Mortgages boost profits by almost 11% at Coventry Building Society

Profits have risen almost 11% for Coventry Building Society, aided by a record growth in mortgages.

The mutual’s statutory profit before tax grew by 10.7% last year to £239.1m. Net interest income at £385.0m is £21.1m higher than the previous year.

Mortgage assets increased by £3.5bn, representing growth of 12% – more than four times faster than the market.

The society also saw record savings balances, with savings deposit balances growing by 11% – nearly twice the rate of the market.

Mark Parsons, chief executive, Coventry Building Society, said: “Not only has this performance supported our members in the shorter term, but our financial strength supports the investment that enables us to compete and grow in the future.”

He said the society could be proud of the growth in savings, a performance which he said reflected the society’s competitive pricing, shown average savings rates in 2016 being 0.85% above the market average.

“Competitive pricing has been equally successful in attracting new mortgage business. Our low operating costs and impairment losses give us the ability to operate at low but sustainable margins. This returns real value to our members – but it is also underpinned by strong and growing capital ratios supported by our 2016 profits,” he added.

“This in turn provides reassurance that we have the financial strength and flexibility to sustain the society into the future whatever the economic conditions.

“Looking forward, the board is confident that the society is well positioned to continue its strong, profitable, member-focused growth. There are some economic and political uncertainties at present and will be for the foreseeable future. However, this is no longer unusual and our strong track record shows that our simple business model based on Putting Members First, with low risk lending and low cost operations, can thrive even in uncertain conditions.”

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