Abbey profit up 20%
by Gill Montia
Story link: Abbey profit up 20%
Abbey has reported a 20% rise in pre-tax profit for 2008.
Consumers opened 572,000 new accounts with the bank during the year, many will have been searching for a safe place to keep their cash amid chaos in the UK banking sector.
The Santander-owned bank also announced that its share of new mortgage lending increased to 28.9% during the year, from a mere 8% in 2007.
The progress looks set to continue because during the second half of 2008 Abbey loans for house purchases accounted for 30.3% of UK net new mortgage lending.
However, the figures should be understood alongside a shrinking mortgage market; according to the Bank of England, new mortgage approvals fell by 58% during 2008.
For Abbey’s parent company, 2008 was an unusually busy year in the UK as the Spanish group completed the purchase of Alliance & Leicester in an all share deal that valued the business at £1.3 billion.
The purchase was intended to support Abbey’s plans to grow its business with small and medium-sized enterprises.
The group also acquired Bradford & Bingley’s (B&B) savings book when the buy-to-let lender was nationalised in September.
At the time, Santander took on board around 2.5 million customers and 200 B&B High Street branches.
