Mortgage and savings balances grow despite profit decline
Principality Building Society has reported record-breaking financial results for the year ending December 31, 2024, growing its mortgage lending despite economic headwinds.
The Welsh mutual’s total assets grew to £14.1 billion, up from £12.5 billion in 2023. Retail mortgage balances increased by £1.2 billion to £10.5 billion, while savings balances rose by £1.7 billion to £10.8 billion.
Statutory profit before tax fell to £49.2 million from £60.3 million in 2023, with underlying profit before tax also dropping to £40.3 million. The decline was attributed to a reduced net interest margin, which decreased to 1.22% from 1.52%, and one-off costs linked to changes in the Society’s operating model.
The building society credited its performance to ongoing investments in technology, customer service improvements, and a continued commitment to high street branches.
We're pleased to announce record annual results for 2024.
— Principality Building Society (@PrincipalityBS) February 19, 2025
You can read about our annual results in full here - https://t.co/fiqEJU6x0O pic.twitter.com/93vhA566uz
“At a time when economic uncertainty continues to challenge households across the country, we have remained steadfast in our purpose – to build a society of savers where everyone has a place to call home,” said Julie-Ann Haines (pictured), chief executive of Principality Building Society.
The lender also reported that it had helped 8,120 first-time buyers in 2024, bringing the total number of mortgage customers to 87,558, up from 80,883 in 2023.
Principality’s commercial lending arm strengthened its partnerships with housing associations in Wales. The society provided £25 million in long-term financing to Cardiff-based Hafod, supporting the construction of 300 affordable homes over the next five years.
It also marked the completion of the final phase of The Mill in Cardiff, a decade-long project that delivered 800 homes, half of which are available at discounted, intermediate, or social rent.
“We are delivering on our ambition for better homes,” Haines said. “Access to affordable housing remains one of the most pressing challenges of our time.”
Looking ahead, Principality expects a more favourable economic environment if inflation and base rates continue to decline. However, it remains cautious about the ongoing cost-of-living pressures facing vulnerable households.
“As we look to 2025 and beyond, the society continues to be equipped to navigate the challenging economic and political landscape that we operate in,” Haines said. “We remain committed to support our members, colleagues and communities for another 165 years.”
Despite the fall in profits, Principality said its liquidity and capital positions remain strong, with a Common Equity Tier 1 ratio of 19.8% and liquidity coverage of 231%.
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