Nationwide, the UK’s largest constructing society, has doubled the quantity it has put aside for unhealthy loans and diminished the advantages that it pays to its members because it offers with the fallout from the pandemic.
Low rates of interest compelled it to scale back the quantity it pays to savers, Nationwide mentioned, because it reported first-half earnings on Friday.
“After defending savers with common deposit charges that have been greater than the market common for some years, we knew this is able to not be sustainable when the financial institution base charge fell to its lowest ever charges,” mentioned chief monetary officer Chris Rhodes.
Nationwide put aside £139m within the first half for loans that might not be repaid — greater than double its £57m provision in the identical interval final 12 months. It mentioned that, whereas the variety of debtors falling into arrears had “stayed about the identical”, that might change when job assist schemes have been withdrawn.
General mortgage lending volumes fell from £16.3bn within the first half of final 12 months to £12.7bn this time round, with the society blaming disruption attributable to the pandemic.
Whereas many banks have pushed forward with in depth department closure plans, Nationwide has dedicated itself to protecting a bodily presence in each city or metropolis the place it operates till no less than 2023.
“This 12 months has been one other big blow to the excessive avenue and the communities that rely on them. They want our assist greater than ever,” mentioned chief govt Joe Garner.
“[The branches] assist present entry to providers, a degree of social contact for our members and a way of neighborhood that’s so vital simply now.”