Halifax sees future in savings
Wednesday 27 March 1996
Pointing to Monday's pounds 800m purchase of Clerical Medical, the life insurance mutual, as a key pointer to Halifax's strategic development, Jon Foulds, chairman, said: "The ageing population, the diminishing welfare state, the disillusionment with housing and the switch from physical to financial assets mean that savings is above all where our future lies."
He said Halifax, which is to convert to a bank next year, will concentrate on using its franchise in the mortgage market to build up personal savings. "This will be the fastest growing side of the business". At present, like all building societies, mortgage-related business accounts for around 95 per cent of Halifax's earnings.
The 1995 results were earned against a housing market characterised by weak demand and intense competition among lenders. Although Halifax maintained its position as Britain's largest lender with 19 per cent of net new business, this appeared to be slightly below its usual share.
Mr Foulds said there is increasing evidence of steady improvement in the housing market. The Halifax house price index has risen for seven successive months, and is expected to continue in March.
Mike Blackburn, chief executive, said: "We are seeing the first year- on-year positive numbers and the reports from the estate agents are significantly improved. It is too soon to be throwing our caps in the air, but the signs are encouraging."
Mr Foulds was sceptical about the usefulness of further interest rate cuts for the housing market. "Mortgages are already at historically such low levels that I don't think another fall in base rates will help much. At best it would have a marginal effect."
Halifax, which merged with Leeds Building Society in August last year, said its members will vote on conversion in early 1997, probably February. If approved, flotation will be by the summer.
Mr Foulds said this lengthy process ensured that as many qualifying members as possible would have been with the society for over two years to benefit most from the free shares distribution. There would be some 9 million shareholders.
Halifax said it was taking a pounds 113m charge for costs associated with the Leeds merger.
- 1 Cyclist who knocked down three-year-old girl says his life has been 'destroyed'
- 2 A politically correct lefty goes to see Top Gear live – you'll probably believe what happened next
- 4 Isis burns woman alive for refusing to engage in 'extreme' sex act, UN says
Cyclist who knocked down three-year-old girl says his life has been 'destroyed'
Woman accidentally shoots herself in the head while posing for a selfie
How China's richest man Li Hejun lost $15bn in an hour - and made a fortune
Isis burns woman alive for refusing to engage in 'extreme' sex act, UN says
Snoop Dogg on why he doesn't regret displaying misogyny towards women
As a white man, I'm surprised more women aren't tweeting the hashtag #KillAllWhiteMen
Scotland may have to leave the EU even if it votes to stay in, David Cameron confirms
The day that Britain resigned as a global power
SNP fury as HS2 finds 'no business case' for taking fast train service to Scotland
EU referendum: David Cameron to deny EU migrants and under-18s the chance to vote
A nation of inequality: How the UK is failing to feed its most vulnerable people
iJobs Money & Business
£40-50K: Guru Careers: We are seeking an experienced Software / C# Developer w...
£45,000 - £55,000: Neil Pavier: Are you looking for your next opportunity for ...
£45,000 - £55,000: Sheridan Maine: Are you a newly qualified ACA/ACCA/ACMA qua...
£50,000 - £60,000: Laura Norton: Are you looking for an opportunity within a w...