1.4bn.
“While the economy is performing much better than expected and is forecast to grow strongly, we expect that following government COVID-19 support schemes being withdrawn and increased changes in employment status many people may find themselves in a different position to how they entered the pandemic.
“With robust levels of capital and liquidity, Together is well placed to help increasing numbers of customers to realise their ambitions and to play our part in supporting the UK’s economic recovery.”
