Leeds achieves robust results but sees profit and lending fall

Ryan Bembridge

February 27, 2019

Leeds Building Society recorded steady results in 2018 despite experiencing a dip in both lending and profit.

Gross mortgage lending fell from £4.1bn to £3.8bn, though the society’s mortgage balances rose by 6% to £15.8bn. It achieved £1bn of net lending, which constitutes growth twice as fast as the overall market.

The society saw pre-tax profit fall from £120.9m in 2017 to £116.9m in 2018, though Leeds blamed this on a £6.5m loss owing to the sale of its legacy Irish mortgage book to Dublin-based lender Dilosk last October.

Richard Fearon (pictured), who started as chief executive today, said: “Some of these figures are slightly down but we are pleased with them in the context of the market.

“We are the fastest growing building society this decade in terms of mortgage balances.

“The key thing is the results are in line with our plans – we are really pleased with the outcome.”

He added: “Our strategy is about helping people in less well served segments – that’s the key thing that’s been successful for us.

“If I go back to what makes building societies special it’s service, efficiency and doing the right thing.

“My goal is preserving that and making sure we are set for a digital future.”

Fearon said mortgage growth has been achieved on the back of products like its welcome mortgage, shared ownership and most critically, Retirement Interest-Only mortgages.

Leeds was the first major lender to launch into RIO mortgages in August 2018.

Fearon said this year will see the highest ever investment in the history of the society, both in terms of tech and with a new office in Leeds.

Considering so much of the society’s lending comes from brokers he said much of this investment will go towards improving the broker experience.

Longevity is the name of the game at Leeds Building Society, as Fearon is its eight chief executive in 140 years. He initially joined as chief commercial officer in February 2016, before rising to deputy chief executive in August 2018.

Having completed a 12 month handover process he has taken over from the retiring Peter Hill, who had been chief executive since 2011.

Fearon said: “I’m really proud to be only the eighth CEO in 140 years.

“I’ve inherited a business in fantastic shape. There’s a great platform for the future for the society and brokers too.”

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