Heralding ‘exciting new future’ at this year’s AGM
We were delighted to welcome a selection of members and other friends of the Society, including a number of local businesses, along to our Annual General Meeting.
And we’re particularly pleased at the positive reception they gave – not just to our financial performance, but how we plan to mould that success into our new ‘profit with a purpose’ strategy for the next few years.
In 2017 we achieved one of our best ever financial performances, with our second highest pre-tax profits in five years.
However, our new Chief Executive, Karl Elliott, introduced himself to AGM attendees and explained the important thing is how we use this strength in the future, to serve our members and the region where we are based.
“I’ve worked for mutuals like Beverley all my career so they must be a bit of a calling for me, and it’s because they’re not just about products and services and money and profits, but about offering care and support with the best intentions, and being able to make a positive difference to people’s lives,” said Karl.
“I’m really delighted to be here at the Beverley and my first few months have flown by, as I’ve got to know the Society, the town and some of the faces in the room. My observation is that Beverley is a thriving, energetic town with a real buzz about it and lots of future potential, as well as a rich heritage. I think there really is something good here that we can get involved in as a building society.”
He also explained that the Society’s financial strength and highly committed team are an ideal platform for providing more people in our heartland with the personal service and support they need to build better futures for themselves, their families and the communities they live in.
“These results are important to us, not just financially, but because of the potential they offer for us to revitalise our mutual roots, ensuring that our products, customer care and the role we play in our local community are more relevant than ever,” he said.
“Our Society was created over 150 years ago by the revolutionaries of their day – driven by their vision of making homeownership a possibility for all.
“In today’s financial marketplace, where there is ever more uncertainty; from affordable housing, to planning for later life, there is a growing need for a financial provider that is accessible and can better understand and respond to customers’ changing needs. As East Yorkshire’s only independent Building Society, we see it as our mission to do just that for people across our region.
“It’s our team of people who bring this place alive and I’m very grateful to them for being as committed as they are to the Society and our customers. They make sure that every person we deal with is treated as an individual by taking the time to listen and understand.
“It is this genuine care which will continue to make us different from others on the high street. While others are moving to more automated services, and decision-making based on algorithms, our team take the time to get to know people as individuals, and help them achieve their goals wherever possible.”
Highlights of our 2017 results:
Strong platform for growth
- Pre-tax profits were £680k, almost double 2016’s figure of £337k, strengthening reserves;
- Because the Society remains an independent mutual without shareholders, and has a policy of not paying bonuses, all of our profits will be invested into building our financial strength and resilience for members’ benefit;
- Average loan to value down to 38.4 per cent. Reduced from 39.9% in 2016, maintaining the reducing trend of the past five years as part of our low-risk lending strategy;
- Improved net interest margin, increased by 12 per cent compared to 2016 and an important factor in our improved profitability;
- Impairment provisions remain stable at 0.39 per cent of the total mortgage book (compared to 0.35 per cent in 2016). This was a result of a continued focus on low risk residential mortgages (our owner-occupied mortgages increased in value by a net £4.5m);
- Almost entirely funded by local savers’ deposits.
Meeting people’s homeownership needs
- Meeting people’s homeownership needs in line with our mutual purpose, by lending £20.3m to borrowers during 2017. Overall lending up by £1.8m, to £149.3m in 2017, compared to £147.5m the previous year. This positive increase resulted from our personalised approach to underwriting and meeting people’s niche borrowing needs – offering mortgages to those building their own homes, buying for the first time, working for themselves and borrowing in later in life or retirement;
- Supporting our East Yorkshire community
- Almost 90% of savers and over 60% of borrowers are within the East Yorkshire region;
- Fundraising for a cause close to our hearts. We continued to support Action Duchenne, raising over £60,000 for the charity helping young children with debilitating muscle degeneration leading to premature death, inspired by our Head of Operations Lesley Wegg’s son Ashley, who sadly suffers from the condition;
- Charitable donations. Members visiting our branch also voted to select ‘Charities of the Month’ from across the local region, with winners as diverse as Cash for Kids and the British Heart Foundation each receiving £250;
- Contributing to local community life. We supported popular local venues and events, including East Riding Theatre, Driffield Agricultural Show, Beverley RUFC and the Beverley Food Festival;
- Celebrating 150 years. Playing an active and supportive role in our regional community is of fundamental importance to the Society, and 2017 us marking our 150th anniversary of doing so with a garden party at our Beverley head office, attended by members, friends of the Society and distinguished guests. We also buried a time capsule on our premises with contributions from members, schools and the wider local community, with the intention of digging it up in 50 years’ time to give people a flavour of how life is today.
Prudent cost control
- One of the lowest management expenses-to-assets ratios in the industry, measured by management expenses levels compared to assets, which were 0.9 per cent or 90p in every £100 during 2017. The Society maintained one of the lowest cost bases in the industry, while continuing to invest in service improvements for our customers, including increasing resources within information technology to respond to the ever-increasing opportunities and challenges that the digital economy presents.
Karl concluded: “I feel genuinely privileged to be able to announce such a strong set of annual results during my first year as Chief Executive of this thriving organisation.
“Thanks to the outstanding customer service our dedicated team deliver, customer satisfaction and retention are consistently high. Over the coming months and years we will be seeking an ever-deeper understanding of what our current and future customers really need, so that we can remain relevant and able to meet their requirements.
“We will be seeking opportunities to further improve the products and services we provide to both savers and borrowers during 2018, with a focus on remaining relevant to families across the region who are looking for a safe and reliable home for their savings, and participating in those areas of the mortgage market where we can make a positive difference for homeowners and first-time buyers.”