Leeds Building Society CEO hails landmark year

Leeds announces record profits and lending results.

Leeds Building Society CEO hails landmark year

Leeds Building Society has reported its annual results, showing 2021 was its busiest-ever year for applications and the biggest for first time buyer lending.

The UK’s fifth-largest mutual delivered a record profit before tax of £163.7 million, more than doubling last year’s figure (£80.7 million in 2020) and enabling the business to increase capital and reserves to £1.46 billion (£1.35 billion 2020).

Gross lending also grew to a record £4.4 billion, aided by an increase in savings balances to hit £15.25 billion (£14.2 billion 2020),

CEO Richard Fearon (pictured) described 2021 as a “landmark year”, adding that the Society’s record support for under-served sectors of the housing market, including 20,000 first time buyers, had been key, as it accounted for almost one in three of all its new mortgages.

“We delivered on our purpose by supporting the housing market, bringing home ownership within reach for record numbers of first-time buyers and shared ownership purchasers,” Fearon said in a statement.

Read more: Leeds Building Society delivers robust profits in 2020

He later told Mortgage Introducer that helping so many first-time buyers to get on the property ladder had been “one of the absolute highlights” for him.

“Our purpose is bringing homeownership within reach for people. That’s part of the reason we are so active and we’re leading in the shared ownership market, because that’s one way that people can get on the ladder,” he said, highlighting the fact that the Society had been named ‘best shared ownership lender’ for the sixth year running.

The Society, which has £22.5 billion in assets in the UK, also invested heavily in IT, which increased its operating costs for the year, while creating 121 skilled jobs in key areas such as IT, risk, and mortgage underwriting, and raising the minimum base level salary to £10 an hour.

Read more: Mortgage rejection could affect one in three, survey finds

The Mortgage Hub broker platform, aimed at saving brokers time, came in for a special mention as part of the Society’s drive to fast-track tech.

“We really saw the benefits of our investment in technology. It’s 76% year on year and I think that’s the biggest increase I’ve seen of any other competitors that have reported so far, and all of that kind of goes hand in glove with speeding up automating the journey and making life easier for brokers,” Fearon said, admitting that the process was “complicated, given the number of moving parts” involved.

The Society also launched preferential mortgage deals for the most energy-efficient homes in 2021, developing a carbon neutral product for other purchasers.

“Innovation has always been in our DNA. We’ve seen a really good uptake of our green mortgages and we made some really excellent progress with the targets we’ve set ourselves,” he said, adding that the Society was carbon neutral for its own emissions.

The business also moved from its historic Albion Street home to a new head office in Sovereign Street, aimed at uniting teams and providing staff with hybrid work options, including being in the office “when it’s useful”.

Looking ahead, Fearon was bullish about the Society’s prospects despite evident headwinds, revealing that mortgage application figures for this year had already beaten last year’s over the same period.

“It’s been an absolutely red-hot market - I think because rates are going up. People are (also) rushing to re-mortgage, so the market is very strong. We’re absolutely seeing that strength right here and now and I do expect that to continue.

“And from a society perspective, we have proved that we thrive through turbulent times. We have been around almost 150 years now, and that takes us through two world wars and all sorts of other conflicts. We’re strongly capitalised, we’re resilient and we will support our members through those tough times.”