Powerhouse mutuals are driving mortgage market

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THE BIG three building societies in Yorkshire are playing a leading role in the UK’s economic recovery with new figures revealing that the mutually-owned lenders provided more than a third of all new home loans last year.

The combined net lending of Yorkshire, Skipton and Leeds hit £4bn in a mortgage market worth £11.2bn in 2013.

All three institutions delivered strong set of annual results yesterday showing growth in profits, customer numbers and job creation.

Peter Hill, chief executive of Leeds Building Society, said: “The financial services industry in Yorkshire is definitely growing and it’s growing stronger. It is a resounding endorsement for the mutual movement.”

He said that overall, the mutual sector has performed well since the financial crisis of 2007-08 because of its strong capital base, good heritage and prudent business model.

Leeds said net residential lending rose 42 per cent to a best-ever £1bn, while pre-tax profit rose by 18 per cent to a record £64.2m.

Savings balances grew by £884m to £8.6bn, the highest level in its history, it added. Total assets stood at £11.1bn at year end.

Leeds welcomed 71,000 new members, taking total membership to a record 714,000.

Skipton Building Society’s net lending more than doubled to nearly £1bn during 2013. The group’s pre-tax profits soared to £102.5m, from £35.4m the previous year. This was helped by the core savings and mortgages division, which saw a massive increase in pre-tax profits to £50.4m, from £4.5m in 2012.

The Yorkshire, Britain’s second biggest building society behind Nationwide, reported an 11 per cent increase in core operating profit to £152m.

Its net lending more than trebled to £2bn during 2013. It had total assets of £34.5bn at the end of December.

Chris Pilling, chief executive, told the Yorkshire Post that growing confidence and the improving economy helped the society’s performance last year, but the mutual sector’s ethos also played a role.

He said: “Customers are clearly still fed up with the banks and banks are still not in the position to provide what customers want.”

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