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Lenders 'will always have place on high street'
Updated 12:12pm Wednesday 30th July 2014 in Business
BUILDING societies will always have a place on the high street, despite the increase in digital services, a major lender has said.
Newcastle Building Society says its traditional branches remain intrinsic to customers’ needs as a strong compliment to its online provision.
The reassurance comes as Atom Bank prepares to open UK headquarters near Durham City next year, aiming to offer an alternative to high street lenders.
The branchless Atom bosses hope to attract online customers with revolutionary innovations, such as paperless cheque deposits, allowing people to email pictures of cheques to be deposited.
However, Jim Willens, Newcastle Building Society’s chief executive, told The Northern Echo it had always placed great importance on its digital offering, which is giving customers what they wanted.
He said that stance was enhanced by Newcastle’s position as one of the first building societies to offer an online savings account.
He said: “Our members have a number of ways they can use our services.
“Some like to use our branches, others the telephone service, and some our internet offering, which we have done for a number of years.
“They like to have that choice, and what we hear a lot is how they look at the products, give us a call and then come in to look someone in the eye.
“That mix is very successful.
“There will always be a place for people who want to deal with people, but we are very committed, and have been for a number of years, to our online services.”
Mr Willens was speaking as the lender revealed its half-year results to June 30, which showed pre-tax profits of £0.8m, compared to a restated pre-tax loss of £0.8m for the six months ended June 30 2013.
The firm said profitability was affected in the first half due to changes in accounting for the Financial Services Compensation Scheme levy, with the annual charge of £2.4m recognised in full on April 1.
It also said operating profit before impairments, provisions and exceptional items lifted to £5.9m, with the number of mortgages in arrears by three months or more below industry averages at 0.59 per cent.
Mr Willens added: “We are continuing to make steady progress.
“The recovery in the UK economy appears to be more firmly established and there are encouraging signs this is set to continue with higher economic growth supported by rising business and consumer confidence.
“The housing market continues to show signs of vacillation; just as the market looks to be recovering there are concerns it may be overheating, while some commentators suggest the Mortgage Market Review (MMR) has started to have a dampening effect.
“For us, MMR had little impact as we have completed an affordability assessment for borrowers for several years and it’s pleasing we’ve seen activity increase post-MMR.”