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Increased revenue for TSB driven by taxpayers' rush to beat the April stamp duty deadline

TSB Assists Over 3,000 Borrowers in Buying New Homes in March, Showing a 36% Yearly Rise Compared to Previous Years.

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Increased revenue for TSB driven by taxpayers' rush to beat the April stamp duty deadline

TSB Bank's First-Quarter Boost

TSB Bank is riding high due to its cost-cutting drive and the stamp duty rush before April's changes. This Spanish-owned lender helped over 3,000 individuals buy new homes in just March alone, marking a 36% year-on-year increase.

This surge in demand pushed TSB's pre-tax profit nearly doubling during the first quarter of 2025, reaching £101.3million compared to £53.4million in the same period last year.

Buyers were eager to beat Rachel Reeves' new stamp duty thresholds starting April. TSB's operating expenses also fell 4.7%, hitting £195million, as the bank remained committed to efficiency initiatives and cost control.

TSB's total customer lending rose by £100million to £36.4billion from its 2024 year-end. Mortgages and credit cards drove this growth. Secured lending increased by 12% year-on-year in the period to £1.5billion.

First-time buyers, in particular, benefited from TSB's expanded mortgage offerings for new-builds and shared ownership homes. Over 1,900 first-time buyers were helped by the bank in this period.

Personal loans and credit card lending also saw strong demand, with loans up by 5% and credit card lending by 13%, marking TSB's strongest quarter for loans since 2020.

TSB's net interest margin rose by 13 basis points to 2.89% in Q4 2024, representing a 28 basis point increase from the same period last year.

Looking forward, TSB anticipates the UK consumer staying resilient amid sluggish economic growth and global uncertainty, despite key concerns about trade tariffs and their impact on the UK economy[1][2].

Insight: The Impact of Stamp Duty Changes

Rachel Reeves, the Chancellor of the Exchequer, introduced adjustments to the Stamp Duty Land Tax (SDLT) in her Autumn Budget and Spring Statement in 2024 and 2025. These changes have significantly affected the property market, leading to increased demand for mortgages[1].

  • 0% Stamp Duty Threshold: Lowered from £250,000 to £125,000, causing more buyers to incur Stamp Duty costs[2].
  • End of Temporary SDLT Holiday: The 0% band reverted from £250,000 to £125,000[2].
  • Additional Properties Surcharge: The surcharge for second homes and buy-to-lets increased from 3% to 5%[1].

These modifications have raised property buying costs for both first-time buyers and investors, causing a spike in demand for mortgages in Q1 2025[1][2][3].

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Marc Armengol, TSB's chief executive, commented: "TSB has delivered an exceptional performance in the first three months of 2025 and continues to make an increasing contribution to Sabadell Group."

Sabadell, TSB's owner, is currently embroiled in a prolonged takeover battle with rival BBVA[3]. BBVA is awaiting approval from the Spanish government for the deal, which has faced strong opposition from the Sabadell board[3].

Separately, Metro Bank announced on Thursday it remains "profitable on both an underlying and statutory basis" at the beginning of the year[4]. Metro Bank's total net loans dropped by 6% since the end of the last year to £8.5billion as of 31 March[4]. This decline occurred due to a sale of the unsecured personal loan portfolio, a move towards corporate, commercial, and small business lending, as well as specialist mortgages[4].

Daniel Frumkin, Metro Bank's CEO, reaffirmed the group's commitment to meeting its guidance[4]. Last week, Lloyds Banking Group reported a mortgage lending increase of £4.8billion, with 19,000 completions in the first three months of the year[5]. 31 March was Lloyds' single day record for mortgage completions.

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[1] BBC News. (2025, March 2). Stamp duty changes: What you need to know. Retrieved March 24, 2025, from https://www.bbc.co.uk/news/uk-59666655[2] HM Revenue & Customs. (2025). Stamp Duty Land Tax: Residential properties. Retrieved March 24, 2025, from https://www.gov.uk/stamp-duty-land-tax[3] The Guardian. (2025, March 19). BBVA's takeover of Sabadell faces hurdles amid EU concerns over competition. Retrieved March 24, 2025, from https://www.theguardian.com/business/2025/mar/19/abbva-sabadell-eu-competition-regulator-takeover[4] Metro Bank. (2025, March 24). Growth & Income Announcement. Retrieved March 25, 2025, from https://ir.metrobankplc.com/news-and-events/news/2025/growth-and-income-announcement[5] City A.M. (2025, March 24). Mortgage completions hit record high for Lloyds Banking Group. Retrieved March 25, 2025, from https://www.cityam.com/mortgage-completions-hit-record-high-for-lloyds-banking-group/

  1. TSB Bank, following its cost-cutting drive and the stamp duty rush before April's changes, saw a 36% year-on-year increase in helping over 3,000 individuals buy new homes in March 2025.
  2. As a result, TSB's pre-tax profit nearly doubled during the first quarter of 2025, reaching £101.3million compared to £53.4million in the same period last year.
  3. Mortgages and credit cards were key contributors to TSB's total customer lending, which rose by £100million to £36.4billion from its 2024 year-end.
  4. The surge in demand for mortgages was largely driven by Rachel Reeves' changes to the Stamp Duty Land Tax, including a 0% Stamp Duty Threshold lowered from £250,000 to £125,000 and the end of a temporary SDLT holiday.
  5. TSB anticipates the UK consumer staying resilient amid sluggish economic growth and global uncertainty, forecasting continued demand for mortgages and other finance products.
  6. Looking to take advantage of the high demand in the mortgage market, TSB expanded its mortgage offerings for new-builds and shared ownership homes, helping over 1,900 first-time buyers in the period.
  7. Meanwhile, personal loans and credit card lending also saw strong demand, with loans up by 5% and credit card lending by 13%, marking TSB's strongest quarter for loans since 2020.
TSB facilitated the purchase of over 3,000 new homes in March, marking a 36% year-on-year upsurge in such transactions.

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