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Traditional values boost Newcastle Building Society
A RETURN to traditional values has helped Newcastle Building Society raise profits and get more people onto the housing ladder, its chief said.
Pre-tax profits rose to £1.5m from £0.1m in the year to the end of December, while lending to first time home buyers rose by more than 210 per cent.
While scandals over PPI and Libor Rate fixing hit the banking sector, Newcastle, the UK's 12th largest building society by market share and assets, has performed well "by offering customers an alternative based on tried and tested principles" chief executive Jim Willens told The Northern Echo.
"In essence we are doing what we have always done; taking care of savings and lending money to home buyers," explained Mr Willens, who nevertheless supported efforts by disgraced high street banks to rebuild their reputations. "I am not a bank basher. A strong financial services sector depends upon strong banks and I want to see them flourish," he said. The mutual recruited an extra 14 staff last year to support its mortgage lending division but Mr Willens did not expect to add significantly to the some 900 staff it employs.
He said: "In 2010, we changed our strategic focus to returning the Society to a traditional building society model with a diversified income stream via our Solutions business; built on core building society competencies.
“At the heart of this strategy are our members, our staff and the communities within which we operate and ensuring we provide a good range of products and excellent service, underpinned by the society’s values.
"We are very pleased with the progress being made but there are many challenges in the wider economy so we can never become complacent."
About half of the society's 430,000 customers are based in the North-East.