Leeds Building Society delivers 'strong' results

Pre-tax profit rose to 31.7m from 20.3m while capital and reserves increased to a record level of 543m.

The society attracted 71,000 new members last year, taking total membership to more than 680,000. The savings balances rose by 225m to a record level of 6.8bn

Ian Ward, the chief executive, said: "Leeds Building Society achieved a good set of financial results for its members. Our successful, sustainable business model has delivered record operating profit and an increase in pre-tax profit, strengthening further our capital and reserves.

"Savings balances, which are a vital component of our traditional, mutual, building society business, rose by 225m to a record 6.8bn. Our net inflow, which represented 258m above our natural market share, was supported by 59,000 new savings' members, an increase of 35 per cent compared to 2008. These members were attracted by both the security and value we provide.

"Our new lending totalled 922m in 2009, compared to 1.28bn last year. However, this reflected the much smaller UK market with net mortgage lending, which declined to less than 12bn, only around a quarter of the 2008 volume.

"Throughout the year, we offered a wide range of mortgage products enabling many customers to remortgage or buy their first home. All of the society's residential mortgage lending is funded entirely by retail savings.

"We achieved a record operating profit, before impairment losses and provisions, of 80.1m, a significant increase of 17 per cent compared with 68.6m in 2008.

"However, as the UK suffered its worst recession for over 60 years, creating rising unemployment, there was inevitably an increase in borrowers experiencing difficulties meeting their mortgage repayments. As a result, the charge for impairment losses and provisions for commercial and residential property rose to 52.5m in 2009 (32.1m 2008)."

Mr Ward said the society had maintained strong credit ratings from both Moody's and Fitch, despite the tough economic environment.

He added: "Leeds Building Society has delivered a sound performance in 2009, with rising retail balances, increased profitability and even stronger reserves further underlining its successful, sustainable business model. This, combined with our prudent approach to lending, keen cost control and strong levels of capital means that we are in an excellent position to deal with the challenging economic outlook for 2010 and beyond."