West Brom mortgage lending and profits grow - but Merry Hill branch to shut
The West Bromwich Building Society has reported a 38 per cent increase in its new mortgage lending for its latest financial year - but has announced that its Merry Hill shopping centre branch is to close.
The society, which has its headquarters at Providence Place, saw the lending grow from £569 million in 2019-2020 to £784m in the 12 months to the end of March this year.
The West Brom's pre-tax profit also improved from £1.5m to £4.7m even after absorbing a significant impact from the potential economic consequences of the Covid-19 pandemic lockdown.
Its branch at the Merry Hill shopping centre in Brieley Hill is to close at the end of August before the lease runs out in September.
The society, which has 36 branches, had £1.2 billion of new applications in 2020-2021 compared to £900m a year before,
One in three of all new mortgages helped support first-time buyers and the society rewarded savers with rates that were, on average, 41 per cent above those paid by the market, equivalent to an additional £5.3m in interest.
It maintained its strong capital position and total assets rose from £5.57bn to £5.76bn.
Chief executive Jonathan Westhoff said the society had delivered a "robust performance" and throughout the pandemic the West Brom had been determined to deliver its purpose, centered on the promotion of home ownership.
"Whilst at the start of the pandemic we took a responsible approach by limiting the amount of high loan to value lending, in total a third of our new mortgage lending has been to first-time buyers. This segment is at the heart of our purpose, and we have recently launched a range of 95 per cent loan to value products to provide more options for those looking to achieve the dream of home ownership," he explained.
Pandemic
"The pandemic has highlighted the benefit of our mutual ethos and enabled us to focus our efforts on supporting our members when they needed us most. We have reconfigured our business model in ways that would’ve seemed impossible under ‘normal’ circumstances, providing much more flexibility and agility that ultimately provides greater support to our members," he added.
Supporting the most financially vulnerable had been a key priority.
"Many members were worried about their financial stability through the pandemic, and the society responded swiftly, developing a quick and easy online portal to apply for a mortgage payment deferral period, enabling 5,570 deferrals in total. We’re pleased to see that 99 per cent have already resumed payments, and for those who are still experiencing financial difficulty, we have created a dedicated team who can apply a range of measures to help borrowers get back on track.
"One group that has been hit hard by the pandemic is savers. That said, for many the impact of the pandemic will have reaffirmed the importance of having a savings buffer, and the society has welcomed 4,513 new savers," said Mr Westhoff.
The society did not place any of its more than 700 staff on furlough and has not made any redundancies as a result of the pandemic or reduced pay even when there has been a reduction in working hours.
"We have supported home working throughout and will continue to apply agile working following the pandemic, as it is evident that our business model can successfully adapt to accommodate more flexibility," added Mr Westhoff.
Reviewing
The society has been reviewing its customers’ needs and demands for our services within the branch network.
Both Merry Hill and Birmingham, which also has a leases that ends in September and will also be closing, have high operating costs and are predominantly used as secondary to the member’s main branch.
"We have written to customers informing them of the change and we are still operational in these branches until the end of August," said Mr Westhoff.
The society continued to support good causes in the year including a £34,000 donation to local food banks, as well as donations to West Midlands Air Ambulance and Birmingham Children’s Hospital. Many staff supported key workers with care packages delivered to hospitals around the Black Country, for both patients and NHS staff.
"As we seemingly are moving into the ‘post-pandemic’ world, we know there will be more challenges this year as we return to a form of normal. If we have learnt anything from the past 12 months, it is how resilient the society is, which is largely down to the commitment and hard work of colleagues, and how we can provide the benefits of mutuality to our members to support them during the most unprecedented times.
"We have confidence that the society is in a strong position to weather any future challenges, and this year we will continue to make decisions with our saving and borrowing members at heart," Mr Westhoff stressed.
