Published: 27 March 2023
Darlington Building Society has announced the strongest financial performance in its 167-year history and continued to deliver good value for savers and borrowers despite the backdrop of worldwide economic turmoil.
In response to successive decisions by the Bank of England during 2022 to increase bank base rate, the Society increased rates on its variable savings book multiple times to provide members with consistently good value. In the 12 months to December 2022, the Society’s average savings book rate was 0.55% higher than the market average.
As well as excellent savings products, the Society protected borrowers by not passing on the full extent of bank base rate increases and re-positioned its mortgage standard rate (SVR) to finish the year 0.64% lower than the market average.
The Society delivered a record profit before tax of £5m, along with its highest ever total assets of £833m, securing its place among the top 20 largest building societies in the UK.
The growth was underpinned by record mortgage lending growth of £97m and growth in savings balances of £69m.
However, the Society has used its financial strength to reinvest significantly in the future of the business, while championing local communities, rewarding members, and supporting staff during the cost-of-living crisis – resulting in a core operating profit of £2.2m.
The Society donated £268,000 in grants to local good causes in County Durham, Teesside, and North Yorkshire, due to its annual commitment to invest 5% of its profits into the local communities around its nine branches. More than £660,000 has now been donated to good causes since the 5% Pledge was introduced in 2017.
In his annual report ahead of the annual general meeting on April 24, Chief Executive Andrew Craddock says: “Following the pandemic-related disruption in 2020 and 2021, I was expecting 2022 to start to see a return to more normal conditions.
“However, 2022 has again been a challenging and volatile operating environment. International supply chain disruption, and the war in Ukraine, have resulted in rising inflation, followed by the Bank of England increasing interest rates.
“2022 has also witnessed considerable political upheaval in the UK and the death of The Queen after 70 years on the throne. In the context of this environment, I am delighted with the strong performance of the Society.”
While making further investments in technology to give members greater choice, Andrew pledged that the Society remained “absolutely committed” to its branch network.
He added that the Society’s performance was a credit to the “dedication of the staff who had again risen to the challenges presented by external events”.
As part of its commitment to its rising number of colleagues, now sitting at 189, 53 more than the previous year, the Society made a payment of £1,000 to each member of staff to support them during the cost-of-living crisis.
Despite challenges getting back into the community, colleagues achieved 1,136 volunteering hours supporting and raising money for local charities, clubs and environmental schemes.
Chairman Jack Cullen said: “We will continue to optimise, not maximise, our profitability, and will maintain an exceptional level of financial strength to provide the capacity to invest for the benefit of our members.
“Members can draw substantial confidence from the fact that we have continued to show great resilience in testing times, underpinned by the mutual values of shared strength and co-operation.”
Members are invited to ask questions, voice their opinion and help to shape the future direction of the Society by voting, ahead of this year’s AGM. Voting information can be found in member packs which will be arriving on doorsteps and in inboxes this week.
To read the Members’ Review for 2022 including Summary Financial Statement, click here.