Nationwide’s gross mortgage lending for the six months to 30 September was 45% up on the same period last year, rising from £12.1bn to £17.6bn and increasing its market share of advances from 10.5% to 14.1%.
Releasing its first half-year results, the building society also reported a £2.3bn gain following its acquisition of Virgin Money, which it said was because the net asset value significantly exceeded the price paid of £2.8bn.
Net mortgage lending over the period was a record £6.3bn compared to £500m in H1 2023/24, increasing Nationwide’s market share of balances to 12.6%.
The building society said net lending has been supported by its “continued focus on retention through highly competitive products provided to existing customers”.
The mortgage loan book is now valued at £210.8bn, compared to £204.5bn recorded at year end on 4 April.
Underlying profit before tax decreased from £1.262m in H1 2023/24 to £959m in H1 2024/25, while statutory profit before tax also fell from £989m to £568m over the same period.
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Nationwide said this was primarily due to the profile of interest rates over the period and its choice to offer competitive rates.
Passed peak profitability
In its half-yearly update, the society said the economic outlook remained uncertain and, due to the interest rate outlook, it expects the society has passed peak profitability.
It anticipates lower interest rates and income growth to support consumer finance and, if maintained, it should support the strength of housing market activity and deposit growth.
Debbie Crosbie (pictured), chief executive of Nationwide Building Society, said: “Nationwide delivered record first half growth in both mortgages and deposits, and record member value. Over the past 18 months, our mutual model has enabled us to provide over £3.5bn in member value, including £729mn through the Nationwide Fairer Share Payment.
“Following our acquisition of Virgin Money on 1 October, we’ve recorded a gain of £2.3bn, as the value of net assets acquired is well above the price we paid. This gain provides significant headroom to cover our investment in integration, as well as in service and value.
“Future profits generated by Virgin Money can now be used for the benefit of customers, rather than being paid to external shareholders.”
