A CHALLENGER bank expects to meet a £3bn credit card balance target but will not compromise quality for quantity in reaching the goal, its boss has said.

Jayne-Anne Gadhia says Virgin Money has benefited from the stronger-than-expected economy in the months following the EU referendum, with its mortgage and card businesses reflective of a robust performance.

According to the Newcastle-based lender’s latest results for the first quarter, released yesterday (Tuesday, April 25), credit card balances stood at £2.7bn, with bosses citing their decision not to “follow competitors into top of the table pricing” as a factor in the growth.

The figure was higher than the £2.4bn recorded at the end of last year and means Virgin is closer to achieving its £3bn balance ambition by the end of 2017.

Speaking to The Northern Echo, Ms Gadhia said the company’s progress had been helped by a focus on its card customers and a resilience in the economy, which some had feared would be lost among Brexit uncertainty.

She said: “Credit cards have done well and we are making sure we are lending to people who can repay.

“We continue to prioritise asset quality over asset volume and we think £3bn is the right number.

“We hoped we would be still in a good position (with the economy), but the fact it has done better is a bit of a boost.”

Ms Gadhia said the company, which employs 2,000 people in Newcastle, had also seen mortgage demand remain strong, with gross lending of £2bn during the first quarter helped by clamour from people climbing the first rungs of the property ladder.

She added: “We are delighted; mortgages have been really strong and we have particularly seen strong growth in first-time buyers.

“The guys in our Gosforth office are doing a brilliant job in making sure the company continues to thrive.”

Virgin paid the Government £747m in 2011 for the so-called ‘good bank’ element of Northern Rock and has since grown its presence as a challenger to the established banking elite.

Earlier this month, it was linked with a bid for the Co-operative Bank.

At the time, a spokesman said the business didn’t wish to comment on the claims.

The Echo understands the company is prepared to consider opportunities to extend its presence in the financial sector, but that any growth is not predicated by a takeover.