In its H1 results, Principality announced residential mortgage lending of £233.4m, compared to £161.2m in the same period last year.
Pre-tax profits also increased by £2.7m to £23.2m (30 June 2014: £20.5m excluding the impact of the £10.1m one off benefit from a change in the pension inflation assumption).
Graeme Yorston, Group Chief Executive of Principality Building Society, said:
“I am delighted to report another very strong set of results for the Principality Group for the first six months of 2015, where we have seen our strategy of growing the core business continuing to deliver.
“In the first half of the year we have once again grown our lending to customers buying their own home, contributing to the overall increase in lending to home owners which now exceeds £5bn for the first time in the Society’s 155 year history. Crucial to this and to the market as a whole, has been lending to first-time buyers where we have consistently supported people onto the housing ladder. As house prices have stabilised and low interest rates have been seen across the market a greater level of affordability has returned, enabling us to help over 1,100 first-time buyers move into their first home in the first six months of the year.
“The Group’s trading performance has been strong in the first half of the year. Excluding the impact of the pension changes last year, profit before tax has increased by £2.7m. Our profit for the first six months of the year has meant that we have been able to continue to grow our capital base, which provides vital protection for our Members from any severe market downturns, as well as providing us with important funding for our investment programme as we seek to transform our business into an organisation that will be relevant for both current and future members.”
With savings rates continuing at a record low, Principality said that it remains committed to its savers, with 87.4% of funds that it lends to borrowers still coming from its savings customers.
Graeme continued:
“Savers have continued to see interest rates fall which is an outcome of how the market is currently operating. Despite ongoing interest rate reductions from many of our competitors, we at Principality have done our best to try and support our loyal customers by minimising the impact of these wherever we can. Our lending programme continues to be funded by our savers and whilst we may have to take advantage of some of the wholesale funding opportunities that exist in the market to remain competitive, we do not envisage our model changing substantially.”
