OneSavings Bank, the challenger bank which owns the Kent Reliance brand, has upped its pre-tax profits as it increased lending to small and medium-sized businesses.

Underlying pre-tax profits grew by 60% to £47.6 million in the first half of the year, up from £29.7 million in the same period 12 months earlier.

Its loans and advances grew by 17% to £4.6 billion, as it picked up £778 million of new clients and bought a group of second mortgages for £260 million in March.

The bank’s low cost model, outsourcing customer services call centres to India, also helped to boost performance.

The Chatham-based company joined the FTSE 250 in June, marking a huge turnaround for the former Kent Reliance Building Society.

It was brought back from the brink of financial ruin when it was rescued by private equity investors in 2010.

The business of the building society was eventually transferred into newly formed OneSavings Bank in February 2011, which then launched on the London Stock Exchange last year.

Chief executive Andy Golding said he was pleased the company has continued to grow its loan book, supported by acquisitions like the portfolio of second mortgages.

He also said the firm had improved its net interest margin – the difference between interest income and interest paid – and its cost to income ratio, “demonstrating the strength of our cost-efficient operating model”.

He added: “This growth has been delivered whilst maintaining a capital ratio comfortably above our financial objective, and improving customer service levels, driving a net promoter score of over 50%.

“Despite recent political and regulatory announcements, and some increasing competition in certain lending niches, the market remains supportive of our core businesses and we continue to see strengthening levels of new business applications and good opportunities for growth at attractive returns.”