Leeds Building Society said on Friday its assets have risen above £20 billion for the first time — up 6.9% to £20.7 billion from £19.4 billion at the end of 2018.

Announcing its 2019 first-half results, Leeds Building Society said it increased residential mortgage balances by 4.4% to £16.5 billion, up from £15.8 billion at December 31, 2018).

The UK’s fifth-biggest bulding mutual attracted 5.2% more savings balances — up to £14.6 billion compared to £13.9 billion at December 31.

However, half-year profit slipped 22% to £49.4 million from £60.1 million for the same period of 2018.

Leeds Building Society said: “The Society has demonstrated its continued support of its members by offering competitive products and services despite economic uncertainty.

“Sustained pressure on mortgage pricing and high levels of refinancing has translated into lower mortgage income and, without an equivalent reduction in funding costs, has suppressed net interest income.

“The underlying strength of the mortgage book remains high with a low level of arrears and continued high quality security; albeit a worsening view of forecast economic conditions has negatively impacted expectations of credit losses and resulted in increased charges for impairment loss provisions …

“CET1 and total capital ratios of 30.3% and 37.0% respectively are among the strongest risk-based measures of any UK bank or building society and the leverage ratio of 5.4% is well above regulatory requirements.”

Leeds Building Society CEO Richard Fearon said: “The Society stays true to the purpose for which it was founded, to help people save and have the home they want, and we continue to lend responsibly and grow in a prudent and carefully-managed way.

“This is despite the challenging headwinds in the UK economy and the impact of cooling consumer confidence.

“As expected, increased competition and the effects of slowing economic growth have had an impact on our profit levels.

“Similarly, we knew our ongoing investment in member value and our digital capabilities would affect profits – while these have reduced this year they remain at a healthy level.

“Our cost to income and cost to mean asset ratios of 49.4% and 0.50% respectively are among the best in the sector, and we retain our keen cost focus.

“Following planned high levels of growth over several years, the Society has made a conscious choice to moderate increases in mortgage and savings balances to focus on margin.

“We’ll continue to pursue our strategy of supporting borrowers who are not well-served by the wider market – such as through Shared Ownership, Interest Only and Buy to Let – as we keep looking for new ways to respond to the evolving needs of our members …

“As a mutual, we need to balance the needs of our whole membership, whether borrowers or savers, and whilst we cannot ignore the impact of continued low interest rates in the market, we work hard to keep savings rates as high as possible for as long as possible in what has been a historically low rate environment.

“We will carry on paying above the market average to our savers — on the latest data available, we paid 0.62% above the market average on our savings rates, equating to an annual benefit to our savers of over £84 million.”