Mutuals hit back as bank mistrust remains

David Cutter, the group chief executive of Skipton Building Society, made the comments as the Skipton and Leeds building societies reported strong annual results.

During 2010, Leeds Building Society’s pre-tax profit rose by 33 per cent to £42.2m, while its savings balance grew by £245m to a record level of £7bn.

The society attracted 52,000 new members during 2010, taking its total membership to a record 684,000.

The chief executive Ian Ward said: “Leeds Building Society has again delivered a very good set of financial results despite the continuing challenges for the financial services sector.

“In 2011, we plan to increase our new lending by at least 25 per cent to around £1.25bn. This will be welcomed by home buyers as we provide more capacity and choice to the UK mortgage market.

“Pleasingly, the society has maintained its strong ‘A’ long term credit ratings from both Moody’s and Fitch. Also, Moody’s issue a bank financial strength rating and ours is the highest in the sector.”

During 2010, Skipton Building Society’s group profit before tax from continuing operations was £35m, compared to £18m in 2009.

This figure excludes the one-off gain of £40m from the sale of the Callcredit Information Group in December 2009 and the profits it generated that year.

The society’s estate agency business, Connells, returned a profit of £48m despite a more challenging housing market during 2010. Skipton also reduced losses within the core mortgages and savings division, from £33m to £7m.

Mr Cutter said the society had underlined its financial strength through prudent management, “despite continued buffets from external market developments such as the Government’s austerity measures”.