The full year figures exceeded City expectations making HBOS the third most profitable bank for 2004. The result follows a UK record when HSBC announced profits of £10.1 billion and also Royal Bank of Scotland figures where earning topped £8.1 billion.
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HBOS net lending was £18.5 billion, down from £25.5 billion as it tightened its lending rules, which resulted in the total number of cases in arrears falling by 2 per cent to 32,732.
However the total value of mortgages in arrears increased to £2.65 billion, representing 1.4 per cent of the lending book, up from 1.1 per cent.
HBOS chief executive James Crosbie said: “The increase is blamed on a controlled growth of higher margin specialist lending.”
The Mortgage Business (TMB), part of the HBOS group, has announced £3.75 billion gross mortgage lending during 2004.
Bill Dudgeon, managing director of TMB, said: “TMB played a important part in HBOS’s five brand mortgage lending strategy and despite our withdrawal from the market during 2004, we lent a significant amount in comparison to many of our competitors.
“In line with HBOS we worked to improve the LTV profile of the mortgage portfolio.”
Norwich & Peterborough Building Society reported its highest ever mortgage lending with new mortgage advances increasing by 30 per cent from £659 million to £854 million with total mortgage balances up 17 per cent on 2003. Pre-tax profits were down by 16.6 per cent to £12.2 million from £14.5 million in 2003.
Matthew Bullock, chief executive at N&P, said: “We are now well advanced with rolling out our plans to change the shape of our business away from simply providing savings and mortgages.”
