The bulk of mortgage completions came through its intermediary channel, Platform, which drove 88% of all lending.
The bank said its 2015 lending levels had exceeded expectations and were at their highest since 2010. In 2014, of its £1.1bn gross mortgage lending, 81%, or £0.9bn, came through the broker channel.
The loss before tax made by the bank, which has risen by over 130% from £264.2m in 2014, was caused by a decline in income from non-core bank activity as it continued to deleverage and sell assets no longer in line with its current risk appetite. Non-core business includes the closed book of residential mortgages, Optimum, originated through intermediaries and previously purchased mortgage portfolios.
Despite the loss, chairman Dennis Holt said he was “encouraged by the progress made towards building a sustainably profitable bank…”. He expects the bank to return to operating profitability before the end of 2017.
In his chairman’s statement, Holt said he was sorry for the failings of the past.
“During the year, the investigations by the Financial Conduct Authority and Prudential Regulation Authority into what went wrong at the bank in the period up to 2013 were concluded,” he said. “The board has taken the findings and the size of the potential fine extremely seriously and, on behalf of the bank, I would like to apologise again to customers for these past failings and reassure them that the bank is a significantly stronger organisation today.”
The bank was able to make an operational saving of £76.5m in part due to the closure of 58 branches and the reduction of its workforce. Some 54 more branch closures are expected this year as transactions carried out in branches fell 29% year-on-year.
In August last year, Co-op Bank outsourced its mortgage processing to Capita, a project which cost £33.1m. It said the initiative was progressing and would, over time, improve the bank’s ability to process mortgage applications, help to improve retention and reduce costs.
