Buy-to-let mortgages accounted for £588m or 14.8% of the gross lending during the year, up from £467.2m or 12.7% in 2015. The group’s mortgage book grew by £1.3bn to £15.5bn, an annual growth rate of 9.1%.
The group’s total assets rose to £19bn, an increase of 8.6% over 2015 and total group profit before tax increased by 15% to £168.9m, up from £146.9m in 2015.
By the end of 2016, the Society helped 23,666 homeowners to purchase or remortgage their properties, up from 23,094 in 2015. This included 4,327 first-time buyers and 1,292 Help to Buy equity loan scheme buyers, up from 618 in 2015.
The average indexed loan-to-value of group residential mortgages reduced to 47.9% from 48.5% in 2015.
Arrears of three months or more at Skipton are 0.73% of group residential, down from 0.91% in 2015, against an industry average of 1%.
Skipton has two closed mortgage portfolios currently in run-off, Amber Homeloans and North Yorkshire Mortgages. At the end of December 2016, 5.95% of Amber Homeloans’ mortgage book was in arrears by three months or more, down from 6.64% in 2015. Similarly, North Yorkshire Mortgages saw 4.31% of its portfolio in arrears of three months or more, down from 5.54% in 2015.
Skipton provides mortgages, savings, investments and pensions advice, and the society is the head of a group whose subsidiaries include two mortgage portfolios in run-off, a mortgage and savings provider based in Guernsey, a significant presence in estate agency and a small investment portfolio.
The group remains primarily funded by retail savings, representing 89.59% of total funding, up from 87.78% in 2015.
David Cutter, Skipton’s group chief executive, said: “Looking after people’s savings and enabling home ownership is at the very heart of what the society does as a mutual building society. I firmly believe that our long-term focus of being there to help people plan for their life ahead is resonating with our members.”
Profit before tax at Connells, Skipton’s estate agency division, rose 17.4% to £73.4m compared to £62.5m including £17m generated through the sale of part of Connells’ stake in Zoopla Property Group in 2015.
In December, the Society received authorisation to report its capital ratios using the Internal Ratings Based (IRB) approach, so its Common Equity Tier 1 (CET 1) ratio at 31 December 2016 was 23.9%.
If the society had remained on the standardised approach, its CET 1 ratio as at 31 December 2016 would have been 17.3%, against 16.8% in 2015.
