Santander saw net mortgage lending increase to £9.8bn in the nine months to September 30th but has set aside £138m for potential credit impairments.
The bank has yet to see any deterioration in its mortgage book but said it understood the concerns of mortgage customers. The £138m is the highest quarterly provision put aside by Santander since the pandemic.
As things stand 85% of Santander’s UK lending is prime UK retail mortgages, with an average loan-to-value (LTV) of 50%.
Mike Regnier, chief executive officer of Santander, said: “Many of our customers remain worried about the impact of the cost of living, and they are looking to us to help them navigate this challenging environment.
“As one of the UK’s leading mortgage providers, we particularly understand the concerns of existing mortgage customers, first-time buyers and especially those whose fixed rate mortgage is about to come to an end.
“So we are providing advice and guidance on how households can manage their mortgage, such as exploring options around length of term.
“We are also continuing our programme of proactively contacting customers who are struggling, to offer help with managing their finances and energy costs.
“While we have seen no material deterioration in our mortgage book to date, we have increased our provisions.
“Looking ahead it is clear that the ongoing inflationary pressures, increased energy prices and impact on economic activity will mean the service and support we provide our customers and businesses will continue to be critical.”
Santander are not alone in increasing its impairment provisions. Earlier today, Lloyds Banking Group increased its provision to £668m.
