REG - Yorkshire B.S. - Half-year Report
24/07/2025 08:15
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RNS Number : 2859S Yorkshire Building Society 24 July 2025
Yorkshire Building Society
Half-Yearly Financial Report 30 June 2025
Interim Management Report
Introduction from the Chief Executive
I am pleased to present the 2025 Half-Yearly Financial Report for Yorkshire
Building Society.
Our purpose is to provide Real Help with Real Life. We exist for you, our
members and customers. We will continue to ensure we deliver good value for
you.
Strong Financial Performance
In the first six months of 2025 we delivered increased income and profit
resulting in strong capital generation. Our robust levels of capital and
liquidity, coupled with the investment we are making in our future
capabilities, will enable us to continue to support our members, customers,
their families, and our communities, now and in the future.
We have increased the overall balance sheet in the first half of 2025, however
increased competition in our core markets of savings and mortgages has
impacted levels of growth.
· Core operating profit(1) £215.4 million (Period to 30 June 2024:
£149.2 million)
· Statutory profit before tax £187.9 million (Period to 30 June
2024: £158.1 million)
· Net interest income £429.6 million (Period to 30 June 2024:
£340.8 million)
· Net interest margin 1.31% (Period to 30 June 2024: 1.09%)
· Overall balance sheet growth £0.4 billion (Period to 30 June
2024: £2.9 billion)
· Mortgage balances grew by £0.9 billion (Period to 30 June 2024:
£2.0 billion)
· Savings balances decreased by £0.3 billion (Period to 30 June
2024: £2.6 billion growth)
· Common Equity Tier 1 ratio 18.5% (31 December 2024:18.1%)
· Liquidity coverage ratio 228.5% (31 December 2024: 202.7%)
Despite heightened competition and economic uncertainty, we have seen an
increase in mortgage applications, with Q2 mortgage applications significantly
higher than Q1.
Our Strategy
Our Strategy is designed to deliver against our purpose. I'm delighted to
share the progress we have made against our four strategic pillars in the
first half of the year.
1. Double Our Reach and Deepen Our Impact
As a building society, all the profits we make are reinvested for the benefit
of our members and customers. We invest them into providing products that
overcome real-life challenges, supporting our communities, and improving our
Society. We are determined to help more people to find a place to call home
and build their financial wellbeing, whilst deepening our relationships with
our members and customers.
We continue to look for innovative ways to make owning a home a reality.
· So far this year, we have provided more than 18,000 mortgages,
with nearly 4,000 going to first-time buyers.
· Since launch, our £5k Deposit Mortgage, has helped over 1,400
people into their first home. In February we extended this mortgage to flats,
helping even more customers onto the property ladder.
· When stamp duty rates increased in April, we increased our
cashback offering for first-time buyers up to £6,250 to help with the added
costs of buying a home.
· In response to updated guidance from our regulators we increased
the maximum amount we will lend by £16,000 on average, to help borrowers
overcome affordability challenges, at all times ensuring the mortgage is
affordable.
1 Profit earned excluding taxes, fair value volatility and one-time charges.
We are committed to supporting our members build their financial resilience.
· We have grown our membership and seen 288,000 new savings
accounts opened.
· Our savings rates were on average 0.63 percentage points higher
than the rest of the market and, despite base rate reducing by 0.5%, we
returned an additional £132.2 million to our savers in the first five months
of 2025(2).
· We offer life and home insurance without taking commission. In
just six months our customers saved more than £1 million on their home
insurance premiums(3).
· We continue to reward our loyal members. Our Reward ISA was
designed for them. Its automatic maturity option means customers
effortlessly access good value as soon as their product ends, without the
inconvenience of transferring products or opening a new account.
· Our members value the option of a Cash ISA to save for life's
important moments. That's why, alongside the Building Societies Association,
we used our voice to highlight the impact that a reduced allowance would have
on our members' financial wellbeing. We will continue to represent the views
of our members to government and key policymakers.
We fund local and national community programmes that tackle some of the main
causes of hardship, such as financial education and employability skills.
· Our partnership with FareShare continues to change lives. So far
this year, the programme has helped 659 people build skills for the future and
since the partnership began 105 have gone on to secure paid employment.
· Our Building Bradford Skills Fund will provide £1 million to
four charities delivering employability projects in Bradford. Bradford Central
Foodbank, Lower Grange Community Association, The Cellar Trust, and Smart
Works are helping improve individuals' job prospects while providing a talent
pipeline to support the city's future.
· In this volatile and uncertain time, cost-of-living pressures
persist. As a result, there is increasing demand for the free, confidential
appointments we offer with Citizens Advice in 44 of our branches. Advisors
offer support to everyone, not just members and customers, on topics like
overcoming debt. So far this year, we have helped 3,039 people who together
could be nearly £1.9 million better off if they act on the advice given.
2 YBS Group average savings rate compared to rest of market average rates.
Data source: CACI's Current Account and Savings Database (CSDB), Stock. Data
period: January - May 2025 (latest data available).
2. Create Joyful Experiences
However you choose to interact with us - whether that's online, over the phone
or through our national network of branches and agencies - we want it to be
simple and stress-free.
· We continue to develop digital functionality so members can
manage their money in a way that is convenient for them.
· Customers can now open all our online products within our app.
This ISA season, one in three customers chose to open an ISA via our app.
· Regular payments can now be managed in our app.
· We have significantly improved our mortgage broker portal, making
applications quicker and simpler for brokers and customers.
We know our customers want us to make it even easier for them to manage their
accounts online. We have listened to feedback that our payment processing
times are too slow. We are working hard to deliver same day payments while
taking the time needed to make sure we protect the safety and security of our
customers.
Our progress within this strategic pillar is reflected in our Net Promoter
Score, which has increased to +66 (30 June 2024: +64)(4). I am delighted that
even more of our customers would recommend us to their friends and family.
Our customers consistently praise our colleagues for the brilliant service
they provide. Their human touch makes the difference during important life
moments. I am grateful to all our colleagues for their hard work and
commitment every day.
3. Ambitious Culture
Our colleagues are the heart and soul of our Society. When we align around a
common purpose, work together, and move at pace, anything is possible.
Every three months, I choose the winners of my CEO Awards, recognising
colleagues who role model our behaviours. Celebrating our colleagues'
successes and inspiring others through their impact are highlights of our
year.
Our focus on future-ready skills will set our colleagues up for long-term
success and support our Society to grow and prosper.
Skilled, diverse workforces are more innovative, engaged, and productive. We
continue to focus on increasing the number of women and ethnically diverse
colleagues in senior roles, and other measures of diversity as part of our
wider Diversity, Equity & Inclusion Strategy.
3 In first six months of partnership with Uinsure, 28 November 2024-22 May
2025.
4 Net Promoter Score and NPS are trademarks of Bain & Company, Inc., Fred
Reichheld and Satmetrix Systems, Inc. Data period January - June 2025, based
on 8,473 responses.
4. Building a Future-Ready Society
Our final strategic pillar focuses on ensuring the Society remains resilient
and sustainable for generations to come.
We are investing significantly for the benefit of our members. The
proof-points within the other strategic pillars demonstrate this. From
improving processes and digital functionality to developing innovative
products, we are driving shifts in the areas that make the biggest difference
to our members and customers.
We continue to strengthen our governance, risk, and control. Investment in
these areas is critical to our long-term success and will ensure members'
interests are protected as we grow.
When looking to the future, we also consider our environmental impact.
· We are committed to supporting the UK's transition to a
low-carbon economy. This year, we created a Board-level Environmental and
Social Purpose Committee to ensure we apply leadership and focus to this
important topic.
· Our partnership with Snugg helps customers understand the energy
efficiency of their home. We are exploring how we can go further to help them
complete upgrades that will reduce their energy use.
· We continue to work to improve the efficiency of our own
operations. I am pleased that the solar car ports at our Bradford head office
are now complete and in use. We expect them to reduce our carbon emissions by
over 100 tonnes a year and save more than £100,000 in electricity bills.
Growing Our Society and Protecting Members' Interests
Our plan will grow the business safely and sustainably, protecting members'
interests and investing in our Society. As we grow, we will help even more
people build financial resilience and find a place to call home.
I am proud to lead such a strong and purposeful business with a clear focus on
delivering value to our members. My team and I remain committed to helping
members and customers achieve their life goals, and ensuring the Society
provides Real Help with Real Life for generations to come.
Thank you for your continued support.
Susan Allen, OBE
Chief Executive
Performance at a glance
Member value
Statutory profit before tax Core operating profit(5) Cost to core income ratio Common Equity Tier 1 ratio
£187.9m £215.4m 47.8% 18.5%
£158.1m 30 June 2024 £149.2m 30 June 2024 53.1% 30 June 2024 18.1% 31 December 2024
This is the profit we earned from our ongoing business operations, excluding This is the profit we earned, excluding taxes, fair value volatility and This ratio is a measure of efficiency, showing how much we are spending to Maintaining this ratio above a certain minimum helps to protect the Society
taxes. one-time charges. generate every pound of our income. against unexpected losses.
UK Leverage ratio Liquidity coverage ratio Average savings rate differential(6) Net Promoter Score (NPS®)(7)
6.9% 228.5% 0.63pp higher than the market +66
6.6% 31 December 2024 202.7% 31 December 2024 0.90pp higher over 2024 +64 in 2024
This ratio highlights the capital we hold compared to our assets, showing our A liquidity metric which aims to ensure that an adequate level of liquidity is This shows how much higher the rates we paid our customers were compared to This measures how willing our customers are to recommend us to others.
ability to cope with unexpected events. maintained to meet a severe, 30-day stress scenario. the rest of market average.
Place to call home
Gross lending Gross mortgage lending market share(8) Growth in mortgage balances(9) New residential mortgages provided
£4.3bn 2.9% 1.7% 18,000
£5.2bn 30 June 2024 3.8% 31 December 2024 4.3% 30 June 2024 23,000 30 June 2024
This represents the amount we have provided to customers to help finance This represents our share of all mortgage lending in the UK housing market. This represents the growth in our overall mortgage balances over the period. The number of new residential mortgages advanced in the period, helping our
properties over the period. customers to have a place to call home.
Financial Wellbeing
Savings accounts opened Savings balance market share(10) Movement in shares balances Average savings rate paid(11)
288,000 2.5% -0.5% 3.78%
290,000 30 June 2024 2.5% 31 December 2024 5.5% 30 June 2024 4.21% over 2024
The number of accounts opened by new and existing members over the period, This reflects our share of the UK savings market. This shows the total deposits from members. We use these balances to fund the This shows the benefit we are giving back to our members.
helping them save for the future. mortgages we offer to our customers.
More detail on business performance can be found in the Business Highlights on
page 6.
5 Definitions of alternative performance measures are provided in the glossary
for the 2024 Annual Report and Accounts.
6 YBS Group average savings rate compared to rest of market average rates.
Data source: CACI's Current Account and Savings Database (CSDB), Stock. Data
period: January - May 2025 (latest data available). Comparative period:
January - December 2024.
7 Net Promoter Score and NPS are trademarks of Bain & Company, Inc., Fred
Reichheld and Satmetrix Systems, Inc. Data period January - June 2025, based
on 8,473 responses.
8 Based on Bank of England total industry gross lending. Data period January -
May 2025.
9 Growth in mortgage balances excludes fair value adjustments for hedged risk
on loans and advances to customers.
10 Source: YBS analysis of BSA Household savings. Data period: January - May
2025.
11 Source: CACI's Current Account and Savings Database (CSDB), Stock. Data
period January - May 2025.
Business highlights
This section provides a brief overview of the key activities of Yorkshire
Building Society ('YBS' or 'the Society') and its controlled entities
(collectively 'the Group' or 'YBS Group') in the first six months of the year,
as well as updates on the environments in which YBS operates.
Economic environment overview
In the first half of 2025, the UK economy has experienced modest growth with
Q1 gross domestic product reaching 0.7% (2024 Q1: 0.7%) followed by two months
of modest declines. As a result, the Organisation for Economic Co-operation
and Development has revised its 2025 growth forecast down to 1.3%(12). This
revision reflects the increasing challenges stemming from global trade
tensions, inflationary pressures, and fiscal constraints. Notably, the impact
of US-imposed tariffs has disrupted international trade systems, affecting UK
exports and levels of business confidence. On a more positive note, recent
trade agreements reached with the EU, US, and India provide some increased
cause for optimism.
The rate of inflation has increased during the period, from 2.5% in December
2024 to 3.6% in June 2025, and is projected to peak at 3.7% in Q3 2025,
primarily due to higher utility prices. Although this is a significant fall
from the peak of 11.1% in Q4 2022, the cost of living remains a significant
challenge for many UK households. The consensus view among economists is that
the rate of inflation is likely to fall back in line with the UK Government
target of 2% at some point during 2027.
Interest rate expectations have been particularly volatile, due to both
persistent inflationary pressures and broader geopolitical uncertainty. The
Bank of England reduced Bank Rate by 0.50% to 4.25% during the period, with
further reductions likely, though the scale and timing of these remain
uncertain and are heavily influenced by the US position on tariffs and the
global action taken in response.
In the UK labour market, the unemployment rate has increased modestly this
year, and whilst wage growth remains robust, in real terms wages remain lower
than pre-cost-of-living crisis levels.
12
https://www.oecd.org/en/publications/oecd-economic-outlook-volume-2025-issue-1_83363382-en.html
The UK mortgages market
Overall, the UK mortgage market in 2025 so far reflects a cautiously
optimistic environment, with an increase in lending activity being supported
by a combination of lower interest rates and a relaxation of affordability
criteria. During the period, the FCA published updated guidance permitting
lenders to assess customer affordability using the rate the customer is most
likely to revert to at the end of their existing product term, allowing the
use of product transfer rates rather than reversionary rates. This led to a
number of lenders, including a number of the biggest lenders, to adjust their
affordability assessments, increasing the average borrowing capacity for
customers.
Market mortgage rates across both residential and buy to let sectors have been
on a steady downwards trajectory this year, following a similar reduction in
swap rates driven by easing inflationary pressures and concerns over economic
growth.
2025 has seen heightened competition and margin compression across the market.
Falling interest rates have improved affordability allowing customers to
explore a broader range of options when their fixed rate term comes to an end.
In this market context, YBS has further developed its purpose-aligned
propositions by extending our '£5k Deposit Mortgage' proposition to flats.
This is expected to be particularly beneficial for people in areas like London
and the South East. We also further extended our Cascade Score proposition to
borrowers purchasing a new build property up to 90% loan to value. Cascade
Score helps borrowers with a smaller deposit to secure a mortgage where they
may previously have been declined. Following the change to stamp duty
thresholds, we introduced a number of products with a cashback of between
£2,750 and £6,250, designed to offer help to first-time buyers who may as a
consequence of this change, struggle with their cashflow following the
completion of their mortgage.
The Society achieved gross lending of £4.3 billion in the first six months of
2025 (Period to 30 June 2024: £5.2 billion), as the Society maintained
pricing discipline in an increasingly competitive market. The Society has
returned to a more natural market share than observed in the last two years,
with net lending in in the period to 30 June 2025 of £0.9 billion, compared
to £2.0 billion over the same period in 2024.
The UK savings market
The year so far has seen reductions in Bank Rate and consequently a reduction
in the savings rates available to customers across the market. This effect has
been tempered to a degree by heightened levels of competition for retail
deposits, in particular in the fixed rate market. Competition has likely been
driven by lenders individual funding and growth plans, the protection of
significant fixed term product maturities, and the requirement to generate the
funds needed to meet significant levels of TFSME(13) repayment, which are due
by the end of 2025.
In addition to this ongoing theme, this year's ISA season was again very
competitive, amplified by the uncertainty around the government's approach to
changing ISA subscription limits prior to the start of the 2025 tax year.
Whilst the limits have so far remained ultimately unchanged, the market saw
heightened movements from non-ISA deposits into ISA's compared to previous
years. The largest lenders also priced their fixed rate ISA ranges
competitively, often at market best buy rates, another indication of a more
competitive market than observed in previous years.
Against this backdrop, we remain committed to helping customers improve their
financial resilience by providing purposeful propositions such as our First
Home Saver, where we have opened 661 new accounts so far this year, and the
2025 issue of our Christmas Regular Saver which over 12,000 savers have so far
taken advantage of.
The rates of return we offered on our savings products continued to outperform
the market average; our variable rates were 0.63 percentage points higher
(0.90 percentage points higher over 2024). The competitive pressures in the
market outlined above, along with our strong levels of liquidity, have led us
to take a more measured approach to deposit balance management this year.
Balances decreased by £0.2 billion to £52.7 billion (Period to 30 June 2024:
£2.6 billion growth).
13 TFSME, Term Funding Scheme with additional incentives for Small- and
Medium-sized Enterprises.
Outlook
The UK economy is projected to grow modestly in the foreseeable future. While
business confidence has shown some limited signs of recovery, challenges such
as inflation, fiscal constraints, and global trade uncertainties pose risks to
sustained economic growth.
The market expectation for the future path of Bank Rate suggests further
gradual reduction over the course of the next two years, although recent
market volatility suggests the pace of Bank Rate reductions is uncertain.
A falling Bank Rate environment is likely to result in lower mortgage rates
and improve affordability constraints. 2025 has seen heightened competition
and margin compression across the market, consequently making customer
retention more challenging. Many customers are also reaching the end of
historically low five-year fixed rates, resulting in an increase in payment
rate when the product matures. Conversely, those who have been locked into
higher rates over the past two years are now likely to be seeking payment
relief and actively pursuing more competitive deals, increasing price
sensitivity amongst customers. In this context, we expect competition in the
market to remain elevated for the near future.
Further decreases in Bank Rate will likely see a reduction in returns
available for savers. However, this is difficult to predict given the
potentially volatile rate environment. In response, customer preferences may
shift towards the flexibility of easy-access accounts. Alternatively, some may
choose fixed-rate products to lock in currently favourable rates before any
further decline. The overall market size is expected to experience modest
growth in the near term, as a portion of customers continue to draw on their
savings to manage elevated living costs.
In addition to changing consumer behaviours, there is continued speculation
that the structure of ISAs, including subscription limits, will be revisited
by the Chancellor in the Autumn Budget. There is also an on-going consultation
concerning increasing the FSCS protection limit from £85,000 to £110,000.
Both of these prospective changes are likely to have an impact on the UK
savings market.
Significant risks continue to be posed by geopolitical factors such as US
tariff policies and their subsequent impact on global trade, alongside ongoing
conflicts in the Middle east and Ukraine. Domestically, changes to UK fiscal
policy aimed at reducing the budget deficit have the potential to impact wage
growth and consumer spending.
The Society is well positioned to navigate periods of economic uncertainty,
and we closely monitor the external environments in which we operate. We will
continue to prioritise the financial strength and competitive position of the
Society in the interests of our members, and will respond appropriately to
opportunities, challenges, and threats as they emerge.
Our financial performance
The following summary sets out the key drivers of our financial results over
the first half of the year, and the impact they have on the condensed interim
financial statements.
The table below presents the results of the Group for the half-year ended 30
June 2025. See note 1 to the condensed interim financial statements for more
information on the basis of preparation.
Income Statement
The financial services market has continued to experience margin pressures
driven by recent reductions in the Bank Rate and increased levels of
competition. These rate cuts have led to lower mortgage pricing across the
sector, alongside a reduction in savings rates. While the Bank Rate remained
unchanged during the first half of 2024, the first half of 2025 saw two
decreases which when combined with the cumulative effect of the two rate
reductions in the second half of 2024, has created downwards pressure on net
interest margin. However, our measured approach to pricing, coupled with our
structural hedge has resulted in an increased net interest margin as rates
decline, demonstrating our prudent and proactive management of the balance
sheet.
Despite challenges in the external environment, the Group has delivered strong
financial performance, supported by a growing mortgage book and effective risk
management. As a result, net interest income was £429.6 million in the
period, an increase from the same period last year (Period to 30 June 2024:
£340.8 million).
Management expenses have increased year on year as we increase our investment
in strategic change, and a higher headcount to support both project delivery
and ongoing operational activities.
Our financial performance is monitored by our Board who, in addition to
looking at statutory profit before tax, look at core operating profit. Core
operating profit excludes items such as fair value volatility and one-time
charges that are either temporary in nature or reverse over time and so do not
reflect the Group's day-to-day activities. In this reporting period, core
operating profit was £215.4 million, an increase of £66.2 million on the
equivalent period last year (Period to 30 June 2024: £149.2 million).
The following table shows the items removed from statutory profit before tax
to arrive at core operating profit.
Half-year to Half-year to Year to
30 June 2025 30 June 2024 31 December 2024
Statutory Remove non-core items Core Statutory Remove non-core items Core Statutory Remove non-core items Core
Notes £m £m £m £m £m £m £m £m £m
Net interest income i 429.6 (1.0) 428.6 340.8 (1.8) 339.0 736.5 (2.4) 734.1
Fair value gains and losses ii (28.8) 28.8 - 7.1 (7.1) - 36.2 (36.2) -
Net realised gains 0.9 - 0.9 - - - 0.2 - 0.2
Other income and expenses iii (12.4) (0.4) (12.8) 1.2 - 1.2 (21.1) (0.2) (21.3)
Total income/core income 389.3 27.4 416.7 349.1 (8.9) 340.2 751.8 (38.8) 713.0
Management expenses (199.2) - (199.2) (180.5) - (180.5) (366.6) - (366.6)
Impairment of financial assets (2.0) - (2.0) (10.7) - (10.7) (0.2) - (0.2)
Movement in provisions iv (0.2) 0.1 (0.1) 0.2 - 0.2 (1.3) 0.8 (0.5)
Profit before tax/core operating profit 187.9 27.5 215.4 158.1 (8.9) 149.2 383.7 (38.0) 345.7
The notes below explain the adjustments made to statutory profit to arrive at
the core operating profit figure:
i. Historical fair value credit adjustments on acquired loans.
ii. Removed fair value volatility i.e. gains and losses on derivatives
not qualifying for hedge accounting, and on non-core equity investments.
iii. Profit/(loss) on the sale of fixed assets and on the disposal of
intangible assets.
iv. Non-core elements of the restructuring provision.
The following are the main items in the income statement that contribute to
core operating profit:
· Net interest income for the year to June is £429.6 million
(Period to 30 June 2024: £340.8 million), representing a net interest margin
of 1.31%, an increase of 0.22 percentage points compared to the equivalent
period last year. In prior years, agency commission was shown as a reduction
to net interest income (Period to 30 June 2024: £11.6 million cost).
Following a reclassification to better reflect the contractual agreement, this
cost is now included in net fees and commission. On a like for like basis, net
interest income in the period to 30 June 2024 would have been £352.5 million.
· Movements in fair value gains and losses are primarily driven by
fluctuations in swap rates observed during the first half of the year.
· Other expenses of £12.4 million relates to fees, commissions,
and other operating income (Period to 30 June 2024: £1.2 million income).
Agency commission expense of £11.1 million is also included in the other
income and expenses line, following a reclassification at the year end to
better reflect the contractual agreement, with this item previously
categorised within net interest income.
· Management expenses were £199.2 million, an increase of £18.7
million against the same period in 2024. Cost increases were driven by
investments in multi-year projects, a significant portion of which relates to
an increase in the number of full-time equivalent employees contributing to
these initiatives.
· Movements in management expenses and net interest income have
resulted in a decrease in the cost to core income ratio from 51% to 48%.
· An impairment charge of £2.0 million has been recorded in the
period (Period to 30 June 2024: £10.7 million). See note 8 to the condensed
interim financial statements for more information on expected credit losses,
including the economic scenarios used.
As a mutual, we do not pay dividends to external shareholders. Our
profitability requirements are solely driven by the need to support ongoing
operations and reinvest in the future of the Society. Profit remains
sufficient to fund our long-term strategy and ensure we remain resilient to
economic pressures.
The Group's business activities are focused within the UK and predominantly
relate to mortgage lending which is funded primarily through domestic
deposits. We continue to have a cautious approach to liquidity management and
as at 30 June 2025, the majority of our liquidity portfolio consisted of
exposures to the Bank of England and the UK Government.
Balance Sheet
The balance sheet presented below is rounded to the nearest point one of a
billion. Any figures or measures quoted are based on the consolidated balance
sheet on page 17.
As at As at As at
30 June 2025 30 June 2024 31 December 2024
£bn £bn £bn
Liquid assets 14.3 13.7 14.6
Loan and advances to customers 50.6 48.8 49.7
Fair value adjustment for hedged risk on loans and advances to customers (0.1) (0.7) (0.5)
Other assets 1.1 2.1 1.7
Total assets 65.9 63.9 65.5
Shares(14) 51.8 49.6 52.0
Wholesale funding and other deposits(15) 7.9 8.1 7.3
Subordinated liabilities 1.5 1.5 1.5
Other liabilities 0.6 0.9 0.7
Total liabilities 61.8 60.1 61.5
Members' interest and equity 4.1 3.8 4.0
Total members' interest, equity, and liabilities 65.9 63.9 65.5
Overall balance sheet growth in the 6 months to 30 June 2025 was 0.6% (Period
to 30 June 2024: 4.8%).
14 Shares in the summary balance sheet includes the fair value adjustment for
hedged risk on shares of £43.1 million (31 December 2024: £1.0 million).
15 Within 'wholesale funding and other deposits' are £0.9 billion of retail
savings deposits not classed as shares (30 June 2024: £0.7 billion, 31
December 2024: £0.9 billion).
Shares balances have remained broadly stable since the year end, reaching
£51.8 billion (31 December 2024: £52.0 billion). This reflects the increased
market pressures as the deadline for TFSME repayments approaches, alongside a
wider trend of slower growth across the UK savings market driven by lower
interest rates. During 2024, we repaid the final £1.0 billion of the Bank of
England's funding scheme, TFSME, as we anticipated competition would heighten.
While savings balances have remained stable so far this year, we continue to
support our members with our average savings rate differential continuing to
outperform the market average.
Net mortgage lending was positive at £0.9 billion, albeit lower than the same
period in 2024 (Period to 30 June 2024: £2.0 billion). Lending volumes in
early 2024 were supported by favourable market conditions, but growth
moderated in the second half of the year as the Bank Rate began to fall and
competition intensified. This more measured pace of growth has continued into
the first half of 2025. The Society has maintained a disciplined approach to
lending and pricing, with our market share remaining resilient, reflecting the
continued strength of our propositions and our commitment to sustainable
growth.
The asset quality of our loan book remains high. The value of loans more than
three months in arrears represents 0.45% of our mortgage book at 30 June 2025
(31 December 2024: 0.43%). The number of accounts which are more than three
months in arrears (including possessions) is 0.52% at 30 June 2025 (31
December 2024: 0.50%), which remains significantly better than the industry
average, the latest data for which is 0.93% (31 December 2024: 0.97%)(16). A
number of indicators are used in assessing the credit quality of our loan
book, which are continually monitored. We also continue to consider our
lending criteria carefully.
In January we successfully issued the latest covered bond in our portfolio.
With a liquidity coverage ratio of 228.5% (31 December 2024: 202.7%) and a
liquidity ratio of 23.9% (31 December 2024: 24.6%), the Society continues to
maintain significant headroom above regulatory requirements. Our strong
liquidity position reflects a prudent approach to risk management and ensures
we can operate sustainably through changing market conditions. The liquidity
coverage ratio as at 30 June 2025 also reflects work undertaken to strengthen
the Society's capabilities in respect of liquidity regulatory reporting, the
implementation of which contributes to a significant portion of the increase
in the metric since 2024 year end.
Key capital ratios demonstrate significant headroom against regulatory
minimums. In 2024, work was undertaken to strengthen the Society's governance,
risk, and control capabilities in respect of capital related disclosures and
regulatory reporting. The implementation of resulting enhancements has
contributed significantly to the year-on-year increase in the leverage ratio.
Our CET 1 ratio, which represents the relationship between the strongest form
of capital (predominantly retained profits) and risk-weighted assets, is 18.5%
(31 December 2024: 18.1%).
The UK leverage ratio is calculated by dividing Tier 1 capital resources by
the leverage exposure, which is a prescribed measure of on- and off-balance
sheet items. This measure is in accordance with the UK regulatory framework,
and currently stands at 6.9% (31 December 2024: 6.6%).
The Society is undertaking the necessary preparations for implementation of
Basel 3.1 on 1 January 2027. The Society currently applies the standardised
approach to credit risk, and it is expected to continue doing so at the point
of implementation. Due to the Society's primary focus on low-risk Residential
Real Estate, the implementation of Basel 3.1 is expected to have a positive
impact on the Society's CET1 ratio.
16 Industry average sourced from UK Finance: Retail, 3m+ in arrears. Latest
data available is as at March 2025.
Risk overview
The environment in which we operate and the nature of the risks that we face
are continually evolving.
Effective risk management is fundamental to ensure we achieve sustainable
growth and maintain the trust of our members, customers, colleagues, and
regulators.
How we manage risk
We categorise the emerging and evolving risks that we face into the eight
principal risks defined in our Enterprise Risk Management Framework. This
ensures that we identify, assess, and manage these risks carefully and
consistently.
The most significant emerging and evolving risks are reviewed regularly
through our senior risk committees and are considered during our business
planning processes.
We continue to monitor the effectiveness of, and invest in, our risk
management capabilities to ensure timely and appropriate action is taken to
protect the interests of the Society and its members and customers.
Our robust risk management framework, strong capital position, diverse funding
sources, and high liquidity levels lead us to be confident in our financial
and operational resilience.
Top emerging and evolving risks
Emerging or evolving risk Principal risk(s) Commentary
Our Strategy and the external environment § Strategic Risk Our core markets of savings and mortgages are highly competitive. It is
therefore important that we operate a responsible and sustainable business on
§ Financial Risk our members' behalf.
Our business model is robust; however, macro-economic forces are changing the
banking landscape. It is imperative to assess and monitor these business
model risks and macro-economic trends and their potential impact to ensure we
can continue to operate sustainably over the longer-term.
We regularly monitor, assess, report and manage the most material risks to our
strategy as part of our Enterprise Risk Management Framework, and through our
strategy and planning processes.
We control our costs appropriately and ensure investments are prioritised to
the areas that will deliver most for our members and customers.
We stress-test our capital and liquidity positions regularly and our capital
and liquidity ratios continue to remain significantly within the
Board-approved risk appetite.
Cyber security § Operational Risk The cyber security threat to the UK financial services industry continues to
grow, originating from both organised crime groups and nation state operators.
'Threat actors' are becoming ever more invasive and sophisticated in their
approaches, with ransomware and the exploitation of vulnerabilities key
threats.
Resilience to such threats, and an ability to respond effectively in the event
of an attack, remain essential. We continue to invest in and enhance our cyber
threat monitoring and response capability to protect the Society and our
members and customers, and to maintain the confidence of our regulators.
Fraud § Operational Risk Criminals are becoming ever more sophisticated in targeting consumers. Typical
frauds in financial services include phishing, identity theft, account
§ Conduct Risk takeovers and scams.
We continue to invest in and upgrade our fraud prevention and monitoring
controls to help protect our members from becoming victims of fraud.
Economic impact on our customers § Credit Risk We remain alert to potential economic impacts on our customers from rising
unemployment and economic uncertainty. Mortgage borrowing costs are much
higher than they were five years ago so household finances for many customers
will remain strained.
For new lending, we use an affordability model which applies a stressed
interest rate, which is reviewed at least every six months, to ensure that
customers could afford their mortgage payments at a higher rate. Our lending
criteria aim to balance the level of risk we take with lending responsibly to
deliver good customer outcomes, minimise arrears and comply with the Consumer
Duty regulations. And, for existing borrowers, we have a range of options to
support customers who may be experiencing financial difficulty, including
forbearance options.
Technology resilience § Operational Risk Reliable and cost-effective IT infrastructure is vital to deliver the level of
service our members, customers, colleagues, and regulators expect. As IT
components age, their health and value deteriorate and the risks they pose to
security and resilience increase.
We therefore continue to modernise and simplify our IT infrastructure to
ensure it remains resilient and secure.
Colleague attraction and retention § People Risk Attracting and retaining talented colleagues to deliver Our Strategy is vital,
and we continue to experience competition for certain skillsets; digital,
cyber security, change management and data analytics skills are particularly
in demand.
Effective resource planning, forecasting, and succession planning remain
priorities. We are refreshing our People Plan and Employee Value Proposition
and continually refine our people policies and processes to improve colleagues
experience of life at YBS.
The use of sophisticated models § Model Risk We use sophisticated models primarily to help manage our financial risks.
These use historical data and assumptions based on the past to provide future
estimates to assist with running the business and in understanding our risks.
Any approach that seeks to predict the future carries inherent risk.
Our Model Risk Committee regularly reviews the specific risks associated with
the models. We also ensure that our model risk framework meets regulatory
requirements.
Transforming our business § Change Risk We are transforming our business to support the next phase of our growth plans
and deliver Our Strategy. This involves implementing new systems, automating
business processes, and developing new ways of working.
Managing this change execution effectively will ensure that we deliver the
required strategic outcomes. We have therefore refreshed our change risk
management framework which includes stronger governance and oversight
controls.
The regulatory environment § Conduct Risk The regulatory environment in which we operate continues to evolve.
§ Strategic Risk Monitoring and maintaining our regulatory compliance positions is one of our
highest priorities.
Climate change § Credit Risk The main risks from climate change for the Society arise in the physical risks
to our customers' properties, such as from flooding, subsidence, and coastal
§ Operational Risk erosion, and those posed by the transition to a lower-carbon economy, such as
changes in energy efficiency regulation.
We continue to develop our environmental and climate change risk management
capabilities to ensure that we align with industry good practice and meet
reporting and disclosure requirements.
Regulatory environment
The Society places emphasis on operating in a responsible and sustainable way.
As part of this, we monitor the regulatory environment and take steps to
ensure compliance with all existing and upcoming regulation. Relevant
regulatory updates include:
Mortgage Rule Review
The Financial Conduct Authority (FCA) wants to ensure firms are aware of the
flexibility its rules provide, and that creditworthy consumers can access the
affordable mortgage they need, supporting home ownership. On 6 May 2025, the
FCA launched a consultation - Mortgage Rule Review, proposing early ideas to
simplify its rules and benefit mortgage consumers, making it easier to:
· remortgage with a new lender;
· discuss their options outside a regulated advice process;
· reduce their mortgage term.
The rules will be permissive; YBS can choose whether or not to take up the new
flexibility. In principle, YBS is supportive of the proposed changes around
the advice process. YBS is committed to ensuring that lending is done
responsibly with customer affordability being assessed.
In June, the FCA opened a public discussion on the future of the mortgage
market to consider further changes; the discussion covers topics such as risk
appetite (i.e. the level of risk a firm is prepared to take) and responsible
risk-taking, alternative affordability testing and product innovation, lending
into later life, and consumer information needs. Alongside all interested
parties, the FCA will consider what the market needs to deliver for different
consumers at different stages in their lives and the wider UK economy, and the
role of regulation to deliver it.
Separately, the Prudential Regulation Authority (PRA) announced a review of
the Loan to Income (LTI) flow limit rule and offered firms a modification by
consent to disapply the relevant rule while the review is ongoing. YBS'
application for the modification has been approved. The current LTI rule
ensures that mortgage lenders limit the number of new residential mortgage
loans made with an LTI ratio at, or greater than, 4.5 to no more than 15% of
their total number of new mortgage loans per annum. YBS has engaged with the
Bank of England and the FCA to support the review and outlined how LTI reform
can support more first-time buyers onto the housing ladder.
Modernising the Redress System
On 15 November 2024, the FCA, and the Financial Ombudsman Service (FOS)
published a joint Call for Input on Modernising the Redress System.
Customers in the UK have access to redress when matters go wrong by initially
contacting the firm they are dealing with. Firms have 8 weeks to deal with a
complaint and if the customer is unhappy with the response, they have the
right to refer their complaint to the FOS, free of charge. The Call for Input
aimed to reform the redress system and address how consumers can more easily
access fair compensation when things go wrong, focusing on fairness, speed,
and efficiency in resolving disputes.
The key objectives for this Call for Input were that:
· Consumers can get redress when things have gone wrong.
· Firms identify harm at an early stage, proactively address it,
and resolve complaints more effectively themselves, reducing the need for
consumers to complain.
· By working with firms to identify redress events earlier, they
can be resolved swiftly and efficiently, this could result in fewer events
escalating into mass redress events and reduce the burden on the FOS and the
Financial Services Compensation Scheme (FSCS).
· Communications with consumer and industry stakeholders are
improved, making it quicker and easier to flag matters with wider market
implications.
· Improvement in how the FOS & FCA work together to ensure
regulatory views are consistent as this will help provide a more certain
regulatory environment for firms.
Following the Call for Input, the FCA launched a public consultation on the
proposed changes on 15 July 2025.
The Energy Performance of Buildings (EPB) regime was introduced in phases from
2007, with the goal of improving the energy efficiency of buildings, reducing
their carbon emissions, and lessening the impact of climate change. Relevant
legislation is the Energy Performance of Buildings (England and Wales)
Regulations 2012 ("EPB Regulations"). Since their introduction, the policy
landscape around energy has changed greatly with new priorities and as a
result the Government has proposed changes to the EPB Framework. The
Government issued a consultation paper on 4 December 2024 - Reforms to the
Energy Performance of Buildings regime, outlining proposed reforms to enhance
the building energy performance regime in five critical areas: updating EPC
metrics, refining requirements for Energy Performance Certificates (EPCs) and
Display Energy Certificates (DECs), improving data management protocols,
strengthening quality control, and revising Air Conditioning Inspection
Reports (ACIRs).
The Government is proposing using multiple metrics on EPCs to provide a more
complete representation of building energy performance. Four headline
metrics have been proposed: fabric performance, heating system, smart
readiness, and energy costs, with other metrics provided as secondary
information. Using multiple complementary metrics as the Government proposes
marks a significant change from the current system of a single metric rating
and considering the impact on EPC users will be important in the final design
of the EPC.
Digital Property Market
Under major new plans announced on 9 February 2025, the Government will
modernise the way the house buying and selling process works to bring down
current delays of almost five months. One of the key reasons the buying and
selling process can be long and frustrating is a lack of digitalisation and
join up in the sector. The Government is seeking to open up key property
information, ensuring this data can be shared between trusted professionals
more easily, and driving forward plans for digital identity services to cut
transaction times.
A 12-week project was announced to identify the design and implementation of
agreed rules on data for the sector, so that it can easily be shared between
conveyancers, lenders and other parties involved in a transaction. HM Land
Registry will also build on its work in digitising property information and
will lead 10-month pilots with a number of councils to identify the best
approach to opening up more of their data and making it digital.
Vulnerable Customer Review
On 7 March 2025, the FCA concluded their review of Firms' treatment of
customers in vulnerable circumstances. The review looked into Firms'
understanding of consumer needs, the skills and capacity of staff, product and
service design, communications and customer service, and whether these
supported the fair treatment of customers in vulnerable circumstances. The
review also investigated whether the outcomes vulnerable customers received
were as good as outcomes of other customers. The review was wide ranging, and
included surveys completed by Firms and separate multi-firm reviews, which YBS
participated in.
On conclusion of the review, the FCA decided that their existing guidance on
the treatment of vulnerable customers was still appropriate. YBS recognises
that every day we meet people who are part of our vulnerable community - they
might be our customers, or maybe their family and friends who support them. We
aim to deliver a positive customer experience for everyone, no matter what
their circumstances, and to provide extra care to our vulnerable community
when they need it. Help can be provided in any of our branches or agencies,
through our secured message service or by telephone on 0345 1200 805.
Changes to the Board
A complete list of the board of directors can be found in the 2024 Annual
Report and Accounts and there have been no changes to the directors during the
first six months of 2025.
Signed on behalf of the Board by
Susan Allen, OBE
Chief Executive Officer
23 July 2025
Tom Ranger
Chief Financial Officer
23 July 2025
Condensed Interim Financial Statements
Consolidated Income Statement
(Unaudited)
Half-year to Half-year to Year to
30 June 2025 30 June 2024 31 December 2024
Notes £m £m £m
Interest revenue calculated using the effective interest rate method 3 1,320.3 1,186.3 2,496.5
Other interest revenue 3 305.2 473.0 879.9
Interest revenue 3 1,625.5 1,659.3 3,376.4
Interest expense 4 (1,195.9) (1,318.5) (2,639.9)
Net interest income 429.6 340.8 736.5
Fee and commission revenue 5.6 9.0 16.9
Fee and commission expense (18.6) (8.1) (38.8)
Net fee and commission (expense)/income (13.0) 0.9 (21.9)
Net (losses)/gains from financial instruments held at fair value 5 (28.8) 7.1 36.2
Net realised gains on disposal of financial instruments 0.9 - 0.2
Other operating income 0.6 0.3 0.8
Total income 389.3 349.1 751.8
Administrative expenses (191.9) (170.5) (343.1)
Depreciation and amortisation (7.3) (10.0) (23.5)
Impairment charge of financial assets 6 (2.0) (10.7) (0.2)
Movement in provisions (0.2) 0.2 (1.3)
Profit before tax 187.9 158.1 383.7
Tax expense 7 (49.8) (41.6) (102.0)
Profit for the period 138.1 116.5 281.7
Consolidated Statement of Comprehensive Income
(Unaudited)
Half-year to Half-year to Year to
30 June 2025 30 June 2024 31 December 2024
£m £m £m
Profit for the period 138.1 116.5 281.7
Items that may be subsequently reclassified through profit or loss
Cash flow hedges:
Fair value movements taken to equity (15.9) - 5.7
Amounts transferred to the income statement 2.6 (0.1) 3.5
Tax on amounts recognised in equity 3.7 - (2.6)
Financial assets measured through other comprehensive income:
Fair value movements taken to equity 6.9 18.6 (13.8)
Amounts transferred to the income statement 0.9 0.3 1.2
Tax on amounts recognised in equity (2.2) (5.3) 3.5
Items that will not be reclassified through profit or loss
Remeasurement of retirement benefit obligations (4.6) 2.2 (4.2)
Tax on remeasurement of retirement benefit obligations 1.3 (0.6) 1.2
Total other comprehensive (expense)/income (7.3) 15.1 (5.5)
Total comprehensive income for the period 130.8 131.6 276.2
Consolidated Balance Sheet
(Unaudited)
As at As at As at
30 June 2025
30 June 2024
31 December 2024
Notes £m £m £m
Assets
Cash and balances with the Bank of England 6,417.4 5,274.8 5,609.7
Loans and advances to credit institutions 651.0 568.9 590.0
Debt securities 7,222.3 7,864.3 8,421.3
Loans and advances to customers 8 50,571.7 48,840.2 49,705.5
Fair value adjustment for hedged risk on loans and advances to customers (77.0) (689.9) (454.7)
Derivative financial instruments 931.1 1,793.0 1,466.9
Investments 1.6 3.2 1.6
Intangible assets 15.8 16.3 16.1
Investment property 11.1 15.7 11.1
Property held for sale - 0.6 0.8
Property, plant and equipment 99.4 98.8 101.4
Retirement benefit surplus 9 28.1 40.3 33.0
Current tax assets - 16.2 5.3
Other assets 33.0 33.5 36.4
Total assets 65,905.5 63,875.9 65,544.4
Liabilities
Shares 51,769.4 49,637.6 52,044.4
Fair value adjustment for hedged risk on shares 43.1 - 1.0
Amounts owed to credit institutions 952.8 1,885.1 1,168.9
Other deposits 1,429.7 1,201.4 1,196.8
Debt securities in issue 5,554.0 5,035.3 5,019.3
Derivative financial instruments 433.9 677.5 555.8
Current tax liabilities 2.3 - 0.2
Deferred tax liabilities 32.7 45.7 43.2
Retirement benefit obligations 9 7.1 7.6 7.4
Provisions for liabilities and charges 3.3 2.9 4.2
Subordinated liabilities 1,489.7 1,485.1 1,453.3
Other liabilities 82.0 67.6 75.2
Total liabilities 61,800.0 60,045.8 61,569.7
Members' interests and equity 4,105.5 3,830.1 3,974.7
Total members' interest, equity and liabilities 65,905.5 63,875.9 65,544.4
Consolidated Statement of Changes in Members' Interest and Equity
(Unaudited)
General Cash flow Fair value through other comprehensive income Total
reserve hedge
reserve
£m £m £m £m
Half-year to 30 June 2025
At 1 January 2025 3,987.0 7.0 (19.3) 3,974.7
Profit for the period 138.1 - - 138.1
Net remeasurement of defined benefit obligations (3.3) - - (3.3)
Net movement in cash flow hedges - (9.6) - (9.6)
Net movement in fair value through other comprehensive income - - 5.6 5.6
Total comprehensive income 134.8 (9.6) 5.6 130.8
At 30 June 2025 4,121.8 (2.6) (13.7) 4,105.5
Half-year to 30 June 2024
At 1 January 2024 3,708.3 0.4 (10.2) 3,698.5
Profit for the period 116.5 - - 116.5
Net remeasurement of defined benefit obligations 1.6 - - 1.6
Net movement in cash flow hedges - (0.1) - (0.1)
Net movement in fair value through other comprehensive income - - 13.6 13.6
Total comprehensive income 118.1 (0.1) 13.6 131.6
At 30 June 2024 3,826.4 0.3 3.4 3,830.1
Year to 31 December 2024
At 1 January 2024 3,708.3 0.4 (10.2) 3,698.5
Profit for the year 281.7 - - 281.7
Net remeasurement of defined benefit obligations (3.0) - - (3.0)
Net movement in cash flow hedges - 6.6 - 6.6
Net movement in fair value through other comprehensive income - - (9.1) (9.1)
Total comprehensive income 278.7 6.6 (9.1) 276.2
At 31 December 2024 3,987.0 7.0 (19.3) 3,974.7
Consolidated Statement of Cash Flows
(Unaudited)
Half-year to Half-year to Year to
30 June 2025 30 June 2024 31 December 2024
Notes £m £m £m
Cash flows from operating activities
Profit before tax 187.9 158.1 383.7
Non-cash items included in profit before tax 11 72.0 64.2 77.6
Net change in operating assets 11 (720.0) (1,822.2) (2,577.3)
Net change in operating liabilities 11 (221.2) 2,719.5 4,334.5
Tax paid (50.1) (35.5) (80.6)
Net cash flow from operating activities (731.4) 1,084.1 2,137.9
Cash flows from investing activities
Purchase of property, plant and equipment, and intangible assets (4.8) (7.2) (18.3)
Proceeds from sale of property, plant and equipment 0.8 - -
Purchase of debt securities (1,172.0) (1,671.7) (3,769.4)
Redemption and other movements of debt securities 2,379.7 1,388.2 2,897.6
Net cash flow from investing activities 1,203.7 (290.7) (890.1)
Cash flows from financing activities
Redemption of debt securities in issue 11 (82.5) (1,006.4) (1,429.4)
Issue of debt securities 11 507.6 1,178.6 1,543.6
Redemption of subordinated liabilities 11 (25.6) (142.5) (142.6)
Interest paid on subordinated liabilities (1.7) (37.4) (76.7)
Interest paid on lease liabilities (0.2) 0.2 (0.5)
Capital repayments on lease liabilities (1.2) (2.2) (2.5)
Net cash flow from financing activities 396.4 (9.7) (108.1)
Net change in cash and cash equivalents 868.7 783.7 1,139.7
Opening balance 6,199.7 5,060.0 5,060.0
Closing cash and cash equivalents 7,068.4 5,843.7 6,199.7
Cash and cash equivalents
Cash and cash equivalents 6,417.4 5,274.8 5,609.7
Loans and advances to credit institutions 651.0 568.9 590.0
Closing cash and cash equivalents 7,068.4 5,843.7 6,199.7
Net cash flows from operating activities of the Group include interest
received of £732.7 million (Period to 30 June 2024: £876.5 million) and
interest paid of £1,686.9 million (Period to 30 June 2024: £1,433.3
million).
Notes to the Interim Financial Statements
1. Basis of Preparation
These condensed interim financial statements present the results of Yorkshire
Building Society ('YBS') and its controlled entities (collectively 'the Group'
or 'YBS Group') for the half-year ended 30 June 2025.
The accounting policies, presentation and measurement applied during the
period are consistent with those applied by the Group in the 31 December 2024
audited annual financial statements being International Accounting Standards
(IAS), International Financial Reporting Standards (IFRS) and interpretations
(IFRICs) issued by the International Accounting Standards Board (IASB)
endorsed by the UK Endorsement Board (UKEB) and effective as at 1 January
2025. The presentation applied in the period is consistent with the
presentation applied in the 31 December 2024 audited annual financial
statements.
The Group is required under the Building Societies Act 1986 to apply
'UK-adopted international accounting standards' as endorsed by the UKEB. The
condensed interim financial statements have therefore been prepared in
accordance with UK-adopted IAS 34 Interim Financial Reporting and the
Disclosure Guidance and Transparency Rules of the United Kingdom's Financial
Conduct Authority.
Pounds sterling is both the functional currency of the YBS Group and the
presentation currency applied to these financial statements. Except where
otherwise stated, all figures in the financial statements are presented in
round hundreds of thousands of pounds sterling (£0.0 million).
The Group operates solely within the retail financial services sector and
within the United Kingdom. As such, no segmental analysis is presented.
During the half-year to 30 June 2025 there have been no changes to the
composition of the Group. The condensed interim financial statements have been
subject to a review and have not been audited.
Accounting developments
The information on future accounting developments and their potential effect
on the financial statements are provided on page 137 of the 2024 Annual Report
and Accounts.
Going concern
The YBS Board of Directors undertake regular assessments of whether the Group
is a going concern in light of changing economic and market conditions, using
all available information about future risks and uncertainties. Details of the
review undertaken to support the 31 December 2024 financial statements are
given on pages 136 of the 2024 Annual Report and Accounts.
The directors confirm that, based on the most recent Internal Capital Adequacy
Assessment Process (ICAAP) review, approved by the Board in July 2025, the
Group holds sufficient resources to continue operating for at least 12 months
from the date of the approval of this report. Accordingly, they continue to
adopt the going concern basis in preparing these condensed interim financial
statements.
2. Critical accounting judgements and key sources of estimation uncertainty
In applying its accounting policies, the Group makes judgements that have a
significant impact on the amounts recognised in the financial statements.
In addition, estimates and assumptions are used that could affect the reported
amounts of assets and liabilities. The estimates and underlying assumptions
are reviewed on an ongoing basis.
The key assumptions concerning the future, and other key sources of estimation
uncertainty at the reporting date that may have a significant risk of causing
a material adjustment to the carrying amount of assets and liabilities within
the next financial year, are discussed below.
Impairment of loans and advances to customers
The impairment calculation of expected credit losses (ECL) for a portfolio of
mortgage loans is inherently uncertain. ECL are calculated using historical
default and loss experience but require judgement to be applied in predicting
future economic conditions (e.g. interest rates and house prices) and customer
behaviour (e.g. default rates). The most critical judgements that lead to
estimation uncertainty are as follows:
Economic scenario and weightings
A forum, supported by Finance, Credit Risk, Balance Sheet Management and
economic experts considers the forward-looking macroeconomic assumptions with
the objective of developing internally coherent economic scenarios to propose
to the Group Asset and Liability Committee (ALCO) for challenge and approval.
ALCO ensures that the ECL meets the requirement for unbiased and weighted
amounts derived by evaluating a range of possible outcomes and assumptions, or
economic scenarios.
Judgements are made in arriving at the level of each economic variable, such
as house price index (HPI) and unemployment, applied in each economic scenario
to support the estimate of ECL. ALCO applies judgements to arrive at these
assumptions.
The UK economy is experiencing a slowdown in growth, despite a strong
performance in the first quarter. The first half of the year has been marked
by global uncertainty, driven by ongoing trade tensions, new tariffs, and
escalating international conflicts. The labour market is gradually softening -
unemployment has been rising steadily since early 2024, while job vacancies
have declined. Redundancy rates remain steady, and wage growth appears to be
levelling off. Looking ahead, unemployment is projected to rise further,
though it is expected to stay within historical ranges.
Inflation remains persistent, with headline rates likely to stay above 3%
through the end of 2025, before easing back to target levels by 2027. Given
the combination of global instability, a cooling labour market, and sluggish
economic growth, the Bank of England is anticipated to continue its cautious
approach to interest rate cuts throughout the remainder of the year, despite
ongoing inflationary pressures.
Whilst there have been positive aspects to 2025 some uncertainty remains as
there are still loans coming to the end of their fixed term that have so far
been unaffected by interest rate rises. Management evaluated these
uncertainties, with the economic assumptions applied to the ECL model adjusted
to reflect any material changes in view of the macro-economic environment. A
post model adjustment raised in 2022 has been updated to reflect the risks
relating to affordability and the impact of cost-of-living increases on these
mortgage customers (see note 8 for more details).
The provision is calculated by applying a range of economic scenarios that are
weighted.
The Group continues to apply four economic scenarios. SME judgement is applied
in determining the relative weighting of each economic scenario in the ECL
estimate, informed both by an assessment of external data and statistical
model results.
In terms of sensitivity to changes in key economic variables within the model,
the ECL model was run with a 100% weighting applied to the Core scenario, in
both Core and Non-Core models. When the HPI forecast was replaced with the
respective forecasts from the Downturn and Severe Downturn scenarios ECL,
excluding PMAs, increased by £7.5 million and £28.7 million (31 December
2024: £6.8 million and £23.1 million). Below is the percentage change in HPI
forecast for both downturn scenarios for the next 5 years in relation to the
Core scenario.
June 2025 Scenario (% change)
2025 2026 2027 2028 2029
HPI
Downturn (5.5) (8.0) (2.5) (1.8) (1.8)
Severe (11.8) (16.6) (10.6) 3.8 0.5
December 2024 Scenario (% change)
2025 2026 2027 2028 2029
HPI
Downturn (7.0) (2.0) (2.5) (1.8) (1.8)
Severe (17.3) (12.5) (4.6) 3.1 (2.5)
3. Interest revenue
Half-year to Half-year to Year to
30 June 2025 30 June 2024 31 December 2024
£m £m £m
Calculated using the effective interest rate method:
Loans secured on residential property 1,013.0 884.1 1,867.7
Loans secured on commercial property 21.4 23.4 46.6
Other interest expense* (11.7) (24.9) (41.7)
Liquid assets 150.7 147.3 304.5
Debt securities 146.9 156.4 319.4
Interest revenue calculated using the effective interest rate method 1,320.3 1,186.3 2,496.5
Other:
Derivatives in hedge relationships 280.3 431.4 808.1
Derivatives not included in hedge relationships 24.1 40.7 70.1
Investments held at fair value 0.8 0.9 1.7
Other interest revenue 305.2 473.0 879.9
Total interest revenue 1,625.5 1,659.3 3,376.4
* Includes net interest income on clearing collateral agreements.
4. Interest expense
Half-year to Half-year to Year to
30 June 2025 30 June 2024 31 December 2024
£m £m £m
Shares held by individuals 937.8 992.3 2,022.3
Amounts owed to credit institutions 11.6 31.1 48.5
Other deposits 10.1 11.1 22.5
Debt securities in issue 86.7 84.6 174.3
Subordinated liabilities 35.1 37.4 74.0
Derivatives in hedge relationships 98.0 99.0 193.2
Derivatives not included in hedge relationships 16.4 62.7 104.5
Interest expense for leasing arrangements 0.2 0.2 0.5
Other interest payable - 0.1 0.1
Total interest expense 1,195.9 1,318.5 2,639.9
5. Net (losses)/gains from financial instruments held at fair value
Half-year to Half-year to Year to
30 June 2025 30 June 2024 31 December 2024
£m £m £m
Derivatives and debt securities not included in hedge relationships (12.9) (9.9) 16.7
Hedge accounting ineffectiveness (15.9) 17.1 21.2
Equity investments held at fair value - (0.1) (1.7)
Net (losses)/gains from financial instruments held at fair value (28.8) 7.1 36.2
Derivatives and hedging
The Society enters into interest rate swaps to hedge their exposure to
interest rate risk. All interest rate swaps are transacted for economic
hedging purposes, however not all are designated in to accounting hedges.
Those interest rate swaps not designated into accounting hedges are recorded
at fair value through profit and loss within derivatives and debt securities
not included in hedge relationships. This portfolio consists of interest rate
swaps that receive fixed cash flows (receive fix) and that pay fixed cash
flows (pay fix).
Interest rates used to determine fair values which are linked to BoE base rate
have been volatile throughout the first six months of the year, following bank
rate cuts, UK economic changes, the USA's tariff announcements and global
uncertainty. Although, the Group has seen a gradual decrease in rates over the
reporting period.
Hedge accounting ineffectiveness includes the ineffective portion of the
accounting hedges and amortisation adjustments relating to the inception and
de-designation of these hedges.
Investments held at fair value include the fair value gains and losses on
equity shares investment.
6. Impairment of financial assets
The following table splits the income statement impairment of financial assets
into those elements impacting the ECL and other items.
Half-year to Half-year to Year to
30 June 2025 30 June 2024 31 December 2024
£m £m £m
Impairment charge on loans and advances to customers 2.9 11.2 1.1
Recoveries relating to loans and advances previously written off (0.4) (0.4) (0.6)
Impairment release of other financial assets (0.5) (0.1) (0.3)
Impairment charge on financial assets 2.0 10.7 0.2
7. Tax expense
The Group has an effective tax rate of 26.5%, which is higher than the average
UK statutory corporation tax rate of 25.0% for the year. This is mainly due to
the effects of the banking surcharge on the taxable profits of the
Society.
The Government has enacted legislation to implement the G20-OECD Inclusive
Framework Pillar Two rules in the UK, effective for periods starting on or
after 1 January 2024. The intention of the legislation is to ensure that
UK-headquartered multinational enterprises pay a minimum tax rate of 15% on UK
and overseas profits arising after 31 December 2023. The rules include a
Qualified Domestic Minimum Top-Up Tax, which aims to ensure that large UK
groups pay a minimum tax rate of 15% on their UK
profits.
The Group has carried out an assessment of the expected impact of the Pillar
Two rules and the tax expense arising from Pillar Two is £nil for the period
ended 30 June 2025 and the year ended 31 December 2024.
8. Credit risk on loans and advances to customers
Gross contractual exposure
The table below splits the loans and advances to customers balance into its
constituent parts and reconciles to the gross exposures used in the Expected
Credit Loss (ECL) model.
Effective Interest Rate (EIR) is the measurement method used for financial
assets held at amortised cost which spreads income and fees over the life of
the asset.
The fair value rate adjustment reflects the market value adjustment on
acquired portfolios of mortgage assets in respect of interest rates on the
underlying products. This is amortised over the expected life of the acquired
portfolio.
The fair value credit adjustment is the fair value discount applied on
purchased or originated credit impaired (POCI) mortgage assets acquired as
part of the Norwich & Peterborough Building Society (N&P) and Chelsea
Building Society (CBS) acquisitions. Impairment represents the difference
between the total ECL and the fair value credit adjustment.
ECL is calculated using models that take historical default and loss
experience and apply predictions of future economic conditions (e.g.
unemployment and house prices) and customer behaviour (e.g. default rates). In
certain circumstances, the core models may not fully reflect other factors
that could result in a change in credit risk. When this happens, a post model
adjustment (PMA) is overlaid to reflect the impact on ECL. The economic
scenarios and the PMAs applied at 30 June 2025 are described below.
30 June 2025 30 June 2024 31 December 2024
£m £m £m
Gross contractual exposures 50,625.3 48,902.8 49,758.5
EIR and other adjustments 26.6 33.6 29.7
Fair value rate adjustment (21.0) (26.7) (24.1)
Gross loans and advances to customers 50,630.9 48,909.7 49,764.1
Impairment (41.5) (49.1) (39.2)
Fair value credit adjustment (17.7) (20.4) (19.4)
ECL (59.2) (69.5) (58.6)
Loans and advances to customers 50,571.7 48,840.2 49,705.5
Analysis of changes in ECL
The following tables analyse the changes in ECL, split by impairment and fair
value credit adjustments.
Half-year to Half-year to Year to
30 June 2025 30 June 2024 31 December 2024
£m £m £m
Opening impairment 39.2 37.7 37.7
Amounts written off in the period (1.4) (0.7) (1.4)
Discounting recognised in net interest income 0.8 0.9 1.8
Charge for the period recognised in the income statement 2.9 11.2 1.1
Impairment 41.5 49.1 39.2
Half-year to Half-year to Year to
30 June 2025 30 June 2024 31 December 2024
£m £m £m
Opening fair value credit adjustment 19.4 22.3 22.3
Release recognised in the income statement through net interest (1.0) (1.7) (2.3)
Amounts written off in the period (0.7) (0.2) (0.6)
Fair value credit adjustment 17.7 20.4 19.4
Expected Credit Loss (ECL)
Economic Scenarios
Accounting standards require ECL to be calculated by applying multiple
economic scenarios. Each economic scenario is provided a weighting, and these
are combined to arrive at the total ECL.
These scenarios are generated internally using external data, statistical
methodologies and management judgement, to span a range of plausible economic
conditions. The Group continues to use four scenarios: an upside scenario that
assumes more benign economic conditions; our core or central best estimate
scenario; a downturn scenario that assumes more adverse economic conditions;
and a more severe downturn scenario.
Scenarios are projected over a 5-year window, reverting to long-term averages
past that point. The Group allows all macro-economic scenarios to impact
staging.
Current Macroeconomic Conditions
Growth is slowing in the UK economy, despite a strong first quarter. Global
uncertainty has dominated the first half of this year, with ongoing trade
developments and tariff announcements, and escalation in global conflict. The
labour market continues to loosen, albeit gradually. Since the start of 2024,
unemployment has been rising steadily, while vacancy levels have declined.
Redundancy figures remain stable, and wage growth is showing signs of
stabilising. Looking ahead, unemployment is expected to increase but remain
within historical norms.
Inflation persistence continues, with headline inflation expected to remain
above 3% for the rest of 2025, before returning to target in 2027. The
combination of global uncertainty, a slowing labour market and low economic
growth mean the Bank of England are expected to continue cutting interest
rates gradually for the remainder of the year, despite inflation stubbornness.
Upside
A slower growth forecast, and lower inflation caused by global impact of Trump
tariff developments causing trade diversion into UK. As a result, there is a
reduced base rate path to reflect possible disinflationary impacts. Domestic
inflationary pressures fall quickly, and consumer confidence rises. The BoE
note the slowdown of inflation and cut rates to more sustainable levels.
Strong consumer confidence and lower interest rates encourage housing market
activity and house price growth.
Core
The Core scenario is the Group's best estimate of how the UK economy will
evolve and is aligned with the central scenario.
The scenario is broadly the same as previous forecasts, but with slightly less
positive GDP and labour market forecasts, to reflect heightened global
uncertainty and the potential impacts of ongoing trade developments when
compared to 2024. The BoE base rate expectations of only 2 further cuts by the
end of 2025 reflects the latest market view. Unemployment peak increased to 5%
in 2027 which is in line with the latest BoE forecast. GDP growth is reduced
to 0.8% in 2025 and 1.0% in 2026. House prices grow 3% each year throughout
the forecast.
Downturn
The nature of this scenario has changed from a 'stagflation' scenario to a
'demand shock' scenario to reflect the evolving global environment. Severity
of the scenario has increased, given the increased possibility of a global
slowdown. The scenario now includes a UK recession in the second half of 2025,
and GDP growth has been downgraded in 2025, 2026 and 2027. The unemployment
peak has been increased to 7% and negative house price growth in 2025 and 2026
with gradual recovery in subsequent years. BoE accelerates pace of rate cuts
to 2.5% to stimulate economy.
Severe Downturn
The scenario continues to be driven by global conflict, with heightened
inflation and interest rates, in line with the recently published BoE stress
scenario. A deep recession ensues, with unemployment rising and house prices
falling significantly. Whilst the evolving risks are skewing towards a lower
rate environment, this scenario remains the most penal from an affordability
and credit loss perspective whereas the downside scenario has been modified to
capture risks from lower rates.
Macroeconomic variables
The following table shows the values of the key economic variables used by
each economic scenario for the period until December 2029. The table includes
the three key parameters used to predict probability of default (PD) -
unemployment, HPI and Bank of England base rate. GDP is also presented as it
is the key input for determining the economic parameters used and provides
context to the nature of the overall scenario.
Note that inflation is not a key input parameter into the models and, as such,
the risks arising from sharply rising inflation, and the impact this has on
customers' ability to meet mortgage repayments, are not directly captured. An
Affordability post model adjustment has been raised in response to this
limitation to ensure the risk has been assessed and incorporated into the ECL.
June 2025 Scenario December 2024 Scenario
2025 2026 2027 2028 2029 2025 2026 2027 2028 2029
HPI
Upside 6.0 5.5 4.0 4.0 4.0 6.0 5.5 4.0 4.0 4.0
Core 3.0 3.0 3.0 3.0 3.0 3.0 3.0 3.0 3.0 3.0
Downturn (2.5) (5.0) 0.5 1.2 1.2 (4.0) 1.0 0.5 1.2 1.2
Severe Downturn (8.8) (13.6) (7.6) 6.8 3.5 (14.3) (9.5) (1.6) 6.1 0.5
GDP
Upside 1.6 1.7 2.0 2.2 2.2 1.9 2.0 2.4 2.2 2.2
Core 0.8 1.0 1.5 1.5 1.5 1.3 1.5 1.6 1.6 1.7
Downturn 0.2 0.4 0.6 1.2 1.2 0.5 0.7 1.0 1.2 1.2
Severe Downturn (2.5) (2.0) 0.5 0.8 0.8 (4.5) (1.5) 0.5 0.8 0.8
Unemployment
Upside 4.3 4.3 4.3 4.2 4.2 4.2 4.2 4.2 4.2 4.2
Core 4.8 4.9 5.0 4.7 4.5 4.6 4.7 4.6 4.5 4.5
Downturn 5.6 7.0 6.5 5.8 5.0 6.0 5.8 5.5 5.0 4.8
Severe Downturn 6.6 8.5 7.6 6.7 6.5 8.0 8.4 7.0 6.5 6.0
Bank Rate
Upside 3.5 3.0 3.0 3.0 3.0 3.5 3.5 3.5 3.3 3.3
Core 3.8 3.8 3.8 3.8 3.8 4.0 3.8 3.8 3.8 3.5
Downturn 3.3 2.5 2.5 3.0 3.0 4.8 4.3 4.3 4.3 4.3
Severe Downturn 5.8 5.5 5.0 5.0 5.0 6.5 5.5 5.0 5.0 4.5
Weightings
The following table shows the expected credit loss under each of our four
economic scenarios along with the weightings that have been applied to arrive
at the weighted average ECL. PMAs are calculated using the weighted scenario
results and so their sensitivity in each of the individual scenarios cannot be
accurately determined. For completeness they have been included as a uniform
adjustment across each scenario.
30 June 2025 31 December 2024
Weighted ECL Weighted ECL
Scenario % £m % £m
Upside 10 39.3 10 39.1
Core 60 41.8 60 41.4
Downturn 20 87.5 20 83.7
Severe downturn 10 127.1 10 130.2
Probability weighted ECL 100 59.2 100 58.6
A modelling approach using quantitative analysis is applied to assess the
weightings which uses industry-level write-off data to infer the Society's
loss rates over the period, as internal loss data is not available to
establish a historical loss rate distribution which reflects the nature of our
losses (i.e. relatively low losses in 'normal' times but the potential to make
more substantial losses in recessionary conditions). An econometric model was
developed which could be used to infer future loss rates based on a range of
different economic scenarios.
The loss rates were mapped under each of the IFRS 9 economic scenarios to the
historical loss rate distribution and using the distribution-defined
probabilities of each loss rate being realised to derive relative likelihoods
of each scenario occurring. SME judgment is then applied in the final
assessment of weights, informed by assessment of the quantitative
analysis/model.
The UK has agreed trade deals with India, the EU and the US, which are all
positive for UK GDP. The uncertainty and risks of global slowdown already
encapsulated in the scenarios. All of this has been considered and the
weightings have been maintained from 31 December 2024.
Despite the positive change to economics the ECL has increased across all
scenarios, except for the Severe Downturn. This is because a higher ECL
provision is being allocated to each mortgage, due to an increase in risk
across the book. The positive changes to the Severe Downturn scenario have
more than offset this increase in risk.
Post Model Adjustments
A post model adjustment (PMA) is applied when a change in credit risk is
identified that is not effectively captured in the expected credit loss
models.
PMAs are reviewed by SMEs throughout the year to determine whether the
identified risks are still applicable and whether any new risks have arisen.
The PMAs applied at 30 June 2025 are as follows:
30 June 2025 31 December 2024
£m £m
Model Performance 11.3 10.6
Affordability 1.1 1.2
Other 0.7 0.9
Total PMA 13.1 12.7
Model Performance
PD Underprediction
The Society's Gen 4 models were first used as the basis of the Society's ECL
in 2023. A level of probability of default (PD) underprediction, that was
observed within the Gen 3 models, was also seen in the new Gen 4 models. A PMA
has been established to adjust the PD estimates used to establish ECLs.
Accounts are then re-staged if their revised PD estimate exceeds the
significant increase in credit risk (SICR) threshold for the risk grade.
Predictive accuracy monitoring on a perfect foresight basis has been developed
by the Society to evaluate the risk. This monitoring has been produced at a
product level over a range of outcome periods. The results for each portfolio
were evaluated and the need for an adjustment was acknowledged. The
under-prediction factors for Prime and BTL have been incorporated into PD
estimates by directly uplifting the estimate by the associated
under-prediction factor and recalculating staging and ECLs using the adjusted
PD value.
The current PMA has been refreshed for half-year to ensure that the model
outputs reflect the level of risk experienced.
Sensitivity of Models to Economic Stresses
The PD model has displayed limited sensitivity to the different economic
scenarios because of the benign economic conditions in the data period used to
develop the model. A narrow range in average PD estimates across the four
economic scenarios of differing severity highlighted the model weakness. A PMA
has been established to mitigate against the lack of sensitivity in IFRS 9 PDs
to economic factors.
The PD Sensitivity PMA remains consistent with 2023 and 2024 reporting, though
refreshed for the latest portfolio and economic scenarios.
Affordability
The PMA was established by considering affordability levels of the mortgage
book by applying a stress to the monthly expenditure amounts such as increase
in outgoings, interest rate changes, cost-of-living challenges and income
decreases. These elements are used to identify accounts that would be most
vulnerable to stresses and find their mortgage unaffordable. PD allocation of
the accounts identified as vulnerable to affordability stresses is uplifted to
the equivalent of what they would need to be for the model to assign them to
Stage 2 as a result of meeting the SICR criteria.
Further consideration was given to segments of the book that have been
under-represented in this assessment and the Group considered whether the
coverage in those areas was sufficient. Relative insensitivity to the stresses
provided above was found and so additional provision was raised to cover this
underestimation.
Since year end, the PMA has been refined and reduced as actual increases in
credit risk in relation to affordability have materialised and are being
captured within the models or where inflation levels and associated forecasts
have moved more favourably in the first half of 2025.
This PMA will be monitored as we progress through the year and will be held
until a sufficient reduction in inflation and cost-of-living pressures is
observed.
Other
Whilst we incorporate a range of economic assumptions in the scenarios and
weightings used to calculate ECL, the approach still has limitations that
require a PMA to account for the additional risk. The PMA detailed below aims
to cover the Climate risk not currently built into the models.
Climate risk
The Group has assessed the risks associated with climate change, both physical
and transitional, in the context of ECL and concluded that the majority of
these risks (other than the risks detailed below) do not meet the requirements
for recognition as:
· There have been no observed climate related defaults and
therefore no identifiable significant increase in credit risks ('SICR');
· and the material transition risks identified are expected to
occur over a timescale in excess of the current behavioural life of our
portfolio (i.e. the average term before a customer either moves onto an
alternative deal or transfers to another provider) and, as such, any potential
impact would be against loans yet to be underwritten.
This PMA aims to identify properties which are or will in the near future be
at most risk from a climate perspective and assess the additional ECLs that we
could expect to incur if material costs/reductions to the value of security
arise from those risks. The four main risks considered are Energy Performance
Certificate (EPC) impacts, flood risk, subsidence risk and coastal erosion
risk.
A similar approach has been taken within each of these areas where the
properties with the very highest risks associated are identified, appropriate
adjustments are applied to the valuation of the properties and the impacts of
these changes then quantified and held as a PMA. The total PMA held is £0.7
million (31 December 2024: £0.9 million).
Staging and POCI
The tables below show the staging of loans and advances to customers,
including those considered to be purchased or originated credit impaired
('POCI'). The discount on acquisition is recognised in the fair value credit
adjustment.
The Group has £270.8 million of POCI loans (31 December 2024: £290.4
million). Of these, 84% (31 December 2024: 84%) are considered performing
loans but are not permitted to be reclassified to Stage 1 or 2. Problem loans
represent the total of the Group's Stage 3 balances and the non-performing
portion of our POCI loans.
Details of the movements in staging are explained in the Movement analysis
section of this note.
30 June 2025 31 December 2024
£m % £m %
Gross exposures by stage
Stage 1 45,208.5 89.3 44,489.2 89.4
Stage 2 4,598.3 9.1 4,458.8 9.0
Stage 3 547.7 1.1 520.1 1.0
POCI 270.8 0.5 290.4 0.6
Total gross exposures 50,625.3 100.0 49,758.5 100.0
Problem loans (stage 3 plus non-performing POCI) 591.9 1.2 566.9 1.1
ECL and coverage ratio by stage
Stage 1 7.0 - 7.8 -
Stage 2 25.6 0.6 23.5 0.5
Stage 3 17.5 3.2 16.7 3.2
POCI 9.1 3.4 10.6 3.7
Total ECL 59.2 0.1 58.6 0.1
The following table shows the staging split by days overdue.
Gross exposure ECL
30 June 2025 31 December 2024 30 June 2025 31 December 2024
£m £m £m £m
Stage 1 45,208.5 44,489.2 7.0 7.8
Stage 2: 4,598.3 4,458.8 25.6 23.5
Less than 30 days past due 4,375.2 4,279.8 21.3 20.9
More than 30 days past due 223.1 179.0 4.3 2.6
Stage 3: 547.7 520.1 17.5 16.7
Less than 30 days past due 246.8 234.7 2.8 3.1
30-90 days past due 110.5 96.4 1.8 1.3
More than 90 days past due 190.4 189.0 12.9 12.3
POCI: 270.8 290.4 9.1 10.6
Less than 30 days past due 236.1 254.5 7.0 8.0
30-90 days past due 20.4 20.5 1.0 1.2
More than 90 days past due 14.3 15.4 1.1 1.4
Total 50,625.3 49,758.5 59.2 58.6
All accounts in stage 1 are less than 30 days past due.
Risk Assessment
The following tables are included to give an overview of the Group's credit
risk.
Lending by Risk Grade
The risk models cover the majority of loans underwritten by the Group, with
exceptions for portfolios subject to bespoke modelling requirements, mainly
Accord Mortgages Limited buy-to-let (Accord BTL), commercial lending and POCI
accounts. The Accord BTL population currently has very strict underwriting
criteria and limited behavioural history. Commercial lending has significantly
different behavioural characteristics to the retail mortgages.
Gross exposures in the table below are presented pre PMAs being applied.
30 June 2025 31 December 2024
Gros E G E
s C r C
expos L o L
ure s
s
e
x
p
o
s
u
r
e
Stage 1 Stage 2 Stage 3 POCI Total
Probability of default range £m £m £m £m £m £m £m £m
0.00%-<0.15% 28,349.5 1,359.5 - - 29,709.0 0.7 29,258.4 0.8
0.15%-<0.25% 4,566.2 256.4 - - 4,822.6 0.5 4,703.9 0.5
0.25%-<0.50% 1,392.7 124.5 - - 1,517.2 0.3 1,531.7 0.3
0.50%-<0.75% 869.7 147.6 - - 1,017.3 0.3 1,021.6 0.3
0.75%-<1.00% 776.6 309.1 - - 1,085.7 0.5 1,042.5 0.5
1.00%-<2.50% 333.6 1,169.3 - - 1,502.9 2.8 1,396.2 2.7
2.50%-<10.0% 21.0 351.4 - - 372.4 2.5 364.3 2.4
10.0%-<100% 16.2 211.1 - - 227.3 3.2 173.2 2.5
Default - - 532.8 37.2 570.0 18.1 541.1 17.2
Accord buy-to-let 6,648.2 446.9 10.9 - 7,106.0 4.4 7,159.6 4.8
Commercial 2,143.2 201.9 4.0 6.9 2,356.0 5.9 2,205.8 7.4
Other 91.6 20.6 - 226.7 338.9 6.9 360.2 7.9
PMAs - - - - 13.1 - 11.3
Total 45,208.5 4,598.3 547.7 270.8 50,625.3 59.2 49,758.5 58.6
Lending by origination year
30 June 2025 31 December 2024
Gross E G E
expos C r C
ure L o L
s
s
e
x
p
o
s
u
r
e
Stage 1 Stage 2 Stage 3 POCI Total
Origination year £m £m £m £m £m £m £m £m
2025 3,474.4 172.2 8.0 - 3,654.6 1.5 - -
2024 8,562.3 594.1 33.9 - 9,190.3 6.6 9,501.2 4.6
2023 7,353.8 644.8 55.0 - 8,053.6 9.2 8,542.4 7.3
2022 7,224.7 617.8 54.3 - 7,896.8 7.6 8,191.6 7.3
2013 - 2021 16,921.3 1,803.1 218.4 - 18,942.8 14.9 20,404.7 17.8
2009 - 2012 600.3 71.6 9.3 - 681.2 0.4 735.8 0.3
Pre-2009 500.4 431.0 102.2 - 1,033.6 3.2 1,115.6 3.8
Acquired loans 571.3 263.7 66.6 270.8 1,172.4 15.8 1,267.2 17.5
Total 45,208.5 4,598.3 547.7 270.8 50,625.3 59.2 49,758.5 58.6
Lending by Loan to value
30 June 2025 31 December 2024
Gross G
expos r
ure o
s
s
e
x
p
o
s
u
r
e
Stage 1 Stage 2 Stage 3 POCI Total
Loan to value £m £m £m £m £m £m
Less than 60% 19,267.8 3,439.4 322.9 242.3 23,272.4 22,403.3
60% to 75% 14,219.2 688.1 135.3 21.4 15,064.0 14,889.3
75% to 90% 10,706.5 429.7 81.2 4.0 11,221.4 10,836.7
90% or greater 1,015.0 41.1 8.3 3.1 1,067.5 1,629.2
Total 45,208.5 4,598.3 547.7 270.8 50,625.3 49,758.5
Average LTV (%) 51.6 39.7 44.1 37.5 50.5 51.0
Movement analysis
The following table details the movement in the gross exposures and ECL from
the beginning to the end of the reporting period split by stage.
Mortgage balances in Stage 2 have increased by £139.5 million across 2025,
and the ECL associated with loans moving from Stage 1 to Stage 2 has increased
by £4.0 million. This is due to the type of mortgages that are transferring
between stages. £2,551.3 million of loans have moved into Stage 2 from Stage
1 and are primarily newer lending, with longer terms and higher LTVs. These
factors lead to a higher calculated ECL. The total mortgage balance coming out
of Stage 2 into Stage 1 is £433.7 million, these mortgages are generally much
lower risk, lower LTV and shorter-term with lower ECLs, shown by the £2.8
million reduction in ECL.
Stage 1 Stage 2 Stage 3 POCI Total
£m £m £m £m £m
Gross exposure at 31 December 2024 44,489.2 4,458.8 520.1 290.4 49,758.5
Transfers from stage 1 to 2 (2,551.3) 2,551.3 - - -
Transfers from stage 1 to 3 (46.4) - 46.4 - -
Transfers from stage 2 to 1 433.7 (433.7) - - -
Transfers from stage 2 to 3 - (74.8) 74.8 - -
Transfers from stage 3 to 1 12.7 - (12.7) - -
Transfers from stage 3 to 2 - 35.5 (35.5) - -
Changes to carrying value 1,184.0 (1,830.7) 3.2 (5.0) (648.5)
New financial assets originated or purchased 3,557.6 - - - 3,557.6
Financial assets derecognised during the period (1,871.0) (108.1) (42.7) (13.5) (2,035.3)
Write-offs - - (5.9) (1.1) (7.0)
Gross exposure at 30 June 2025 45,208.5 4,598.3 547.7 270.8 50,625.3
ECL at 31 December 2024 7.8 23.5 16.7 10.6 58.6
Transfers from stage 1 to 2 (0.2) 4.8 - - 4.6
Transfers from stage 1 to 3 - - 1.5 - 1.5
Transfers from stage 2 to 1 0.1 (2.8) - - (2.7)
Transfers from stage 2 to 3 - (1.0) 2.5 - 1.5
Transfers from stage 3 to 1 - - (0.3) - (0.3)
Transfers from stage 3 to 2 - 0.2 (0.4) - (0.2)
Changes in PDs/LGDs/EADs (1.5) 0.9 1.4 (0.8) -
New financial assets originated or purchased 1.0 - - - 1.0
Changes to model assumptions and methodologies (0.1) 0.3 (0.4) - (0.2)
Unwind of discount - - 0.4 0.2 0.6
Financial assets derecognised during the period (0.1) (0.8) (2.0) (0.7) (3.6)
Write-offs - - (1.8) (0.2) (2.0)
PMA - 0.5 (0.1) - 0.4
ECL at 30 June 2025 7.0 25.6 17.5 9.1 59.2
Loans Purchased or Originated Credit Impaired (POCI)
Up to date for the last 24 months Some arrears in the last 24 months Meets definition of default Total
£m £m £m £m
At 30 June 2025
Gross exposure 182.9 43.7 44.2 270.8
ECL 4.5 2.6 2.0 9.1
At 31 December 2024
Gross exposure 195.9 47.7 46.8 290.4
ECL 5.6 2.7 2.3 10.6
The table below shows the status of the Group's POCI loans. A substantial
proportion of POCI balances, were they not required to be classified as Stage
3 by accounting standards, would transfer to other stages. The table below
shows that 67.5% (31 December 2024: 67.5%) of balances have been fully up to
date for the last 24 months and only 16.3% (31 December 2024: 16.1%) of
balances would be classified as in default.
9. Retirement benefit obligations
Reconciliation of funded defined benefit scheme
30 June 2025 30 June 2024 31 December 2024
£m £m £m
Present value of defined benefit obligation (500.7) (532.7) (509.3)
Assets at fair value 528.8 573.0 542.3
Funded defined benefit asset 28.1 40.3 33.0
Unfunded defined benefit scheme
30 June 2025 30 June 2024 31 December 2024
£m £m £m
Present value of unfunded defined benefit scheme (7.1) (7.6) (7.4)
The present value at 30 June 2025 of the unfunded defined benefit scheme was
£7.1million (31 December 2024: £7.4 million) and the relevant disclosures
have been separated from those of the main employee benefits scheme where
appropriate.
The present value of the defined benefit obligation as at 30 June 2025 has
been calculated using assumptions that are derived consistently with those
used for the 31 December 2024 year end, allowing for updated market
conditions.
Liabilities have decreased as a result of corporate bond yields increasing due
to persistent inflation and high borrowing costs, which has subsequently
increased the discount rate. Future long-term expectations of inflation have
decreased slightly.
Asset returns over the first half of the year have been less than the discount
rate. The overall surplus has decreased by £4.6 million since 31 December
2024, due to both the assets and liabilities reducing as yields have risen,
with assets falling to a larger degree than the liabilities.
Summary of assumptions
30 June 2025 31 December 2024
% pa % pa
Retail prices index (RPI) inflation 3.1 3.3
Consumer price index (CPI) inflation 2.5 2.7
Discount rate 5.6 5.5
Salary increases 3.8 3.9
10. Related parties
During the six months ended 30 June 2025, mortgage lending to key management
personnel and their close family members was conducted in the ordinary course
of business and on standard commercial terms. One such loan was completed
during the period.
The outstanding balance as at 30 June 2025 was £499k (31 December 2024:
£nil). Interest paid and received by key management personnel and their close
family members was in line with rates available to all members.
Fees and commissions were paid by key management personnel or their close
family members during the period, on the same terms and conditions applicable
to members and other employees.
There have been no material changes to related parties or related party
transactions in respect of deposits since the year end. Further details can be
found on pages 213 to 214 of the 2024 Annual Report and Accounts.
11. Notes to the consolidated statement of cash flows
Half-year to Half-year to Year to
30 June 2025 30 June 2024 31 December 2024
£m £m £m
Non-cash or non-operating items included in profit before tax:
Depreciation and amortisation 7.3 10.0 23.7
Profit/loss on sale of assets (0.3) 0.3 -
Interest on subordinated liabilities 1.7 37.4 76.7
Impairment charge for the year 2.0 10.7 0.2
Provisions charge/(release) 0.2 (0.2) 1.3
Non-cash movement in subordinated liabilities 62.0 5.9 (25.8)
(Gain)/loss on realisation of debt securities (0.9) 0.1 1.5
Non-cash or non-operating items included in profit before tax 72.0 64.2 77.6
(Increase)/decrease in operating assets:
Change in loans and advances to customers and related fair value adjustments (1,259.2) (1,960.6) (3,050.6)
for hedged risk, excluding impairment
Derivative financial assets 535.8 (38.1) 297.3
Decrease in cash ratio deposit, other assets and non-OCI element of retirement 3.4 176.5 176.0
benefit surplus
Net increase in operating assets (720.0) (1,822.2) (2,577.3)
Increase/(decrease) in operating liabilities:
Shares and related fair value adjustments for hedged risk (232.9) 2,580.9 4,988.7
Amounts owed to credit institutions (216.1) (1.2) (717.4)
Non cash movements on debt securities 109.6 (56.3) (14.3)
Other deposits 232.9 217.8 213.2
Derivative financial liabilities (121.9) (19.9) (141.6)
Cash movements in other liabilities and provisions 7.2 (1.8) 5.9
Net (decrease)/increase in operating liabilities (221.2) 2,719.5 4,334.5
The following tables reconcile liabilities arising from financing activities.
Liabilities from financing activities Brought forward Cash flows Non-cash changes caused by: Carried forward
Redemption Issue Foreign exchange Accrued interest Fair value adjustments
Period to 30 June 2025 £m £m £m £m £m £m £m
Debt securities in issue 5,019.3 (82.5) 507.6 79.3 (7.0) 37.3 5,554.0
Subordinated liabilities 1,453.3 (25.6) - - 33.2 28.8 1,489.7
Total 6,472.6 (108.1) 507.6 79.3 26.2 66.1 7,043.7
Period to 30 June 2024
Debt Securities in issue 4,919.4 (1,006.4) 1,178.6 (55.7) (1.7) 1.1 5,035.3
Subordinated liabilities 1,621.7 (142.5) - - 31.1 (25.2) 1,4851
Total 6,541.1 (1,148.9) 1,178.6 (55.7) 29.4 (24.1) 6,520.4
Year to 31 December 2024
Debt securities in issue 4,919.4 (1,429.4) 1,543.6 (104.7) 5.9 84.5 5,019.3
Subordinated liabilities 1,621.7 (142.6) - - (3.0) (22.8) 1,453.3
Total 6,541.1 (1,572.0) 1,543.6 (104.7) 2.9 61.7 6,472.6
12. Fair values
Fair value is the price that would be paid upon the purchase of an asset or
received upon the sale of a liability in an arm's length transaction between
two entities at a specific measurement date.
Where external market prices are available these are used to determine the
fair value. When these are not available, internal pricing models using
external market data are used. The following hierarchy is used when measuring
fair value:
· Level 1: Quoted prices are available for identical assets or
liabilities in active markets, these are unadjusted.
· Level 2: Significant inputs to the calculated fair values are
taken from observable market data, other than those in Level 1. This may
include direct inputs (i.e. prices) or indirect inputs (i.e. derived from
prices).
· Level 3: Fair value is derived from non-observable inputs and not
solely based on external market data.
The table below summarises the carrying value and fair value of financial
assets and liabilities measured at amortised cost as at the Balance Sheet
date.
Held at amortised cost Carrying value Fair values Total fair value
Level 1 Level 2 Level 3
30 June 2025 £m £m £m £m £m
Assets
Loans and advances to credit institutions 1 651.0 - 651.0 - 651.0
Loans and advances to customers 2 50,571.7 - - 50,364.6 50,364.6
Debt securities - amortised cost 581.6 581.0 - - 581.0
Liabilities
Shares 3 51,769.4 - 51,723.2 - 51,723.2
Amounts owed to credit institutions 952.8 - 952.8 - 952.8
Other deposits 1,429.7 - 1,429.7 - 1,429.7
Debt securities in issue 5,554.0 4,830.8 724.4 - 5,555.2
Subordinated liabilities 4 1,489.7 1,516.9 - - 1,516.9
30 June 2024
Assets
Loans and advances to credit institutions 1 568.9 - 568.9 - 568.9
Loans and advances to customers 2 48,840.2 - - 47,586.8 47,586.8
Debt securities - amortised cost 2,091.7 2,086.8 - - 2,086.8
Liabilities
Shares 3 49,637.6 - 49,745.8 - 49,745.8
Amounts owed to credit institutions 1,885.1 - 1,885.1 - 1,885.1
Other deposits 1,201.4 - 1,201.4 - 1,201.4
Debt securities in issue 5,035.3 4,471.9 584.2 - 5,056.1
Subordinated liabilities 4 1,485.1 1,476.5 27.6 - 1,504.1
31 December 2024
Assets
Loans and advances to credit institutions 1 590.0 - 590.0 - 590.0
Loans and advances to customers 2 49,705.5 - - 49,119.8 49,119.8
Debt securities - amortised cost 1,091.1 1,094.2 - - 1,094.2
Liabilities
Shares 3 52,044.4 - 51,938.3 - 51,938.3
Amounts owed to credit institutions 1,168.9 - 1,168.9 - 1,168.9
Other deposits 1,196.8 - 1,196.8 - 1,196.8
Debt securities in issue 5,019.3 4,218.8 806.8 - 5,025.6
Subordinated liabilities 4 1,453.3 1,464.6 26.8 - 1,491.4
1. The fair values of all cash in hand, balances with the Bank of
England and loans and advances to credit institutions have been measured at
par as they are all due in under one year.
2. The fair value of loans and advances to customers is assessed as the
value of the expected future cash flows. Future cash flows are projected using
contractual interest payments, contractual repayments and the expected
prepayment behaviour of borrowers. The resulting expected future cash flows
are discounted at current market rates to determine fair value.
For standard variable rate mortgage products, the interest rate on such
products is equivalent to a current market product rate and as such the Group
considers the fair value of these mortgages to be equal to their carrying
value. Fixed rate mortgages have been discounted using current market product
rates. The difference between book carrying value and fair value results from
market rate volatility relative to the fixed rate at inception of the loan; in
addition to assumptions applied in relation to redemption profiles, which are
regularly reviewed and updated where necessary.
As these redemption profiles are not considered to be observable by the
market, then the fair value of loans and advances to customers continues to be
a Level 3 valuation technique. Overall, the fair value is lower than the
carrying value by £207.1 million (31 December 2024: £585.7 million lower),
which arises primarily due to the fair value losses being calculated on a
lifetime basis for all mortgage accounts.
3. All the Group's non-derivative financial liabilities are initially
recorded at fair value less directly attributable costs and are subsequently
measured at amortised cost. The only exception is where an adjustment is made
to certain fixed rate shares balances that are in hedging relationships. The
fair value of shares and deposits that are available on demand approximates to
the carrying value. The fair value of fixed term shares and deposits is
determined from the projected future cash flows from those deposits,
discounted at the current market rates. In 2025, the estimated fair value of
share balances, using a Level 2 method, is lower than the carrying value by
£46.2 million (31 December 2024: £106.1 million lower).
4. The Group's accounts include some subordinated liabilities classified
as Level 2 as fair values are calculated using a method based on observable
market prices. The fair value of subordinated liabilities, which is a fixed
rate product, is lower than the carrying value due to the volatility in market
rates over the course of the year.
5. The Group's accounts include investments in controlled entities and
amounts owed to subsidiary undertakings, for which the carrying value is
deemed a reasonable approximation of fair value.
The table below classifies all financial instruments held at fair value
according to the method used to establish the fair value.
Held at fair value Fair values Total fair value
Level 1 Level 2 Level 3
30 June 2025 £m £m £m £m
Debt securities - fair value through income statement 28.5 - - 28.5
Debt securities - fair value through other comprehensive income 6,612.1 - - 6,612.1
Derivative financial assets - 931.1 - 931.1
Investments - - 1.6 1.6
Derivative financial liabilities - 433.9 - 433.9
30 June 2024
Debt securities - fair value through income statement 27.3 - - 27.3
Debt securities - fair value through other comprehensive income 5,745.3 - - 5,745.3
Derivative financial assets - 1,790.1 2.9 1,793.0
Investments - - 3.2 3.2
Derivative financial liabilities - 677.5 - 677.5
31 December 2024
Debt securities - fair value through income statement 27.6 - - 27.6
Debt securities - fair value through other comprehensive income 7,302.6 - - 7,302.6
Derivative financial assets - 1,466.0 0.9 1,466.9
Investments - - 1.6 1.6
Derivative financial liabilities - 555.8 - 555.8
The Group's Level 1 portfolio of fair value through income statement and fair
value through other comprehensive income debt securities comprises liquid
securities for which traded prices are readily available.
Derivative financial instruments are included within Level 2 as fair values
are derived from discounted cash flow models using yield curves based on
observable market data.
Level 3 instruments
Investments classified in Level 3 relate to the Group's holding in equity
preference shares. These shares are convertible into common equity shares at
various intervals during the life of the instrument. This is based on a
conversion factor set by the issuer. The valuation method therefore uses the
quoted share price of the unrestricted stock as a base, applies the current
estimated conversion factor as advised by the issuer and applies a discount.
This discount reflects the current illiquidity of the instrument and the risks
to changes in the conversion factor between the balance sheet date and the
next conversion date. Whilst the valuation is primarily based on an observable
market price, the level and significance of the unobservable input relating to
the calculation of the discount moves this asset into Level 3.
Changes in the carrying value of Level 3 financial instruments in the period
relate to the redemption of a derivative financial instrument and changes in
fair value. There have been no changes in methodology, additions or transfers
in or out of Level 3 in the year.
13. Events occurring after the end of the reporting period
There have been no material post balance sheet events between 30 June 2025 and
the approval of the condensed interim financial statements.
Responsibility Statements
The directors confirm, to the best of their knowledge:
· the condensed set of financial statements have been prepared in
accordance with UK-adopted International Accounting Standard 34 Interim
Financial Reporting; and
· the condensed set of financial statements give a true and fair
view of the assets, liabilities, financial position and profit or loss of
Yorkshire Building Society and its controlled entities ("the Group"); and
· the interim management report includes a fair review of the
information required by DTR 4.2.7R (indication of important events during the
first six months and description of principal risks and uncertainties for the
remaining six months of the year).
By order of the Board
Susan Allen, OBE
Chief Executive Officer
23 July 2025
Tom Ranger
Chief Financial Officer
23 July 2025
Independent review report to Yorkshire Building Society
Report on the condensed consolidated interim financial statements
Our conclusion
We have reviewed Yorkshire Building Society's condensed consolidated interim
financial statements (the "interim financial statements") in the Half-Yearly
Financial Report of Yorkshire Building Society for the 6 month period ended
30 June 2025 (the "period").
Based on our review, nothing has come to our attention that causes us to
believe that the interim financial statements are not prepared, in all
material respects, in accordance with UK adopted International Accounting
Standard 34, 'Interim Financial Reporting' and the Disclosure Guidance and
Transparency Rules sourcebook of the United Kingdom's Financial Conduct
Authority.
The interim financial statements comprise:
· the Consolidated Balance Sheet as at 30 June 2025;
· the Consolidated Income Statement and Consolidated Statement of
Comprehensive Income for the period then ended;
· the Consolidated Statement of Cash Flows for the period then
ended;
· the Consolidated Statement of Changes in Members' Interest and
Equity for the period then ended; and
· the explanatory notes to the interim financial statements.
The interim financial statements included in the Half-Yearly Financial Report
of Yorkshire Building Society have been prepared in accordance with UK adopted
International Accounting Standard 34, 'Interim Financial Reporting' and the
Disclosure Guidance and Transparency Rules sourcebook of the United Kingdom's
Financial Conduct Authority.
Basis for conclusion
We conducted our review in accordance with International Standard on Review
Engagements (UK) 2410, 'Review of Interim Financial Information Performed by
the Independent Auditor of the Entity' issued by the Financial Reporting
Council for use in the United Kingdom ("ISRE (UK) 2410"). A review of interim
financial information consists of making enquiries, primarily of persons
responsible for financial and accounting matters, and applying analytical and
other review procedures.
A review is substantially less in scope than an audit conducted in accordance
with International Standards on Auditing (UK) and, consequently, does not
enable us to obtain assurance that we would become aware of all significant
matters that might be identified in an audit. Accordingly, we do not express
an audit opinion.
We have read the other information contained in the Half-Yearly Financial
Report and considered whether it contains any apparent misstatements or
material inconsistencies with the information in the interim financial
statements.
Conclusions relating to going concern
Based on our review procedures, which are less extensive than those performed
in an audit as described in the Basis for conclusion section of this report,
nothing has come to our attention to suggest that the directors have
inappropriately adopted the going concern basis of accounting or that the
directors have identified material uncertainties relating to going concern
that are not appropriately disclosed. This conclusion is based on the review
procedures performed in accordance with ISRE (UK) 2410. However, future events
or conditions may cause the group to cease to continue as a going concern.
Responsibilities for the interim financial statements and the review
Our responsibilities and those of the directors
The Half-Yearly Financial Report, including the interim financial statements,
is the responsibility of, and has been approved by the directors. The
directors are responsible for preparing the Half-Yearly Financial Report in
accordance with the Disclosure Guidance and Transparency Rules sourcebook of
the United Kingdom's Financial Conduct Authority. In preparing the Half-Yearly
Financial Report, including the interim financial statements, the directors
are responsible for assessing the group's ability to continue as a going
concern, disclosing, as applicable, matters related to going concern and using
the going concern basis of accounting unless the directors either intend to
liquidate the group or to cease operations, or have no realistic alternative
but to do so.
Our responsibility is to express a conclusion on the interim financial
statements in the Half-Yearly Financial Report based on our review. Our
conclusion, including our Conclusions relating to going concern, is based on
procedures that are less extensive than audit procedures, as described in the
Basis for conclusion paragraph of this report. This report, including the
conclusion, has been prepared for and only for the Society for the purpose of
complying with the Disclosure Guidance and Transparency Rules sourcebook of
the United Kingdom's Financial Conduct Authority and for no other purpose. We
do not, in giving this conclusion, accept or assume responsibility for any
other purpose or to any other person to whom this report is shown or into
whose hands it may come save where expressly agreed by our prior consent in
writing.
PricewaterhouseCoopers LLP
Chartered Accountants
Leeds
23 July 2025
Other information
The information set out in this document is unaudited and does not constitute
accounts within the meaning of section 73 of the Building Societies Act 1986.
The financial information for the year ended 31 December 2024 has been
extracted from the audited Annual Accounts for that year. The Annual Accounts
for the year ended 31 December 2024 have been filed with the Financial Conduct
Authority.
The Auditor's report on the Annual Accounts was unqualified and did not
include any matters to which the Auditor drew attention by way of emphasis
without qualifying their report.
A copy of the Half-Yearly Financial Report is placed on Yorkshire Building
Society's website. The directors are responsible for the maintenance and
integrity of the information on the website. Information published on the
internet is accessible in many countries with different legal requirements.
Legislation in the UK governing the preparation and dissemination of financial
statements may differ from legislation in other jurisdictions.
References to 'YBS Group' or 'Yorkshire Group' refer to Yorkshire Building
Society, the trading names under which it operates (Chelsea Building Society,
the Chelsea, Norwich & Peterborough Building Society, Norwich &
Peterborough and N&P) and its subsidiary companies.
Accord Mortgages Limited is authorised and regulated by the Financial Conduct
Authority. Accord Mortgages Limited is entered in the Financial Services
Register under registration number 305936. Buy to Let mortgages for business
purposes are not regulated by the Financial Conduct Authority. Accord
Mortgages Limited is registered in England No: 2139881. Registered Office:
Yorkshire House, Yorkshire Drive, Bradford BD5 8LJ. Accord Mortgages is a
registered Trade Mark of Accord Mortgages Limited.
FareShare is a registered charity in England & Wales (1100051) and
Scotland (SC052672).
Citizens Advice is an operating name of The National Association of Citizens
Advice Bureaux. Registered charity number 279057.
Arniston Ltd (t/a) Snugg is authorised and regulated by the Financial Conduct
Authority. FRN: 999500. Registered in Scotland. Company Number: SC707743.
Yorkshire Building Society is a member of the Building Societies Association
and is authorised by the Prudential Regulation Authority and regulated by the
Financial Conduct Authority and the Prudential Regulation Authority. Yorkshire
Building Society is entered in the Financial Services Register and its
registration number is 106085. Head Office: Yorkshire House, Yorkshire Drive,
Bradford BD5 8LJ. ybs.co.uk
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