Coventry Building Society has reported a drop in annual profits as lower mortgage costs and shifting savings habits hit its income.
The lender, which recently began merging with The Co-operative Bank after acquiring it earlier this year, posted a pre-tax profit of £323 million for 2024, down from £474 million in 2023.
The decline was driven by falling mortgage costs as UK interest rates eased, reducing the society’s net interest margin - the gap between what it earns from loans and pays to savers.
Meanwhile, customers moved their savings into higher-interest accounts, putting further pressure on earnings.
Despite this, Coventry Building Society grew its mortgage and savings balances, helped by competitive rates and incentives to encourage saving.