Leeds Building Society posts record profit owing to cost-cuts

Leeds Building Society has announced that its pre-tax profit climbed 58 per cent to settle at 31.7 million pounds during 2009 as compared with a pre-tax profit of 20.3 million pounds in the previous year.

Underlying profits before impairment losses and provisions were taken into account advanced 17 per cent to 80.1 million pounds during the same period.

The cost-to-income ratio, which determines how much the company must spend to generate profits, slipped from 40 per cent to settle at 36 per cent.

Society’s chief executive Ian Ward has attributed the improvement to cost efficiencies.

Speaking on the topic, Ian Ward said, “Leeds Building Society has delivered a sound performance in 2009, with rising retail balances, increased profitability and even stronger reserves.”

However, loan impairments climbed from 32.1 million pounds in 2008 to 52.5 million pounds in 2009 as the worst recession since Second World War affected borrowers' capability to return loans.

The mutual further added that it gained as many as 71,000 new members over the last year, taking the total membership to more than 680,000.