A CHALLENGER bank says it will remain true to its traditional roots in a digital transformation after recording its “best results ever”, its boss has told The Northern Echo.

Jayne-Anne Gadhia says Virgin Money has promised the lender will marry its established branch network to a technology drive aimed at allowing customers to bank on the move.

She also revealed the Newcastle- based operator, which employs 2,000 people in the region, has doubled lending since buying Northern Rock and increased staff levels by 12 per cent.

Virgin expects to launch its digital venture next year and is working with 10x Future Technologies to create a platform for the service, which customers will access through phones and tablets.

Ms Gadhia, chief executive, said the endeavour will allow the company to cater for a changing banking landscape, where convenience is key, while retaining a traditional feel through its branches.

She told the Echo: “We are continuing to build the digital bank; we are nine months into a 21-month programme, so by this time next year we will be in place to get ready to launch it.

“That will be transformational for the business.

“But we don’t think it will be the end of branches because we find that some people still like to have that faceto- face relationship.”

Ms Gadhia was speaking yesterday after Virgin Money revealed a strong economy, lower unemployment and a “resilient” housing market, albeit with a cautionary warning over “areas of weakness” in the near term, had driven its financial performance higher in the six months to June 30, with its mortgage and card businesses reflective of a robust performance.

According to its figures, underlying pre-tax profit increased to £128.6m, which was up from £101.8m a year ago, with statutory pre-tax profit up from £93.7m to £123.8m.

Mortgage balances increased seven per cent to £31.8bn, with credit card balances 13 per cent better off at £2.8bn, and Ms Gadhia confirmed the lender, which paid the Government £747m in 2011 for the so-called ‘good bank’ element of Northern Rock, fully expects to hit a long-held balance target of £3bn by the end of 2017 on the latter.

She told the Echo: “These are the best results we have ever had and we continue to grow. It is growth all-round and since we bought Northern Rock we have doubled lending and increased staff.

“We have created more jobs but everyone has been more efficient too, which has driven our success.”

Ms Gadhia also revealed the lender will become Virgin Atlantic’s preferred retail financial services partner in the UK from 2018.

Bosses say the airline agreement will offer customers a range of benefits, including Flying Club miles.

Ms Gadhia added: “We are really excited: it should give a new distribution channel.”