Dunfermline Building Society has reported an increase in lending of 55 per cent during 2004, representing £519 million in new mortgages, with the buy to let sector helping to bolster profits.
£369 million of the building society's lending was to individuals, and the remaining £150 million to businesses and housing associations.
Moreover, with around 10 per cent of its lending concentrated in buy to let mortgages, Dunfermline is confident of weathering any downturn in the Scottish housing market.
"2004 was a hump in the market. We don't see a huge fall. There is also still a big demand for remortgage business which we are involved in", chief executive Graeme Dalziel explained.
"We don't see a crash at all. The housing market in Scotland is underpinned by a shortage of supply, strong demand, and a high aspiration to home ownership."
Nevertheless, in spite of increased lending and asset values rising by 9.5 per cent to £2.05 billion, Dunfermline's profits actually fell over the course of the year.
Pre-tax profits dropped by 14.7 per cent to £6.94 million.
Mr Dalziel defended the profit figure, arguing, "basically the profits came down because we've put more money back into the members' kitty through product improvements and because we're investing in new technology and people. Our interest rate margin is 1.3 per cent compared with an average of about two per cent for the banks."Click here to find the best mortgage deal for you.
© DeHavilland Information Services plc