Coventry announces record results
Coventry Building Society has reported net mortgage lending of £751 million, equivalent to 31% of all net mortgage lending in the UK.
The UK's third largest building society announced its results for the six months ended 30 June 2010 with mortgage balances increasing by 39% to £4.2 billion.
Gross mortgage advances totalled £1.6 billion, representing 18% of all mortgage advances by building societies and mutual banks.
The average loan to value ratio on advances made in 2010 was 54%.
Profit before tax increased by 20% to £43.5 million and total assets grew by 50% to £6.5 billion.
On the retail savings side, balances jumped by 76% to £6.4 billion, funding comfortably the substantial growth in mortgages. Retail savings balances grew by £1.7 billion (13%) during the first half of 2010.
Net retail receipts were equivalent to 8% of net retail receipts of all UK banks and building societies.
The society donated a further £971,000 to the Poppy Appeal, bringing total donations since October 2008 to well over £3.5 million.
The merger with Stroud & Swindon will complete on 1 September 2010. Integration plans are on track.
David Stewart, chief executive, commented: "I am pleased to report that the society continues to perform well. Underlying profit before tax increased by 40% to £46.5 million, during a period in which the society's net mortgage lending was equivalent to 31% of the market as a whole. These excellent results maintain our record of strong performance since the onset of the credit crisis in 2007.
“We have been able to do this because Coventry's simple business model was equipped to cope with the events of the past three years.
“In particular, we have remained very much open for business, lending at modest loan to value ratios and to low risk borrowers. The increase in margins available for new mortgages means that our ability to continue to lend has helped support profitability.
“We continue to pay close attention to costs. Coventry remains the UK's most efficient building society as evidenced by a management expenses ratio of 0.37% of average assets (2009 first half year: 0.39%). The cost to income ratio for the first half of 2010 reduced to just 40.5%.
“We retain a high quality mortgage book, with mortgage arrears significantly below those for the industry as a whole. At 30 June 2010, just 0.79% of mortgage balances were 2.5% or more in arrears. This represents a slight fall from the position at the end of 2009. Impairment charges are certain to remain amongst the lowest levels reported by any of the larger UK lenders.”
