Nationwide sees mortgage lending dip after stamp duty rush but market ‘healthy’

Building society has vowed to keep all branches open until at least 2030

Nationwide has revealed a dip in mortgage lending after homebuyers rushed to beat the April stamp duty deadline – but income has risen significantly following the takeover of Virgin Money.

The building society revealed net mortgage lending totalled £4.7bn for the six months to the end of September, down from £6.3 billion last year, which it attributed to stamp duty changes coming into effect from April, when tax relief became less generous.

This saw a rush of homebuyers hoping to complete their purchases ahead of the deadline, bringing forward transactions that may otherwise have taken place during the second half of the financial year.

Nationwide’s finance chief Muir Mathieson said the volume of mortgage applications had nonetheless remained “very healthy” throughout the latest period.

The company also pointed to the fact that more customers have switched to the building society than any other banking firm, thanks to incentives including the promise not to close branches until 2030 and a cash switch offer – as well as the ongoing Which? Recommended Provider current account service award.

Including the integration of Virgin Money – which it took over across last year– total income grew to £3.1bn for the six months to the end of September.

Despite the improvement in numbers, pre-tax profits fell from £568m last year to £486m this time around.

Part of that was down to lending out less through mortgages than previously, while also contributing was a £400m payout to members through the fairer share scheme.

Dame Debbie Crosbie, Nationwide's chief executive, said the building society was “number one for growth in mortgages and retail deposits”.

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(Getty Images)

“We’re also number one for customer satisfaction, our lead is growing, and more people switched their current accounts to us than to any other brand,” she added. “All of this, combined with the benefits of our acquisition of Virgin Money, has led to an increase in underlying profit before tax, while delivering £1.2 billion of value to our members.”

Nationwide has also taken a significant 46 per cent of the student current account market - around double the new openings from a year ago - which includes £10 takeaway vouchers and fee-free overdrafts.

The building society highlighted that their branch promise had contributed within this age group too, with more than one in ten (11 per cent) student account openings being done in-branch.

Meanwhile, the company added that a quarter (25 per cent) of the fairer share £100 payments made to customers this summer went to people under the age of 35.

Nationwide recently pledged to keep all 696 branches open until at least 2030, which includes Virgin Money locations.

Banking hubs and Post Office services have had to step into the breach as some other lenders increasingly take the decision to shut physical branches in many locations.

The building society has also recently partnered with Shout charity to provide customers with free mental health support, accessible by simply sending a text message.

“We’re using digital innovation to make mental health support more accessible and immediate, helping Nationwide customers and family members look after their wellbeing in a simple and confidential way by texting ‘NATION’ to 85258,” explained Francesca Hughes, partnerships manager for Mental Health Innovations.

“The service is available 24/7, offering support whenever it’s needed and we know that for many people, those moments often come late at night when worries can feel hardest to manage. This partnership ensures no one has to face those moments alone. It represents a shared belief that early, confidential support can make a life-changing difference.”