This is a 20.7% increase on the £1.9bn in the same period last year, despite the disposal of a £220m mortgage portfolio of non-performing loans, resulting in a £15m loss.
In the first half, the mutual offered 13,118 new mortgage and remortgage deals, including 2,374 first time buyers, with 809 Help to Buy equity loan scheme loans.
Connells stable
Skipton-owned estate agent Connells, reported that profit before tax held steady for the six months to June which it said was due to a “good spread of revenue generating activities” despite falling house sales.
Lettings income is up 14.5%, mortgage services up 11.8% and surveying income increased 4.5%.
The lender also reported group profit before tax of £67m and a 19% increase in underlying group profit before tax to £87.4m.
Savings up
Savings balances increased by £0.5bn, up 3.7% and the society broadened its wholesale funding base by returning to the senior unsecured market for the first time in a decade, raising £350m for a five-year term.
The mutual was the first, and to date only, financial services provider to launch a Cash Lifetime ISA, helping 17,711 people in the first month of its launch in June to save for their first home or longer term financial needs.
Group administrative expenses totalled £253.9m of which £169.1m relates to the Connells estate agency group, up from £162.7m last year.
The outlook
In April 2017, global ratings agency Moody’s upgraded the society’s long term rating to Baa1 (stable outlook) from Baa2 (positive outlook).
David Cutter, Skipton’s group chief executive, said: “Skipton has delivered another strong performance during the first six months of 2017. Customer numbers increased by 25,907, and for the third year in a row the Society was included in the Sunday Times Top 100 Companies to Work For.”
Skipton reduced its legacy arrears issues from Amber Homeloans and North Yorkshire Mortgages down from 5.95% and 4.31% with its portfolio loan disposal and both books have been closed to new business since 2008.
Challenging economy
The mutual drew down £500m of funding under the government’s Term Funding Scheme (TFS) during the period. In addition the Society had £400m of the government’s Funding for Lending Scheme (FLS) outstanding at 30 June 2017.
Cutter added that the political and economic outlook were challenging. “These conditions make forecasting difficult and create a need for caution,” he said.
“We remain vigilant regarding potential economic headwinds, but the capital and funding actions taken during the period mean we are well placed to manage the risks that we face and to capitalise upon any opportunities that may arise for the benefit of our members.”
