Prudent strategy proves attractive for Society Members

5 September 2008

The Society, one of Wales’ largest and most successful institutions, announces a record year for both mortgage lending and inflow of members’ fund.

Net lending surged 143% to £62m while members’ accounts grew by £77m, leading to a 15% increase in total assets which reached £607m in the year to April 30.

The Society’s prudent strategy of maintaining a high quality loan book, being predominantly retail-funded and in particular the absence of any exposure to the sub-prime market, shielded the Society from the effects of the credit crunch.

Society Chairman Mr John Farrow said, “This was another year of outstanding success and progress for the Society. In particular, unlike financial institutions who were heavily dependant on wholesale funding for their mortgage lending, we have had the financial strength to maintain our quality lending.”

Chief Executive Andrew Lewis announced an increase in pre-tax profit from £3.5m to £3.8m although stressed that due to its mutual roots it still pursued a policy of profit sufficiency as opposed to profit maximisation.

He said the Society experienced a particularly strong lending performance in early 2008 but in line with market sentiment he anticipated a slow down during the coming year.

Throughout the year the Society maintained its standard variable mortgage rate at a level below the norm and continued to offer attractive mortgage products, leading to its net increase in mortgage lending of 143% to £62m.

Mr Lewis said it’s wholly owned subsidiary Monmouthshire Independent Financial Advisers Ltd continued to grow and was enjoying record levels of business, while the Society’s new insurance broking subsidiary Monmouthshire Insurance Services Ltd had a promising start and was intent on growing its critical mass organically and via acquisition.

The Society’s move to new space within its Newport headquarters is in line to be completed this autumn while new premises in Swansea are due to be opened later this financial year.

He added that further developments would include developing its online capability and maintaining its strong community involvement through its Charitable Foundation.

Mr Lewis said, “Our vision of the future is to continue to achieve long-term sustainable growth in order to maintain the Society as a vibrant and major provider of loans and savings products within our local geographical area.”


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