The Nationwide Building Society has posted its results for the quarter from 5 April 2016 to 30 June 2016.
It has reported a statutory profit of £401 million and an underlying profit of £368 million for the quarter, both of which are after recognising a gain of £100 million on the disposal of Nationwide’s stake in Visa Europe.
The UK’s largest building society has seen an increase in gross mortgage lending of 26% to £8.6 billion, equating to a market share of 15%.
The average LTV of new lending was 70%, compared to 69% for the same period last year. Net lending of £3.5 billion increased 67% and represented a market share of 52.8%.
Gross and net mortgage lending included buy-to-let lending of £1.7 billion and £0.9 billion respectively. Following the announcement of tax changes relating to buy-to-let income, the group has made changes to its affordability assessment to ensure borrowing for customers remains affordable. An expected contraction in the buy-to-let market, combined with its underwriting changes, is likely to lead to lower levels of buy-to-let new lending for the remainder of the year, the mutual said.
Joe Garner, the Nationwide’s chief executive, said: “As the world’s largest building society, we are in the fortunate position to be able to take a long term view and focus on providing great service, security and stability for our members. This will be particularly important in a time of increased uncertainty and market volatility following the EU referendum.
“The contribution that our Society continues to make in support of the housing market and by offering long term value to savers, even in the current low interest rate environment, is evident in our trading results for the first quarter which represent a strong start to the year.
“Following the decision by the Bank of England to cut the Bank Rate to 0.25%, the Society will pass on the decrease in full to existing Base Mortgage Rate (BMR), Standard Mortgage Rate (SMR) and tracker mortgage customers. In addition we will protect members who save regularly and who are building up a deposit to buy their first home; as a result, the Flexclusive Regular Saver at 5%, the FlexOne Regular Saver at 3.5% and the Help to Buy ISA at 2% are being maintained at their current rates.
“We continue to deliver market leading customer service amongst our high street peer group with a lead of 4.8%1, reflecting the primary focus on members which is the essence of the building society difference. A recent example of our continuing investment in service is the launch of our new Banking app with improved navigation and a range of new features.
“Looking forward, we remain focused entirely on the needs of our members, particularly during times of uncertainty. It is for this reason that we announced at our AGM last month our five-point plan for how we will support our borrowers and savers post Brexit and help them realise their ambitions. This includes a number of commitments to help people onto the housing ladder, or to move up through the housing market, while supporting those who want to save and plan for the future.”