Economic considerations are important to Nationwide and the Society is managed to ensure its sustainability for the benefit of both our members and our employees. We aim to be an efficient and profitable organisation in order to deliver financial security.

As a modern mutual building society we are focused on maximising the value generated for our members. We do this either through offering better rates and lower fees and charges to our members or by retaining sufficient profit to invest in development of products and services. Retaining profit also allows us to maintain and build our financial strength to ensure that our members continue to enjoy the benefits of mutuality. Because we distribute value in this way, we generally earn lower pre-tax profits than our main competitors of a comparable size and complexity: typically banks and other non-mutual organisations. Financial highlights for the year ending April 2007 (prior to our merger with Portman):

• underlying profit before tax up 24% to over £668 million
• improved efficiency (underlying cost:income ratio improving from 60.6% to 56.6%)
• an estimated £660 million of pricing benefit delivered to our members
• net residential mortgage lending increased by 77.8% to £11.2 billion in the year, a market share of 10.1%
• member savings deposits increased by £5.9 billion in the year, a market share of 8.1%