Virgin Money UK expects steady net interest margins and "subdued" non-interest income in the 2021 financial year after reporting a full year statutory loss of £141m.

The lender delivered a 10 per cent year-on-year fall in underlying pre-provision operating profit of £625 million due to net interest margin compression and base rate cuts.

Its net interest margin was 1.56 per cent compared to 1.66 per cent at the same time last year.

Non-interest income of £191 million was down from £206 million in 2019.

The lender expects underlying operating costs to fall to less than £875 million in the 2021 financial year from £917 million in 2020.

The statutory loss of £141 million - compared to £207 million in 2019 - includes £292 million of extraordinary items.