Building society outpaces UK mortgage market but profits plunge by half
The Hinckley & Rugby grew its mortgage book to £696 million last year according to newly published accounts – but the building society also posted a 50 per cent decline in profits.
The reported 3.7 per cent increase in mortgages means the company outpaced the UK mortgage market as a whole, which grew by 3.1 per cent in 2019.
In its results for the 12 months to 30 November 2019, Hinckley & Rugby said it attracted an additional £45 million from savers last year, while its income from mortgage payments grew by £1.1 million to £17 million.
However, its pre-tax profits took a significant hit, plunging from £1.2 million in 2018 to £0.6 million. The company said this was due to banking swap rates moving lower and staying low during the year, coupled with the impact of fair value movements on derivative financial instruments.
Chief executive Colin Fyfe said: “I am pleased the Society has increased its mortgage book by more than £24 million and that credit quality remains exceptional.
“The UK mortgage market in 2019 was flatter than anticipated, with consumers reluctant to make significant buying decisions. Against that backdrop, Hinckley & Rugby sought to create the right balance of lending quality, acceptable margins and appropriate volumes.
“We continue to be competitive in this market by offering a more personal service, providing more flexibility and human underwriting. The Society has also expanded the products it offers in several sectors to meet demand.
“Strengthening the Society in areas including governance, risk, compliance, finance and underwriting has laid down solid foundations for the next stages of growth.
“I served on the counters of all our branches during the year and our members were keen to tell me about the great service they receive. I’d like to thank all our 145 staff – in the branches and at head office – for their hard work and commitment to the Society’s mutual ethos of outstanding service.”
2019 was an eventful year for the building society, which moved into its new headquarters in July.
