Bath Building Society has said focusing on specialist parts of the mortgage market helped it boost its profits and increase reserves last year, despite the continuing challenging market conditions.
The society’s pre-tax profits rose by 22.9% to £2.8m while its reserves increased by 11.5% to £21m. Assets rose by 0.95% to £272.5m and its mortgage book, which has been focused on areas such as first-time buyers in recent years, grew by 8.7% to a record of £210m. Gross mortgage lending was up by 25.1% to £38.6m. 
The society said market conditions had again proved challenging, but it continued to “weather the aftershocks of the recent financial crisis with exciting future prospects to look forward to”.
Its specialist positioning in the mortgage and savings market had allowed it to build its reserves through increased levels of profitability without increasing its risk profile, said chief executive Dick Jenkins. He also welcomed recent changes in the mortgage market.
Mr Jenkins said: “We have generated real interest through our innovative approach to lending and our commitment to helping people in Bath and further afield to buy homes.
“There has been much talk in recent days about some of the challenges that lenders are facing to meet the new regulatory standards in the mortgage market. I am pleased to say that as a lender that has always been careful to ensure that our mortgages are affordable to our borrowers; we are taking these new regulations in our stride.
“We feel vindicated that the domination of the lending market by computers is finally being challenged and that there will be a return to common sense in assessment of mortgage applications.”
He admitted that ultra-low interest rates continued to prove problematic for savers.
“Whilst we can’t buck market conditions to give savers the rates they would ideally like, the fact that our assets have grown shows that our savings products remain competitive,” he said.
“Decent values and respect for our members have been at the core of our business for generations and will remain so going forward. A very good run of results in recent years which has continued into 2013, suggests that this different approach is being appreciated by our members”.
Bath Building Society (BBS) was established in 1904 to offer savings, investments and mortgages to the local community. Today it has more than 10,000 savers, 1,200 mortgage customers and employs around 50 staff.
As well as branches in Bath, it has a presence in a number of agency offices mainly in the West of England.
