The mutual also increased its mortgage balances by six per cent since the end of 2018 and increased its savings balances by four per cent.
Its mortgage and savings division saw a £20.6m decrease in its profit before tax from £65.8m to £44.3m. This was attributed to fair value losses on equity release loans and associated derivatives of £12.5m in 2019 compared to an £8.1m gain in the six months ended 30 June 2018.
However, overall the group has seen its profit before tax fall from £104.7m to £72.3m during the period.
David Cutter (pictured), Skipton group chief executive, said: “I’m pleased to report a further increase in the society’s membership, and strong growth in both mortgage and savings balances. Profitability remains good but the decline in net interest margin is reflective of intense competition in the mortgage market, and more latterly in the savings market.
“An eight per cent reduction in house sales reported by Connells estate agency is also reflective of a subdued housing market, but the diversification and resilience of Skipton’s business model has contributed to a further improvement in the society’s very strong capital ratios.”
Connells
Its estate agency division, Connells, saw a slight drop in profit before tax from £28.9m to £26.2m as the number of house sales arranged in the period was eight per cent below the comparative period in 2018.
Overall, Connells said its total revenue increased with its lettings, mortgage services, land, new homes, conveyancing and survey and valuation divisions all producing positive results with its total income said to be “consistent” with last year at £215m.
David Livesey, Connells Group CEO, added: “We are proud of our ability to respond to challenging market conditions and to have produced such good results showing the strength, resilience and diversification of our business.”
