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Coventry reveals profits of £36.2m

Coventry building society has revealed pre-tax profits of £36.2m fuelled by huge growth in its mortgage market share.

The Midlands mutual posted gross mortgage advances of £1.3bn, which it estimates is almost double its natural market share. Its net mortgage lending totalled £338m over the last six months, representing 12.7 per cent of net lending undertaken across the UK mortgage market as a whole.

It also revealed that 1.06 per cent of its mortgage book is more than three months in arrears, compared to the Council of Mortgage Lenders’ average of 2.49 per cent.

Coventry’s current tier 1 ratio is at 12.1 per cent, with 99 per cent of the Coventry loan book now funded by retail savings, reserves and capital – the building society is one of the few UK mutuals to continue to retain an A grade from both Fitch and Moody’s.

Coventry chief executive David Stewart says: “I believe these are excellent results, in particular as we have been operating in some of the most difficult market conditions imaginable – these results demonstrate that Coventry building society remains one of the UK’s strongest building societies.

“We are well funded, and our low cost base, solid capital position and strong asset quality will help mitigate the worst impact of the economic conditions. I am sure we have the right business model for these difficult times, and I continue to be confident for the future.”

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