Mortgage News
Skipton’s profits leap 48%
Skipton Building Society has reported a 48% jump in profits for the first six months of 2010.
Skipton’s group profit before tax totalled £21.7m, up 48% on H1 2009’s £14.7m and it reported increased capital strength, with Tier One capital increasing by 34% to 11.4% compared to 8.5% for the six months to 30 June 2009.
In addition to its plan to boost performance following a difficult 2009 and diversify the business model, its merger with Chesham Building Society, completed on 1 June 2010, saw Skipton increase its capital strength further and add 21,000 customers and three branches to its business.
The mortgage and savings division saw a loss of £5.7m in the first six months of the year, down from a loss of £9.1m for H1 2009.
Skipton has also reduced it group mortgage assets by £0.6bn since the beginning of the year to £10.1bn.
Arrears at the lender have reduced by 12%, with the charge for mortgage losses amounting to £3.2m, compared to £22.1m in the first half of 2009.
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Skipton’s financial advice division bounced back in 2010, reporting a profit of £1.7m compared to a loss of £0.1m in H1 2009, while the estate agency division saw profits increase to £31.7m compared to £20.8m in the six months of 2009.
In addition, new instructions increased 23% and the level of exchanges rose 13%.
David Cutter, group chief executive of Skipton, said: “A 48% increase in profit and 34% increase in our Tier One capital ratio is a very pleasing performance compared to our June 2009 results.
“But there is no room for complacency. Uncertainty stemming from fears over the financial stability of certain European nations and the impact of the government’s austerity package has highlighted the need for continued vigilance.”
He continued: “These most recent results once again demonstrate our ability to prosper despite such adverse conditions while, at the same time, remaining true to our ethos of offering consistent good value and service to our members.
“Therefore I remain confident that steps we took in the first six months of this year, coupled with our unique business model, will ensure a sustainable and strong future for our business.”