Building society’s profits up as lending increases

West Brom Building Society has made “solid progress” as lending and profits rose.

Underlying profits were up 11% in the six months to September, to £4.2m, while its key measure of prime owner-occupied mortgage balances increased at the same rate to £2.6bn.

Jonathan Westhoff, chief executive of the West Brom, said: “Although the West Brom operates a traditional building society model built around the provision of savings, investments and mortgages, we must still ensure we adapt to the changing trends in how people view, manage and transact with their money.

“It is this flexible and forward-thinking approach that puts us in a strong position to deliver against our core objectives for the remainder of the financial year, helping more members purchase their own homes and plan for a secure future.”

Jonathan Westhoff, chief executive of West Brom Building Society

Despite the “potentially unsettling” impact of the first interest rate rise in a decade, the West Brom believes “borrowers are generally well placed to cope financially”. The building society has seen a reduction in the number of residential mortgage holders experiencing significant arrears.

First time buyers represented 28% of the £478m of new lending during the period.

Westhoff added: “We have successfully increased new lending for home ownership and channelled more than a quarter of these funds to help buyers taking their first step onto the property ladder.

“There is still demand for mortgages, with borrowers understandably favouring longer term fixed rate products given that Bank Base Rate has finally moved and future rises are to be expected.”