Yorkshire Building Society lent 9.2 per cent less to mortgage borrowers in 2015 than it did the year before.
Its annual results show it lent £6.9bn to borrowers in 2015, down from £7.6bn in 2014.
Net lending also fell, from £2.6bn in 2014 to £1.1bn last year.
The proportion of its loans in arrears of more than three months (including repossessions) fell from 1.21 per cent in 2014 to 0.96 per cent last year.
The society reported a £173m pre-tax profit last year, down 7.9 per cent from the £188m reported a year earlier.
Yorkshire Building Society chief executive Chris Pilling says: “Interest rates have remained at historically low levels for mortgages and savings customers and competition within the market has become even more intense. As a result, during the year we proactively reduced our lending and funding targets to reflect our commitment to long-term financial sustainability whilst continuing to offer extremely attractive mortgage and savings products. This included launching our lowest ever fixed rate mortgage and helping customers save for their futures with the opening of 166,000 new savings accounts.”