View more on these topics

A View From The floor

Building societies are currently enjoying their strongest growth period for seven years, according to a new report by KPMG.

The figures show a 14.6% increase in building society assets for 2003/2004 taking the total sector holdings to £224.8bn. This should come as no surprise to those who know the societies well. Undoubtedly, the demutualisations of the early 1990s had an effect on the sector and a period of readjustment followed, but building societies are now punching above their collective weight.

Because of their mutual status, building societies can challenge the banks on pricing as they do not have to pay out profits to shareholders. And building societies have also been successful at keeping down their management expenses. Nearly seven out of 10 societies have reduced their management expense ratios. Among the top 19 societies, the average cost per £100 of assets managed is 85p, down from 90p last year.

In addition to this, the KPMG report points out that competitive market conditions contributed to a reduction in the average net interest margin at two thirds of societies. The average margin for the top 19 societies was 1.10%, down from 1.15% last year and lower than the margins of most other mortgage lenders. The average net interest margin for converters is 1.56%.

Commenting on the findings, Richard Gabbertas, partner at KPMG&#39s Financial Services practice, says: “This marks a sound performance for the building society sector in very competitive mortgage and savings markets.”

Recommended

Cartel starts PR wing

In readiness for this October&#39s impending Mortgage Day and all the changes in the financial industry that entails, Cartel decided earlier this year to push strongly into the avenues of advertising, public relations and marketing. Marie Giovanni, 30, has been tasked with heading up Cartel&#39s marketing initiative. She says: “We are all very proud of […]

Small brokers face big issues

There are tough issues coming up for the small mortgage broker and it doesn&#39t look good for the consumer – or for anyone who values a competitive market. The concern is that small brokers (as defined by the relatively small volume of mortgage protection business they will be producing) will be a less appealing proposition […]

HBOS clarifies KFI accuracy

HBOS has confirmed that it will only guarantee the online KFIs generated via its own web-based systems. This guarantee extends across the five mortgage brands. HBOS has invested significantly in the technology deployed in each of its five mortgage brands. This has been a deliberate move in preparation for mortgage regulation on October 31. The […]

Tough times ahead for central London developers

Tough, rather than disastrous, were the words used last year to describe future trading conditions. And this has proved to be pretty much the case. Take up may have fallen by 50% over 2003, but high levels of off-plan sales in previous years have provided developers with a sizeable buffer zone to cushion any future […]

Guide

Guide: day-to-day tasks ​— can your system manage?

This guide from Johnson Fleming will take you through the required communication and also give ideas for additional actions that will ensure your auto-enrolment project is a success. As well as highlighting what is required from a system to ensure it is up to the tasks, an overview of the following is also provided: data validation; data categorisation; employee communication; opt-in process; opt-out process; produce contribution schedule; contribution reconciliation process; upload of member data to pension provider; upload contribution to pension provider; manage salary sacrifice process; enrolment process; re-enrolment process; and management of increased employee queries.