Santander UK, which writes one in five UK mortgages, has announced it will create over 600 jobs in its British branches and call centres over the next few months to further its continued growth and improve customer service.
Santander UK’s strong performance was in marked contrast to the Santander Group, which saw its half-year profits fall 1.6% to €4.445bn.
During H1 2010, Santander UK increased its lending to small and medium-sized businesses by 20%.
It has also significantly improved its cost-to-income ration since it bought Abbey in 2004, from 70% to below 39%, and down from 41% in H1 2009.
Santander’s average LTV on new business completions for the first half of the year was 61% compared to 59% in H1 2009, while the indexed stock LTV fell to 51% in Q2.
Capital repayments were broadly flat at £9bn. Net mortgage lending stood at £3.3bn.
The lender’s level of repossession fell slightly on H1 2009 to be 0.06% of Santander UK’s overall portfolio compared to the CML average of 0.13%.
Three-month plus arrears also dropped slightly from Q1 2010 to 1.42% in Q2, compared to the CML average of 2.22%.
Santander UK said that demand for credit remains subdued and the market challenging. While house purchase volumes are higher than a year ago, they are low compared to the past decade and house price inflation remains flat.
Santander UK said it expects interest rates to remain low for the rest of the year.
António Horta-Osório, chief executive of Santander UK, said: “We have had growth across all areas of the business, demonstrating that our transformation into a full-service commercial bank is progressing successfully.”
He added: “We are also investing to support the sustainable growth in our business and to continue improving our service. Over the next few months, we will be hiring more than 600 additional staff into our branches and call centres. This investment demonstrates the success of our strategy, our commitment to customer service and our ongoing support for the UK economy.”
