Nationwide Building Society has posted a £5.5bn growth in gross mortgage lending in its results for the six months between April and September.
During the period, the mutual lent £18.2bn, up on its pre-pandemic figure of £16.3bn in 2019. Compared to the six months to September last year, this was also an increase on the £12.7bn posted.
Over £5bn of mortgages lent during this period went to first-time buyers, which the mutual said was supported by its Helping Hand product and a return to 95% loan to value (LTV) lending.
Some 29% of new mortgages were issued to first-time buyers, up from 27% last year. Meanwhile, home movers accounted for 34%, up from 21% in the six months to September 2020.
Despite the growth, Nationwide’s mortgage market share contracted to 11.4%from 12% annually. It said the market was larger and “highly competitive” due to pent-up demand and the stamp duty holiday.
Nationwide reported a rise in underlying profit to £850m against £305m last year, and statutory profit increased to £853m from £461m.
It attributed this to higher margins on mortgages and the release of £34m in credit provisions. However, it warned that its mortgage margins could be impacted by the competitive market going forward, also affecting profitability.
Chris Rhodes, chief financial officer at Nationwide Building Society, said: “During the pandemic, strong demand for mortgages, coupled with macro-economic uncertainty, led to higher margins on mortgage lending.
“This resulted in significantly higher income, and a very strong overall financial performance. Net interest margin improved, but is unlikely to be sustained at this level in future due to intense competition in the mortgage market.”
