Nationwide hit by mortgage loan crackdown despite first quarter profits rise
Nationwide’s profits more than doubled in the first quarter of its 2014 financial year, the building society said yesterday.
But its mortgage lending volumes were hit hard as tougher new rules came into force in April.
Gross mortgage lending came in at £5.8bn in the three months from April to the end of June, down 9.3 per cent on the year.
The building society had a strong first quarter last year when it was better placed than many rivals to take advantage of the start of the housing recovery.
By contrast, it was slowed this year by the mortgage market review rules. These force lenders to carry out more detailed affordability checks on buyers, delaying loans and so hitting the figures.
Profits came in at £253m for the three-month period, up 141 per cent from the £105m recorded in the same quarter of 2013.
Nationwide’s cost-to-income ratio fell from 62.8 per cent to 51.5 per cent, helping profitability.
Member deposits edged up 1.1 per cent to £132bn.
And it gained share in the current account market – it now has 6.4 per cent of all UK accounts, up from 6.2 per cent three months ago.