Paragon Banking Group has increased its motor finance portfolio by over 40% year-on-year for the three months to December 2017, totalling £28.9m.

Total new commercial and consumer lending was up 21%, to £103.3m. Asset finance lending grew 10% to £60m.

Paragon almost doubled its deposits over the course of the year, to over £4bn. Over the period, the group drew down £869m from the Bank of England’s Term Funding Scheme, and it expects to make further drawdowns throughout February, when the scheme closes.

The growth in the overall portfolio was mainly driven by expansions in the mortgage and development finance businesses, which grew 84% and 43% respectively.

Chief executive Nigel Terrington said: “We have made excellent progress during the first quarter. The lending growth achieved across the group has been outstanding and reflects the increasing strength of the franchise.

“Our retail deposit base continues to deepen, providing us with a stable platform for growth and the ability to optimise further the group’s funding structure. The organisational changes we completed last year, coupled with the growing demand and opportunity within specialist UK lending markets, will enable us to build on this momentum throughout the year.”