The bank noted that net mortgage lending for the year came to £2.4bn in 2021, which is up from £841m in 2020.
The average loan to value for its mortgage book came to 56.8 per cent, which is slightly up from 56.1 per cent in 2020.
Its core mortgage accounts with over three months of arrears also improved, coming to 0.13 per cent in 2021 as opposed to 0.18 per cent in 2020.
From a strategy perspective, the group said it would focus on growth in new mortgage business volumes via mortgage intermediaries.
However, it said it recognised that it was “heavily reliant on interest income” from its mortgage portfolio so it would be looking for opportunities to diversify its income streams and yield.
In 2021, its net interest income came to £323.9m, an increase from £266.9m the year before.
Return to profitability
The lender reported a profit before tax of £31.1m, which is an increase of £134.9m on the year before and is the first profit reported by the bank in 10 years.
Chief executive of The Co-operative Bank, Nick Slape (pictured), said the results signaled a “return to sustainable profitability”.
He added: “These positive results demonstrate that our position on ethical and social matters is not only good for our communities, but also delivers strong commercial outcomes.”
He continued that its return to profitability and balance sheet growth gave it a “strong platform for growth in the years ahead”.
Slape said as ethics and sustainability became more important to customers it was working on improving its product range and services and there was an “important role for an ethical bank like us in the marketplace”.
The group was awarded the UK’s best ESG-rated high street bank by Sustainalytics in 2021 and launched its sixth value and ethics poll and the responses would “inform and update” its ethics policy.
In-housing of mortgage services
The report said the group had given formal notice to Capita, who was its mortgage servicing operations provider, as it would now be done in-house by December this year.
It said it believed it was the “right time” to move this in-house as it would “ensure provision of a consistent end-to-end service for mortgage customers”.
It added: “We are working closely with Capita to ensure a safe reintegration and support for the incoming team to enable a seamless transition for our mortgage customers.”
Slape said: “This along with increased cost efficiency gives me the confidence that the bank’s business model, refreshed strategic vision and our stable management team take us forward into our 150th year of ethical banking in a strong position”
