Yorkshire's results include a pounds 500,000 provision to cover the costs of compensating investors who have lost out through dealing with its financial advisers.
David Anderson, general manager (corporate development), said an adviser in the society's Swansea branch had 'gone off the rails', issuing unauthorised guarantees of investment performance and failing to invest clients' money as intended. Yorkshire believes only 20 or 30 investors are affected.
The building society also has a small exposure to the problems with personal pension transfers, which are under investigation by the Securities and Investments Board, the senior financial regulator. Mr Anderson said Yorkshire had accepted 370 pension transfers, though none from a current occupational pension scheme.
Yorkshire has talked with consultants and potential joint venture partners about setting up its own life insurance company, following the lead taken by many of the largest banks and building societies. Tony Smith, general manager (finance), said this was 'the main item on our agenda this year'.
Sales of insurance and investment products, together with administration fees and mortgage application charges, earned Yorkshire pounds 33.9m last year. Mr Anderson said about pounds 5m of this was life insurance, pensions and investment business. Of this, only about a quarter is mortgage-related.
Yorkshire's profits were aided by a 20 per cent fall in bad debts, reflecting significant falls in arrears and repossessions. It said its post- tax return on assets of 0.91 per cent was the highest so far reported in 1993 by a large building society.
Assets grew more than 10 per cent to pounds 5.35bn. Yorkshire said last year's mortgage lending of pounds 850m gave it a market share 44 per cent above its industry asset share.
Net retail receipts last year amounted to pounds 223m, or 10 per cent of the industry's total.