Skipton Building Society to get £20m stock market windfall
SKIPTON Building Society is looking towards strong full year results as the housing market improves and borrowers gain confidence.
Chief executive David Cutter said that while the mutual, which is celebrating it 160th anniversary this year, remains “naturally prudent and cautious”, he is confident that good lending, a good housing market, a reduction in mortgage arrears and a decrease in the cost of funding, which helped it produce strong half year results, will continue.
And he said second half results will be boosted by a £20m profit from the successful flotation of Wynyard Group on the New Zealand Stock Exchange this month.
Wynyard has been spun out of Skipton subsidiary Jade Software Corporation.
Mr Cutter said: “A building society is naturally prudent and cautious, but there is no doubt that some of the UK economic results have been stronger.
He said the Skipton’s 480-branch Connells estate agency chain, which saw a 16.8% rise in sales in the first half of the year, was seeing more confidence in the housing market.
“You can see a number of indicators in terms of viewings, mortgage applicants and average house prices starting to uptick again.
“There is renewed confidence in the housing market in London and the South, not as much in the North. The Funding For Lending scheme, launch last August has helped and there are positive signs across the housing market.”
Skipton said that pre-tax profits for the six months to June 30 increased by 59% to £34.4m, up from £21.7m in the first half of 2012, and compared to £35.4m during the whole of last year.
It increased gross mortgage lending by 64% to £1.09bn and added 11,000 customers during the last six months with net lending growing by £455m, representing a growth in mortgage balances of 4.4% in a period where overall UK residential mortgage lending was flat.
