The results from the UK’s fifth largest society show that new mortgage lending was £0.5bn in 2009, compared to £2.1bn in 2008.
In its 2009 half-year results, Chelsea made a £41m charge for mortgage fraud its buy-to-let book. This charge has now been reduced to £32.6m due to an investigation which uncovered fewer fraudulent cases than originally anticipated and improvements in the housing market which means losses on properties will be minimised.
Stuart Bernau, chairman and interim chief executive at Chelsea, said: “The losses incurred in 2008 and subsequent rating downgrade required us to focus on retail savings as wholesale funding became more difficult to acquire or retain. This, combined with the need to provide for the fraud in our buy-to-let book, resulted in a pre-tax loss at the half year of £26.3m.”
Chelsea is to merge with Yorkshire Building Society on April 1. When the merger is complete, the enlarged Yorkshire Group will have approximately £35bn in assets, 178 branches and 75 agencies.
