Yorkshire Building Society 2014 Financial Results
24 February 2015
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Yorkshire Building Society Group has today announced a strong financial performance in 2014, its 150th anniversary year, as it achieved record gross and net mortgage lending and a record core operating profit.
Gross mortgage lending totalled £7.6bn and net lending reached £2.6bn while core operating profit grew to £178.8m. The Group also retained its strong capital position, increasing its total capital ratio to 16.1%.
The UK’s second-largest building society continued to deliver on its mutual values, putting its customers, people and communities first, but today has called on authorities to do more to incentivise greater financial services sector competition for the benefit of consumers, particularly in the current account market.
“I am delighted to report another set of strong financial results for the Group.
“These results reflect our qualities as a modern mutual. We offer customers long-term value and excellent service while strengthening our financial security and ability to invest for the future.
“Our passion for customers is reflected in the 34,800 mortgages we completed during the year - including a record 8,200 to first-time buyers - and the competitive return we provided savers which beat the market average5.
“I am proud that in our 150th anniversary year we continued to deliver on the fundamental aims of our founding fathers – to help people save for the future and buy their own home. Further investment in our technology, digital capabilities and branch and agency network is designed to help us continue to deliver long-term value for our customers over the next 150 years too.
“We must acknowledge that, as well as delivering excellent products and service in 2014, we were fined twice by our regulator for previously letting customers down. We have apologised for our errors, taken action to fix those problems swiftly and decisively and reimbursed those affected, which demonstrates our absolute commitment to fair outcomes for customers.
“It is our customer-focussed approach that offers a real difference to consumers in a more competitive and diverse financial services market. However, we are frustrated that despite broad consensus on encouraging challenger institutions, there is little evidence of meaningful progress.
“The ongoing reviews into the current account market represent a unique opportunity to overcome the big banks’ self-interested resistance to change.
“The existing current account switching service has failed to tackle the dominance of the big banks and raise the quality of the current account market. The banks’ self-interested opposition to greater reform resulted in a seven-day switching service and since its introduction we believe only 3%6 of accounts have been switched.
“Switching your current account provider should be as easy as downloading an app to your phone. We urge the FCA and the new Payments Regulator to make this a top priority and commit within the next year to implementing full current account portability. Only then will consumers be able to benefit from a truly diverse financial services sector.”
Appendix 1: (88 KB) containing
1This includes a number of non-core items that are detailed in the reconciliation of core operating profits (see Appendix 1)
2Source: Average rates based on Savings stock from CACI’s Current Account and Savings Database (CSDB), currently covering 86% of the retail savings market. Data as at the last working day of October 2014.
3Source: Average of monthly Nunwood Customer Experience survey of Group customers
4Source: Nunwood 2014 annual Customer Experience Excellence study.
5Source: Average rates based on Savings stock from CACI’s Current Account and Savings Database (CSDB), currently covering 86% of the retail savings market. Data as at the last working day of October 2014.
6Based on Payments Council Current Account Switch Service monthly data since launch in September 2013 and January 2015, and Mintel estimate of number of total UK current accounts as of May 2014 as included in its report Packaged and Current Accounts UK, published in July 2014
7Excluding upgrades due to takeovers or mergers
8Source: Bank of England: Monthly amount of sterling secured on gross lending and housing associations (in sterling millions) not seasonally adjusted
9Source: Bank of England: Monthly changes of total sterling net secured lending to individuals and housing associations
10Expressed as a percentage of outstanding balances, including repossessions
11Source: Presswatch Financial from Kantar Media
12Available for Barnsley, Chelsea and Yorkshire building society customers
13Source: Financial Ombudsman Service complaints data 1 January - 30 June 2014 resolved cases.
14Source: YouGov Monthly Brand Tracker Study, July 2014
15Source: YouGov Monthly Brand Tracker Study, September 2014
Small Change Big Difference® is a registered trademark of Yorkshire Building Society. Net Promoter, Net Promoter Score, and NPS are trademarks of Satmetrix Systems, Inc., Bain &Company, Inc., and Fred Reichheld.
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