Trading Statement

Paragon Group Of Companies PLC
22 March 2007

TRADING STATEMENT



The Paragon Group of Companies PLC will shortly be meeting with analysts ahead
of its close period for the six months ending 31 March 2007.  The following is
an update on the trading position of the Group ahead of the end of the half
year.



The Board expects the results for the six months to 31 March 2007 to be in line
with market expectations.



Lending activity has been strong during the year to date, with completions more
than 30% higher than a year ago.  This growth is attributable to activity within
the buy-to-let business as the Group has continued its strategy of strongly
promoting buy-to-let lending whilst limiting consumer lending.



With redemption rates remaining low, the increase in buy-to-let lending in the
period has resulted in strong growth of the buy-to-let portfolio, increasingly
the dominant asset in the Group's balance sheet. The pipeline of new buy-to-let
mortgage business remains strong, ahead of the level a year ago, which augurs
well for a strong start to the second half of the year.  The credit quality of
the buy-to-let portfolio remains exemplary.



The Group expects to complete today its latest buy-to-let securitisation,
Paragon Mortgages (No. 14) PLC.  The £1.5 billion issue achieved pricing at
prime levels and attracted strong demand from investors in the UK, Europe and
the US. At 10 basis points over LIBOR, the coupon for the long-dated AAA rated
notes reflects the high quality of Paragon's buy-to-let originations.



Statistics from the Council of Mortgage Lenders show that 11% of all new first
mortgage lending in 2006 was for buy-to-let property.  Short term demand and
long term demographic factors remain supportive of a strong private rented
sector for the foreseeable future, suggesting that the buy-to-let mortgage
market has considerable room for further growth.



Within the consumer division, our focus remains on cautious lending rather than
volume growth and we have continued to restrict our activities to areas with a
low incidence of arrears.  In the current economic environment, with
affordability measures now more stretched for borrowers, we have allowed
consumer lending volumes to fall some 15% below those for the corresponding
period last year.  In addition, the Group has continued the orderly, managed run
down of the closed books.



The Board of Directors intends to announce the interim results for the six
months ending 31 March 2007 on 22 May 2007 and a full report on the progress of
the Group will be issued at that time.



For further information please contact:



Nigel S Terrington

Chief Executive - Telephone [phone]

or

Nicholas Keen

Finance Director - Telephone [phone]




                      This information is provided by RNS
            The company news service from the London Stock Exchange