Provisions for bad debt for 1993 were cut by pounds 14m to pounds 22.3m. The society has led the field in arrears control. Its cost-to-income ratio fell for the third year running to 49.4 per cent, still above the industry average of about 42 per cent.
Mike Jackson, chief executive, said: 'We work hard to provide customers with the products and services they demand and their growing satisfaction, loyalty and recommendation makes them a powerful and free sales force.'
The society is setting up a new sales team to service professionals such as accountants and solicitors, and a coporate development unit to continue its policy of buying up mortgage books. Assets increased 13 per cent last year to pounds 4.3bn - 8 per cent due to organic growth and 5 per cent from acquisitions.
Fixed-rate loans form 40 per cent of the new business. This includes the loans bought in largely at variable rates, leaving the society free to pursue fixed-rate business without worrying about an unbalanced book. About 14 per cent of the total mortgage book is at fixed rates.
The society launched a PIB last year. Its non-retail funding amounts to 21.7 per cent, up from 20.8 per cent the previous year.
The society plans to launch a current account and start offering a telephone-based service for savings and mortgages.
Net inflow of retail funds was boosted last year by the First Class postal account that consistently topped the best buy tables. The society took 11 per cent of market share in funds, seven times the society's natural share.
John Wriglesworth, building society analyst with UBS, said Birmingham Midshires had produced an impressive set of results.
'It is heading in the right direction. It was on the danger list three years ago but now it's on the prize- winner list. Mike Jackson has turned the society around. He has put in a culture of putting the customer first, but he has not gone over the top and still calls a meeting a meeting.'