Key highlights:

• Savers rewarded with rates that were on average, by the end of the period, some two and a half times the average rates paid by the market¹ (30 September 2021: more than double) equivalent to a member benefit of £25.5m (2020/21: £8.8m).
• New lending applications of £609m (6 months to 30 September 2021: £542m), with completions of £276m (6 months to 30 September 2021: £479m) reflecting market conditions including delays in borrowers drawing down mortgages.
• Lending for first-time buyers represented 68% of lending for home purchase (30 September 2021: 47%).
• Statutory profit before tax increased by 24% to £18.1m (30 September 2021: £14.6m) driven by higher net interest income, fair value gains and revaluation gains on investment properties, which more than offsets higher impairment of loans and advances.
• Capital position remains strong with the Common Equity Tier 1 (CET 1) capital ratio improved to 18.3% (31 March 2022: 17.0%).
• Consistently strong feedback with customer satisfaction at 95% (31 March 2022: 96%) and a Net Promotor Score®² of +74 (31 March 2022: +81).
• Provided cost of living support to our colleagues with a one-off payment of £1,200 for over 430 people.

Jonathan Westhoff, Chief Executive, commented:

“It’s pleasing to report a strong half-year performance as we continue to navigate through a challenging external environment.

The pressures on the cost of living, especially the rising cost of essential goods such as food and energy, have moved from a forecast to a reality across the period, and we are focused on supporting our members where we can. This means that as interest rates increase towards levels not experienced for well over a decade, we have striven to mitigate the impact on borrowing members, whilst passing on the benefit to our saving members.

With there being no real indication of the situation easing in the near term, we will ensure we remain alert to where even further support may be necessary, for example for any borrowers who encounter temporary challenges in meeting their repayments.

With home ownership being at the very core of our mutual purpose, the first-time buyer is a prime focus of our activity. That is why 68% (30 September 2021: 47%) of all purchase lending was to those buying their first home, whether that be an outright purchase or a share of ownership.

For our saving members, who provide the funds that enable us to deliver on our home ownership objective, we have used the rising interest rate environment to improve their returns, to such an extent that the average rate paid by the end of the reporting period was two and half times that of the market average. This is an increase from the position of paying twice the market average a year earlier. This has resulted in the benefit to savings members increasing to around £25.5m from £8.8m for the six month period.

Although more recently the tensions between monetary and fiscal policy which created such market uncertainty have abated, it is likely that a degree of uncertainty around the trajectory of the economy will remain. Our strong capital position will support us in navigating this uncertainty. Most importantly, we remain committed to balancing the needs of our borrowers and savers during this uncertain time and specifically working with borrowers to achieve outcomes that are supportive and in their long-term best interests. I am extremely thankful for the efforts of my colleagues and their determination to continually deliver the Society’s Purpose.”

To read the full interim report, click here.

¹ Average market rates sourced from Bank of England Bankstats table A6.1
² Net Promoter Score and NPS are trademarks of Satmetrix Systems, Inc., Bain & Company, Inc., and Fred Reichheld.