N&P reports after-tax loss following Keydata provision
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Norwich & Peterborough Building Society made an after-tax loss of £48.9m in 2010 following a pre-tax provision of £57m for Keydata investments, compared to an after-tax profit of £0.9m for 2009.
However, the lender’s pre-tax profit for 2010 was £5.1m, prior to the Keydata provision, which is up from £1.3m the year before.
Jeff Pritchard, finance and risk director at Norwich & Peterborough, says: “As these results demonstrate, Norwich & Peterborough has a good underlying business which continues to offer attractive savings and mortgages to its customers.
“The Keydata provision is a one-off event which the society has the resources to cope with.”
Gordon Horsfield, chairman of Norwich & Peterborough, says: “The society has been deeply concerned for its customers who have suffered following Keydata’s failure and is very sorry for the hardship and anxiety that has occurred.”
Keydata was a product provider whose plans were bought by some 3,200 of the society’s members between 2005-2009, before being placed into administration in 2009.
The society says it will be writing to its Keydata investors inviting applications for ex gratia payments in return for transfer of the investor’s rights in and relating to the investment.
It states the board has therefore made an “exceptional” provision of £57m in the 2010 accounts in recognition of the potential costs to the society of payments to investors and associated costs.
The results also show 1.03% of Norwich & Peterborough’s mortgage accounts were 2.5% or more in arrears, in comparison to an industry average of 1.66% for the same period.
Norwich & Peterborough has now confirmed it has entered into merger discussions with Yorkshire Building Society on an exclusive basis, after announcing last week it has been considering a range of merger proposals from a number of parties.
The board says these discussions are subject to certain pre-conditions and will take a number of weeks to complete, adding while negotiations are progressing positively, there is no certainty they will result in a merger.
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Readers' comments (1)
John | 22 Mar 2011 8:20 pm
It's the staff I feel sorry for in all this. Great that people are refunded but what about all the families that *will* be laid off if the merge happens? Just look at what has happened with Chelsea, people are being made redundant left right and centre. My granddaughter works for N&P and I worry for her now.
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