Securitisation release

Paragon Group Of Companies PLC
26 June 2003

                         PARAGON SIGNS MORTGAGE BACKED

                                   NOTE ISSUE


The Paragon Group of Companies PLC ('Paragon') has today, through Paragon
Mortgages (No.5) PLC, signed agreements in respect of the issue of mortgage
backed notes in the aggregate amount of £250,000,000 (the 'Notes').


The £250,000,000 of Notes will be issued by Paragon Mortgages (No.5) PLC in two
classes. The senior notes in the amount of £226,250,000 are expected to be
assigned a rating of Aaa/AAA by Moody's Investors Service Limited and Standard &
Poors respectively. Moody's and Standard and Poors are expected to assign
ratings of A2/A, respectively, to the £23,750,000 Class B Notes. Although all
classes of Notes will share the same security, the Class A Notes will have
priority over the Class B Notes to quarterly payments of interest and as to
principal in the event of enforcement. The senior notes are split between a fast
pay A1 tranche of £50,000,000 and a slow pay A2 tranche of £176,250,000.


The pool consists entirely of buy-to-let mortgages. Paragon is a leading player
in the increasingly important buy-to-let market where it specialises in meeting
the requirements of the professional landlord. The credit quality on all of
Paragon's buy-to-let portfolios has been excellent. The current percentage of
borrowers over three months in arrears in the Group's buy-to-let business is
just 0.13%, which compares favourably with the Council of Mortgage Lenders'
statistics of 1.06% for the owner-occupied market. The credit enhancement of
only 1.6% reflects the rating agencies acceptance of the high credit standards
in the portfolio.


The margins over LIBOR for each of the tranches of the Notes are:


22 bp for the Class A1 Notes

32bp for the Class A2 Notes

135bp for the Class B Notes


The Notes are secured by performing mortgages, as well as a cash fund of 1.6% of
the aggregate current balances of the Notes. Paragon Finance PLC will be the
administrator for the issue.


HSBC Markets London are lead managers for the offering. The transaction is
scheduled to close on 26 June 2003, subject to documentation and appropriate
consents.


Nigel Terrington, Paragon's chief executive said: 'We are pleased to have
completed another transaction in the UK securitisation market. The low levels of
credit enhancement in the deal which follows the recent upgrade of PM3 reflects
the fact that the rating agencies are becoming increasingly comfortable with the
high credit quality of Paragon's buy-to-let mortgage programme.'



For further information, please contact:

Nigel Terrington                             John Wriglesworth
Paragon Group of Companies                   The Wriglesworth Consultancy
Direct line: 0121 712 2024                   Office: 020 7620 2228

Robert Drutman, Director
HSBC Bank plc
Direct line: 020 7991 5889


Notes to editors:

The Paragon Group of Companies PLC is one of the UK's largest independent
specialist lenders offering buy-to-let mortgages, personal loans, retail and
vehicle finance, with over £2.7 billion of assets.

In its interim results for the six months ended 31 March 2003, pre-tax profits
rose 14.1% to £23.4 million (2002 H1: £20.5 million), with buy-to-let mortgage
advances up 37.9% to £330.9 million (2002 H1: £240.0 million) and provision for
losses down 14.6% to £8.8 million (2002 H1: £10.3 million).





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