Its retail mortgage balances rose slightly to £8.13bn against the six months ending 31 December 2021, which closed the period with a balance of £8.03bn.
The mutual helped 1,936 first-time buyers purchase a home and since launching its mortgage and originations platform in March last year, has processed more than £2.5bn in applications through the system. It said this meant applications could be processed faster.
Net retail mortgage lending amounted to £99.3m, compared to £24.7m in June 2020.
Principality said it was committed to supporting its customers through the cost-of-living crisis and commended itself for passing just a quarter of the one per cent rise to the base rate on to variable rate mortgage borrowers. Despite this, its net interest margin widened from 1.14 per cent to 1.32 per cent.
The lender saw its profit before tax fall from £33.1m to £31m.
It said previous profits had been impacted by releases of impairment provisions for loan losses, however the current period was more consistent with the six months to 31 December 2021. For the first half of 2022, Principality held £17.6m in impairment provisions, broadly flat on the £17.8m it held in the six months to December 2021. This was down, however, on the £25m it held in the first half of 2021. The lender released £200,000 in impairment provisions compared to a release of £9.1m during the same period last year.
It said: “The group takes a conservative approach to lending and has robust affordability, credit quality and underwriting standards. The performance of the group’s loan portfolios continues to be strong with low levels of arrears, while rising house prices have led to lower potential losses.”
Some 0.51 per cent of its retail mortgage book is in arrears greater than three months.
Julie-Ann Haines (pictured), CEO at Principality Building Society, said: “Our financial performance was strong in the first six months, with £99m net growth in our mortgage book as we helped almost 2,000 first-time buyers get a home.
“So, members can be assured we have a strong balance sheet and profitability to reinvest in the business for their benefit, to help us create better homes for members, help members to financially secure their futures, as well as trying to create a fairer society for our communities.”
