British banks have struggled to win the trust of investors, but Virgin Money UK, the country’s sixth largest lender, has a bigger credibility problem than most. The bank’s shares are valued at less than half the value of its tangible assets, a greater discount than those attached to its London-listed peers. An ample capital pile and fatter margins indicate that the stock’s beaten-up valuation is too harsh.
Higher interest rates gave an easy kick to pre-tax profits, which beat expectations over the 12 months to the end of September and were 43 per cent higher than the previous year. The net interest margin, the difference between what the bank pays out on customer deposits and what it earns on loans, expanded to 1.85
