by Mark Johnston
Nationwide Looks set to Become One of the UK’s Big Lenders.
It currently appears that the Nationwide building society, which is Britain’s biggest customer owned financial service group, looks likely to surpass Barclays in terms of gross lending in 2012.
This would therefore make it the third biggest UK lender after Santander and Lloyds Banking Group. They are competing with the likes of the Royal bank of Scotland (RBS), HSBC and Barclays in the financial service sector.
During this period the building society lent approximately £2.5 billion to 20,000 first time buyers, this was double the amount they lent to first time buyers in the previous year.
Figures show that this is the building society’s highest level of lending in four years.
Building society Nationwide said its mortgage lending soared to a four year high as the Bank of England’s £80 billion scheme helped reduce rates for borrowers.
Therefore these lending figures should make for encouraging reading at the bank ofEnglandwho jointly launched with the treasury the ‘funding for lending’ scheme earlier this year.
Industry experts say that these figures are evidence that the ‘funding for lending’ scheme is having an effect on lending.
Some other experts feel Nationwide have more than played their part in supporting the UK’s economic recovery by increasing their lending activities, with their gross mortgage lending increasing 15 per cent to £10.2 billion.
Graham Beale, chief executive at Nationwide, commented: “At Nationwide we have continued to demonstrate our success, living up to our promise of being on the side of our customers. Our ongoing focus has paid off, and I am delighted that over the first half of the financial year we have been rated as top of our peer group for combined product service satisfaction.”
Their lending strategy remains largely unchanged from previous years as they believe it is a successful and sustainable strategy that provides them with the ability to adapt to changing market conditions. It seems then that their success is based on a long term strategy of delivering value to their members through consistently excellent products and services.
Their curent plan focuses on the following objectives:
– market positing
However, Nationwide has said that its pre tax profit has fallen by 50 per cent in the six months to the end of September, despite them seeing a sharp rise in the number in new customers.
The slump has mainly been due to the cost of compensation for the rising level of payment protection insurance (PPI) claims. The building society has had to set aside a further £45 million for the claims.
Although this figure is still a fraction of the costs incurred by many of the other big lenders.
This all said it still appears that the building society has positioned itself as one of the ‘so called’ challenges to the mainstream high street banks.
Related stories to : Nationwide Looks set to Become One of the UK’s Big Lenders.