Nationwide '˜committed' to branches as lending grows

Building society Nationwide has stressed that it was committed to its branch network after posting a 28 per cent increase in full-year net mortgage lending.

Nationwide has 47 branches north of the Border. Picture: Greg Macvean

The mutual, which has about 700 branches altogether and 47 in Scotland, said that in the 12 months to 4 April it lent more to help people buy their own home than since before the financial crisis in 2007.

Net mortgage lending reached £9.1 billion, helping the group hold its position as the UK’s second biggest mortgage lender behind Halifax, while member deposit balances grew to £6.3bn from £1.9bn. There was a 9 per cent year-on-year jump in underlying pre-tax profit to £1.34bn.

The statement comes against a backdrop of continued bank branch closures, with the likes of Lloyds and RBS provoking ire from customers by reducing their networks.

However, Nationwide group director Alison Robb told The Scotsman that the firm is “absolutely unequivocal” regarding its branch network and that in contrast to competitors, sees the role of these premises as clearly on the increase.

“We don’t have a closure programme,” she said. “We are absolutely committed to our network. We think it’s broadly about the right size. It doesn’t mean that we won’t open a few new ones and relocate some, but fundamentally we’re investing very heavily in our branch network. For us, branches are here to stay and we need to invest in them.”

The society also gained 129,000 customers via the Current Account Switch Service, up 38 per cent on the previous year, with its share of the current account market reaching 7.1 per cent.

Robb also acknowledged challenges ahead such as the forthcoming Brexit vote, global economic pressures and increased competition in mortgages, and the organisation warned that the latter is “likely” to lead in part to seeing profits “moderate in the period ahead”.

Chief executive Joe Garner, who took the helm last month, said: “As the results show, Nationwide is not in need of radical reform, but it is an organisation that should constantly challenge itself.”