Added: 19 February 2020
Ipswich Building Society 2019 Full Year Results
Ipswich Building Society has announced its financial results for the year ending 30 November 2019. Despite an ongoing fragile economy and uncertain political climate, the Society has performed well and remains focused on meeting the needs of its members for savings and mortgages.
Key numbers:
- Total profit (before tax) of £1.9m (2018: £3.3m)
- Mortgage completions of £115m (2018: £107m) with a reduction in assets of £13m to £523m (2018: £536m)
- Savings balance growth of £31m, taking overall deposits to a record £603m (2018: £572m)
- Total regulatory capital £35m (2018: £37m)
The reduction in profit is partly related to the cost of funding the higher savings balances, together with significant investment in IT infrastructure and adverse fair value movements on derivatives.
Retail Savings
Savings growth was a priority in 2019 with the strong performance enabling the Society to both repay £4m of subordinated debt* early – resulting in savings on interest payments over the next five years – and also repay £15m of Term Funding Scheme** earlier than planned.
Retail savings will continue to be a priority for the Society over the next twelve months with the ambition of developing an online savings proposition by 2021.
Mortgages
Mortgage completion levels increased in 2019 although there was a reduction in the size of the mortgage book due to a high number of planned, low margin redemptions. This has enabled the Society to focus on a high quality, low risk mortgage book.
The Society made a number of enhancements to its mortgage offering, including exclusive products for first time buyers, new Retirement Interest Only mortgages as an extension to later life deals and the launch of holiday let deals.
Intermediary partners accounted for 90% of mortgage business and the Society has embarked on a programme of widening availability through trusted networks and clubs.
Branches
A branch network remains at the very core of the Society’s proposition, with the Society being the last remaining financial services provider in Aldeburgh and Halesworth. During the year the Society refurbished its branch in Hadleigh, returning the building to its original ‘Suffolk Pink’ colouring and aptly timed to celebrate 40-years in the high street.
Through branch adoption of grass-roots charities, over £36,000 was donated through the Society’s Mutual Advantage and We Care savings accounts.
Alan Harris, Ipswich Building Society Chairman, commented on the results:
“As well as undertaking the many activities very visible to members and the community, last year much time and effort has been invested behind the scenes in our governance and oversight as this, quite rightly, remains a key focus for our Regulators. We continue to apply our Enterprise Risk Management Framework to give oversight and scrutiny of operations, finances and decision making. In short, this means taking business risks that are within appetite and ensuring they are effectively managed.
“We anticipate 2020 being another challenging environment for financial services. Activity in the housing sector is reduced and house price inflation is low, or in some areas, in decline, and we anticipate strong price competition in mortgages as well as savings in the near future. However our strength is in our simplicity and we remain focused on delivering only for our members as a strong and committed mutual.”