Nationwide Building Society has given the UK’s listed banking sector a lift after reporting a 30% rise in annual profits and upbeat comments on its outlook.
The mutual posted pre-tax profits of £2.3 billion for the year to the end of March, up from £1.8 billion a year earlier, despite returning a record £2.8 billion in value to its members.
That included a £1 billion payout in rewards, with another round of £100 payments going out to eligible customers next month.
The results come on the back of a strong performance at Virgin Money, which Nationwide acquired last year in a £2.9 billion deal.
Virgin delivered £15.5 billion of net lending and helped lift savings balances by 35% to £260.7 billion. The integration is “progressing well” and the mutual has kept both workforces and operations running separately for now.
Chief executive Debbie Crosbie said it had been an “outstanding” year, marking record growth in mortgage lending and deposits.
The update from one of the British high street's biggest lenders had a knock on effect for the quoted banks, with the sector index up 1.3% and outperforming the wider stock market.
Lloyds Banking Group PLC (LSE:LLOY), which has the biggest retail presence of the group, was up 1.1%, while Barclays PLC (LSE:BARC) was up 1.5%.