23 May 2017
- Nationwide is now the UK’s top choice for current accounts, opening more than any other provider1
- Third most profitable year in Society’s history, while returning £505m in member benefit
- Highest customer satisfaction among high street peer group, with 5% lead2
- £33.7bn record gross mortgage lending, while savings balances increase by £5.8bn
- Protected 5% rates on FlexDirect current account and Flexclusive Regular Saver
- Nationwide’s membership is at an all-time high at 15 million
- Won Which? ‘Best Banking Brand of the Year 2017’
A commitment to supporting the British consumer has seen Nationwide Building Society deliver record mortgage lending, become the UK’s top choice for current accounts and grow membership to its highest ever level.
Nationwide, the world’s largest building society, has achieved this at the same time as delivering its third most profitable year in its more than 130-year history, while giving £505 million in value back to members. This includes protecting products that help members’ day-to day-lives, such as maintaining the 5% interest rates on the Society’s market leading FlexDirect current account and Flexclusive Regular Saver.
Nationwide’s sustained financial strength continues despite an uncertain period for consumers in which a prevailing low interest environment continues to challenge margins. The Common Equity Tier 1 ratio improved to 25.4% (2016: 23.2%) and UK leverage ratio remained stable at 4.4% (2016: 4.4%).
Nationwide’s membership is at an all-time high at 15 million, demonstrating the attraction and strength of the mutual model to customers wanting a safe and secure place for their money.
The Society remains number one for customer satisfaction3 among its high-street peer group, currently leading by a margin of 5% over the next best financial provider and has been rated as the most trusted financial brand4.
Nationwide also demonstrated fair complaints handling, accounting for just 2.5% of all industry complaints received by the Financial Ombudsman Service. Records show that the Society judged complaints correctly in 84% of cases – the best rate of any major high street provider, with an industry average of 42%.
Nationwide’s refreshed banking app has seen usage rise significantly. In the last year, mobile log-ons grew by nearly three quarters (73%), in line with the Society’s aims to double the number of members who are active via mobile channels.
Record mortgage lending:
Nationwide lent a record £33.7 billion – more than matching the £14.7 billion lent in the first half of the year. This included the highest gross prime lending – helping a record 75,000 first time buyers purchase a home of their own – up 31 per cent against last year. This equates to £12bn in mortgage lending for those moving into their first property.
Record numbers of new current account members:
Nationwide has become the UK’s top choice for current accounts, opening more accounts than any other provider. The Society accounted for one in seven current accounts opened during the last year, opening a record 795,000. This included attracting nearly a fifth (18%) of switchers5 from other providers and, through the FlexPlus packaged account represented one in three customers for this type of product across the market. In recognition of the challenging and uncertain environment, Nationwide has continued to offer a market-leading 5% interest rate on FlexDirect at a time when other providers have reduced their current account interest rates.
Despite a continued difficult period for savers, member balances grew by £5.8 billion. Nationwide members benefitted from an average deposit rate a third higher than the market average6 over the last year. This provided members with £380 million in additional interest compared to the market average.
Following the reduction in the Bank Rate, Nationwide protected rates on a range of savings accounts designed to help people save regularly and towards a home of their own. These include the Help to Buy ISA and Save to Buy accounts, in addition to the Regular Saver and the 5% market-leading Flexclusive Regular Saver.
Branches remain a vital part of Nationwide’s plans going forward, with £80 million to be invested this financial year. In April, Nationwide opened its first branch in Glastonbury, Somerset, after the town had been left without a bank.
This branch is designed to be sustainable, blending traditional and digital solutions, including the Society’s pioneering Nationwide Now service – a high-definition video link that enables customers to take out financial products, such as mortgages and access to financial advice.
Joe Garner, Nationwide’s Chief Executive, said: “Our members have benefitted by over half a billion pounds from our commitments such as paying higher rates of interest and charging lower fees than our major high street competitors. At the same time we delivered strong profitability, robust financial strength, and continued to invest in the business. We made a conscious decision to support those saving regularly and aspiring to get onto the housing ladder and our mutual model enabled us to do this without affecting what has been a high performing year. It is the combination of that value and our focus on customer service, where we are rated number one for customer satisfaction amongst our high-street peer group, which helped Nationwide grow membership to an all-time high.
“While we saw record use of online services driven by our mobile banking app, we know that members value our branch network, which is why we are investing £80 million in upgrading branches this financial year. We have also opened a branch in Glastonbury, Somerset, which has been left without a bank, to test the viability of opening branches with community support. If successful, we may choose to invest in other communities.”
Notes to Editors:
1; For the half-year October 2016 – March 2017. Source: Nationwide Brand and Advertising tracker - compiled by Independent Research Agency. ‘Top choice’ is most considered i.e. ‘first choice’ or ‘seriously considered’ current account provider amongst non-customers, based on responses from non-customers of each brand, 3 months ending March 2017. Financial
brands included Nationwide, Barclays, Co-operative Bank, First Direct, Halifax, HSBC, Lloyds, NatWest, TSB and Santander.
2 © GfK 2017, Financial Research Survey (FRS), 3 months ending 31 March 2017 vs. 3 months ending 31 March 2016, proportion of extremely/very satisfied customers
minus proportion of extremely/very/fairly dissatisfied customers summed across current account, mortgage and savings, high street peer group defined as providers
with main current account market share >6% (Barclays, Halifax, HSBC, Lloyds Bank (inc C&G), NatWest and Santander).
3 © GfK 2017, Financial Research Survey (FRS), 3 months ending 31 March 2017, proportion of extremely/very satisfied customers minus proportion of extremely/very/fairly dissatisfied customers summed across current account, mortgage and savings, high street peer group defined as providers with main current account market share >6% (Barclays, Halifax, HSBC, Lloyds Bank (inc C&G), NatWest and Santander).
4 Source: Nationwide Brand and Advertising tracker - compiled by Independent Research Agency, based on responses from existing customers of each brand, 3 months ending March 2017. Financial brands included Nationwide, Barclays, Co-operative Bank, First Direct, Halifax, HSBC, Lloyds, NatWest, TSB and Santander.
5 Source: Independent Research Agency, eBenchmarkers, CACI, BACS Payments Schemes monthly CASS switching market data and internal sources.
6 Bank of England whole of market averages, on a 12-month rolling basis, adjusted to exclude Nationwide’s balances