Woolwich doubles half-year profits
Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.WOOLWICH Building Society's decision not to pass on to borrowers the full cut in bank base rates since last September helped it to more than double pre-tax profits in the first half of this year.
The society, the third-largest, made pounds 88m, up from pounds 36m in the same period last year. Net interest receivable rose from pounds 197m to pounds 241.1m.
Donald Kirkham, group chief executive, said margins between rates charged to borrowers and those paid to savers had been widened.
The first-half results had also benefited from a full half-year's contribution from the Town & Country Building Society.
Woolwich, in common with other building societies, seized the opportunity to restore margins after Britain left the exchange rate mechanism. Although the base rate has fallen from 12 per cent to 6 per cent since last September, mortgage rates have not fully reflected this.
However, savers' rates have fallen steeply. The typical return on pounds 5,000 in an instant-access account has come down by more than 40 per cent since September.
Societies argue, however, that their mortgage rate increases lagged base rate rises during the recession.
Mr Kirkham defended the sharp increase in profits. Allegations that the rise was indecent at a time when pensioners had been hit by falling returns on savings and many borrowers were still struggling would be 'singularly uninformed' he said.
'Our profits last year were unduly small. You need profit to give a guarantee to investors that their money is safe', he said.
Join our commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies
Comments