Housing boom boosts Nationwide profits

20 May 2004
Nationwide has announced that increasing demand for mortgages saw its annual profits soar by 21 per cent to £425.8 million.

The UK's largest building society reported that net mortgage advances grew 81 per cent to a record £13.2 billion over the year to April 4th. The company leapfrogged Barclays Bank to become Britain's fourth largest mortgage lender, with a market share of 12.8 per cent.

Nationwide saw annual pre-tax profits rise to £426.8 million, just two years after a decision to scrap discount rates for new customers and offer all borrowers the same rates saw the firm's share of the mortgage market slump to 3.1 per cent.

Nationwide chief executive Philip Williamson said: "This has been a truly outstanding year for the society. Our performance shows that a modern, well-run mutual can be extremely successful by putting its customers first and pricing products fairly, while still generating a healthy level of profit."

He claimed that Nationwide was "lending responsibly" and stressed that the company does not lend more than 95 per cent of the value of a home.

Mr Williamson predicted that net mortgage lending would increase at a slower pace over the next 12 months as the housing market started to cool down, but dismissed concerns about a housing market crash.

Nationwide also announced that it had performed strongly in the credit card, current account and personal loan markets over the year. New credit card accounts were up 25 per cent and current accounts by 33 per cent.