Easy Cash Loans

Posts Tagged ‘isas’

Nationwide Building Society has said its profits have been badly affected by an “unfair” amount of contribution it was made to pay for a savings protection scheme.

Pre-Tax figures from last year to April show that Nationwide profits were down 69 percent to £212m.

The building society has called the £241 million contributions as “illogical”. This was paid to to the Financial Services Compensation Scheme (FSCS) to cover its savers for up to £50,000.

Falling interest rates have also resulted in lower returns from mortgages, which were also squeezed by bad debt.

Nationwide said bad debts had caused a number of knock on effects, including a sharp rise in missed mortgage repayments, reaching £394m.

But during these disruptive times, Nationwide has said it remains strong.

Chief executive at Nationwide - Graham Beale, said the building society was the only major banking institution in the United Kingdom to not require additional capital or help from government bailout schemes.

“This reflects a combination of our naturally high capital and prudent lending practices which are the hallmark features of a strong building society,” he said.

Nationwide added that just 0.6% of its mortgage customers were more than 12 weeks in arrears – significantly less than the figure recorded by the Council of Mortgage Lenders industry - an average of 2.39% based on figures from the end of March.

Nationwide profits were also affected after the merging of the Portman, Cheshire and Derbyshire building societies.

But Nationwide felt hard-done-by regarding the FSCS’s calculations of contributions.

Mr Beale said: “We regard the fact that the FSCS charge is not linked to the level of risk posed to the financial system by individual institutions, but instead is allocated by share of the retail savings market, as illogical and unfair, producing a disproportionate outcome for the low risk retail funded institutions, particularly building societies”.

UK Price Comparison website Which4U - Compare Credit Cards, Savings Accounts, Fixed Rate Bonds, Bank Accounts, ISAs, Loans, Mortgages, Insurance, TV & Broadband and Gas/Electric bills to find the best UK deals

Technorati Tags: compensation scheme, credit cards, isas, mortgages, nationwide