Skipton Building Society's year-end results show lending increased 8.6% in 2002 to £5.2bn.
Group assets rose 7.9% to £6.7bn and group pre-tax profits rose £213,000 to £53.4m.
The group interest rate margin is reported at 1.21% and the society rate margin at 0.91%, down from 1.07% in 2001.
Key parts of Skipton's 2002 strategy included a major restructure of its branch offering, resulting in the end of its tied relationship with Norwich Union.
In its place, an independent financial adviser from Skipton's subsidiary, Skipton Financial Services, is now available at each of the society's 80 branches.
Skipton has also repositioned its IT platform to decrease costs and lay the groundwork for further evolution of its systems to retain its market-leading position.
John Goodfellow, chief executive of Skipton Building Society, says: “The last 12 months have been another year of increasing challenge. However, even in this challenging environment, Skipton Building Society has thrived, growing both organically and by acquisition.
“One of the most demanding issues for any provider in the mortgage market is the increasing level of remortgaging by customers, but the current levels of churning cannot be sustained.
“Skipton's view is very much for the longer-term, taking the attitude that customer service will become a much stronger factor in borrowers' decisions to move lenders. This attitude is reflected in our Mortgage Discount Scheme whereby discounts are given to borrowers who have held their mortgage with the society for two years or more.
He adds: “Skipton is a strong and innovative provider in the mortgage and investment sectors, and the strategy of the Skipton Group, with its 16 subsidiaries, means its presence reaches beyond just these markets.”