InvestmentsMar 6 2015

Building societies show strong 2014 lending figures

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Building societies show strong 2014 lending figures

A commitment to financial advisers and keeping product lines competitive yet simple has helped mutuals reap rewards, Peter Hill, chief executive of Leeds Building Society has said.

Mr Hill added: “We conduct 90 per cent of our business through advisers and have made an effort to give them the type of service for which they are looking.

“This includes investing in more business development managers, better back-up in head office, and thinking hard about innovation in our product lines.”

Mr Hill attributed the 24 per cent rise in Leeds’ mortgage lending, from £2.2bn in 2013 to £2.7bn in 2014, to working with advisers. Savings balances grew to £9.2bn, and there were 60,000 new members over the year.

He added: “There is a conveyor belt of products being designed around the at retirement market which will be unveiled later this year.”

Yorkshire Building Society, Skipton Building Society and Coventry Building Society also posted strong results.

In its 150th year, YBS recorded £7.6bn of lending, 13 per cent up on 2013’s £6.8bn, and increased its capital ratio to 16.1 per cent.

Skipton’s mortgage lending was up from £2.24bn in 2013 to £3bn in 2014. This helped to take its total mortgage book up to £12.7bn in 2014.

Meanwhile, Coventry’s mortgage lending increased 25 per cent, to £7.4bn, bringing its total mortgage assets to £27bn. Its capital ratio is at 25.4 per cent.

Adviser view

William Hunter, director of Edinburgh-based Hunter Wealth Management, said: “I think in the main my views of building societies are positive. Some of the bigger ones are fine,and know what they are doing, but a lot of them are small and have rules restricting who they can lend to. There is more trust with building societies than with banks.”

Fiona Sharp, senior financial adviser for Norfolk-based Almary Green, said: “Older clients are definitely loyal to building societies and local mutuals can offer good mortgage rates for people living in the area.

“I would not necessarily go to a building society, but some have cracking rates on Isas and bonds so I will take them into account.”