TIDM10AI
RNS Number : 3275W
Principality Building Society
01 August 2018
Principality Building Society Interim Results Announcement for
the six months to 30 June 2018
Principality invests in the future as its business grows
Principality Building Society has announced good half-year
results as the strategy of growing its core mortgage and savings
business continues to deliver. Its net residential mortgage lending
increased by GBP340.3m in the first six months of this year,
bringing total assets to GBP9.6bn.
To support the growth in its lending the Society grew its
savings by GBP309.3m. Its savings products have maintained its
position as one of the best and most competitive on the High
Street.
Underlying pre-tax profit, which reflects the true trading
performance of the business, was GBP27.4m (June 2017: GBP29.5m).
Statutory pre-tax profit was GBP24.9m (June 2017: GBP31.8m). Almost
eight out of 10 (79.2%) of Members would recommend Principality to
other people. This promoter score is market leading and double the
average in the financial sector.
Steve Hughes, Chief Executive of Principality Building Society,
said: "I am proud of the performance of my colleagues in the first
six months as our customer service continues to make us stand out
from our competitors. Our growth was delivered against a backdrop
of a highly competitive mortgage market and uncertainty over base
rate increases and Brexit negotiations.
"As a mutual owned by our Members, we will continue to run the
business for their long-term benefit. Our strong performance in
recent years will allow us to make significant investment in our
technology, our branches and our people. We need to do this to meet
the demands of our current and future Members. As we have already
communicated, this investment will result in profits reducing over
the next few years but it is the right long-term decision and our
strong capital base affords us that opportunity.
"We remain committed to the High Street in Wales and the
borders, while major banks have withdrawn. For us to maintain our
presence it is important our Members continue to use their local
branches and recommend us to family and friends so we continue to
grow our Society. We have actually seen branch transactions
increase in the first six months of the year. We know our members
value our great personal service and we will continue to provide
that, I'd just love more people to experience it."
Principality colleagues have yet again put in considerable
effort with their community work, raising more than GBP86,000 for
its three chosen charity partners (Llamau, School of Hard Knocks
and Cancer Research Wales). The Society has now raised well over
GBP300,000 in the past two and half years for its three
charities.
Principality also invested GBP44,000 to support more than 50
community groups and school projects across Wales. More than 1,200
schoolchildren were helped through activities, including financial
education workshops. The Society sponsored more than 200 students
to complete the London Institute of Banking & Finance L2
qualifications, which are the equivalent to a GCSE.
Steve said: "Supporting our local communities and helping them
prosper is what we do as a mutual building society. I am very proud
of the efforts our colleagues have made to improve the lives of
others. Our people are our most important asset and make us stand
out in the finance sector. We encourage them to bring themselves,
their personalities to work. It is that which makes Principality
such a fantastic place to work. I am proud that our efforts to
create a diverse and inclusive workplace saw us named as one of the
best employers to work for in the UK this year."
Looking to the second half of the year Steve said: "We will
continue to grow in a safe and sustainable way. It is clear our
profits will be lower as we reshape and invest in our business for
the long-term. Our balance sheet is strong, with a robust capital
base and we have the resilience to withstand any economic
headwinds. Our focus is clear - we will seek to improve our core
mortgage and savings capability to meet the future needs of our
Members and customers. We will drive efficiency in the way we do
things to ensure we provide value to our Members and protect their
interests for the long-term."
Notes to Editors
Please click the following link for the full Interim report
www.principality.co.uk/InterimResults2018
PERFORMANCE HIGHLIGHTS
-- Total assets GBP9.6bn (31 December 2017: GBP9.3bn)
-- Savings balances have increased by GBP309.3m (30 June 2017: GBP366.9m)
-- Net residential mortgage balances of GBP7,115.8m (31 December 2017: GBP6,775.5m)
-- Gross residential mortgage lending for the first six months
of the year of GBP912.9m (30 June 2017: GBP814.8m)
-- Underlying pre-tax profits of GBP27.4m (30 June 2017: GBP29.5m)
-- Statutory pre-tax profits of GBP24.9m (30 June 2017: GBP31.8m)
-- 84.1% of mortgages funded by savers (31 December 2017: 83.5%)
-- Strong capital with a Common Equity Tier 1 ratio of 25.2%(1) (30 June 2017: 23.4%)
-- Arrears levels remain consistently low, with the percentage
of first charge cases greater than three months in arrears
currently standing at 0.52% (31 December 2017: 0.53%)
-- Customer Service Net Promoter Score performed strongly at
79.2%(2) (31 December 2017: 74.8%)
-- Net interest margin 1.29% (30 June 2017: 1.45%)
1. Excluding unaudited interim profits. The equivalent ratio
including interim profits to 30 June 2018 would be 26.2%.
2. Source: Based on internal survey data for 6 months ended 30
June 2018
About Principality Building Society
-- Formed in 1860, Principality is Wales's largest building society.
-- The Society is committed to supporting the communities of
Wales, with 53 branches and 18 agencies in Wales and the
borders.
-- Principality is the 6th largest building society in the UK.
-- The Society has assets of GBP9 billion.
-- Principality is committed to remaining a mutual organisation.
-- www.principality.co.uk
For more information, please contact:
Jamie Pike
Corporate Affairs Manager
Jamie.Pike@principality.co.uk
029 2077 3812
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END
IR RBMMTMBAJBPP
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