Leeds Building Society supported 20,000 first time buyers in 2021 as it set new records for mortgage lending

Reporting its annual results, chief executive officer Richard Fearon said the society’s record support for the housing market, including 20,000 first time buyers, had been a key element of its success in an "extremely demanding" year.

During the year, gross lending reaching a record £4.4bn. Growth in lending was aided by an increase in savings balances to top £15.25bn, compared with £14.2bn, the previous year, as the mutual maintained its support for savers by consistently paying above the market average savings rate.

The statement added: "In addition, the lender added to its track record for innovation, launching preferential mortgage deals for the most energy-efficient homes and developing a unique carbon neutral product for other purchasers."

Mr Fearon said: “2021 was a landmark year for Leeds Building Society and I’m incredibly proud of our successful performance, and all my colleagues have done for us to achieve this.

“We delivered on our purpose by supporting the housing market, bringing home ownership within reach for record numbers of first time buyers and Shared Ownership purchasers.

“The society broke so many records in 2021 – it was our busiest 12 months ever for mortgage applications and our biggest year for first time buyer lending, which accounted for almost one in three of all our new mortgages, another record.

“Our successful strategy for supporting customers less well served by the wider market saw us join the Government’s new First Homes scheme and complete the mortgages for its very first purchasers, and we remained active in shared ownership, winning further awards. With first time buyers in mind, we also launched a new regular saver account, ideal to start building up a deposit.”

Leeds Building Society delivered record profit before tax of £163.7m, compared with £80.7m 2020, enabling the business to further increase capital and reserves to £1.46bn, which the mutual said was well above the regulatory requirement.

The statement added: "The UK’s fifth-largest mutual has used its financial strength to protect members in the historic low rate environment, supporting borrowers by holding SVR (standard variable rate) after the Bank Base Rate rise in December, before helping its savers by increasing rates in response to the Base Rate rise announced earlier this month.

"Significant investment in IT continued to improve resilience, security and capacity, which increased the society’s operating costs for the year, although its keen focus on efficiency mean its cost to income ratio of 43.9% and cost to mean asset ratio of 0.58% (51.0% and 0.48% respectively, 2020) are still among the best in the building society sector.

"IT systems, such as the Mortgage Hub broker platform, are now integrated with major sourcing systems, saving brokers time and effort, and will facilitate further enhancements and improvements to online services for brokers and direct customers."

The society also created 121 jobs in key areas including data, IT, risk, and mortgage underwriting, as well as raising the minimum base level salary to £10 per hour, building on its existing Fair Pay Charter and going beyond its commitment as an accredited Living Wage Employer.

Mr Fearon said: “Our colleagues’ skill and commitment is what drives our business success and our record customer satisfaction scores, so I was delighted we were crowned the best financial services company to work for by Best Companies.

“The importance of giving great service to our members, and the role played by our branch network, was behind one of our two landmark moves in Leeds in 2021 – to our new Leeds Central branch in Commercial Street.

“The other move was leaving our historic Albion Street home for an award-winning new head office in Sovereign Street, which provides the room to unite office teams formerly split across three city centre sites.

“It’s modern and airy, with plenty of collaborative space to support our new hybrid ways of working, giving colleagues flexibility to be in the office when it’s most useful and make the connections which build our fantastic culture. We’re asking people to be in eight days each month and empowering them to choose how this works for their role.

“As our new headquarters are very environmentally friendly, being carbon neutral in operation, relocation also helped our commitment to cutting the Society’s carbon footprint.

“We’re making good progress against the challenging targets we’ve set ourselves to reduce the society’s environmental impact and I’m pleased we were able to achieve carbon net neutral status for scope 1, 2 and 3 (business travel) emissions, more than a year ahead of plan.

“With our green mortgages and tree dedications for new children’s account openings, we’ve also taken a lead in linking our products to positive environmental action.

“Housing is responsible for 16% of the UK’s total emissions, so we believe it’s important that we support our members as they seek to reduce their own carbon footprint.

“Listening to our members and colleagues, and staying close to the communities where they live and work, remains fundamental to us as a mutual, and how we’ve evolved and stayed relevant over the past century and a half.

“By the end of 2021, their passion and generosity had taken total fundraising for Dementia UK, our national charity partner, past £380,000 and I’m excited that the Closer to Home project will expand in 2022, bringing specialist dementia care to even more communities across the UK.

“That sense of having a stake in something bigger and being able to achieve success by working together shows that we’re still living the purpose for which we were founded almost 150 years ago.

“Combined with our financial security and the resilience we’ve shown through the unique challenges of the pandemic, this gives me great confidence as we look ahead to the future.”