Manchester-based Co-op Bank announced its profit before tax soared to £61.9 million in the six months ended June 30, 2022, up from 21.4 million for the same period of the prior year.
The bank said that to help its staff cope with higher inflation and cost of living pressures, it will increase annual salaries by £1,000 from September.
“Total income, which includes net interest income and other operating income, has increased by 37% in comparison to the six months ended 30 June 2021 to £229.6m (1H 21: £168.0m),” said Co-op Bank.
“Net interest income has increased by 39% to £208.2m (1H 21: £149.4m) and net interest margin (NIM) has increased by 29 basis points (bps) from 122bps to 151bps, reflecting higher mortgage balances at improved margins.
“This is supported by improving deposit margins following increases in the base rate to 125bps. As a result, we have increased our expectations for the full year to c.155bps.”
Co-op Bank CEO Nick Slape said: “We have made significant progress in the delivery of our strategy in the first half of 2022.
“The statutory profit before tax of £61.9m and underlying profit before tax of £63.6m reflect sustained quarter-on-quarter growth.
“These results are better than anticipated at the start of the year and therefore, looking ahead, we have upgraded our outlook for 2022 whilst increasing the investment to be made available for customer service and simplification initiatives.
“Our low-risk balance sheet, along with the recent successful capital issuance, support our customer-focussed goals to grow the bank from an efficient and resilient foundation.
“While the economic outlook remains uncertain as we wait to see the full impact of higher inflation and cost of living pressures, we remain committed to helping customers and colleagues during these challenging times and services are available to anyone requiring support.
“We made the decision in the first quarter to make a one-off payment to lower-paid colleagues, and we have also committed that from September we will increase the annual salaries we pay to colleagues by £1,000 (full time equivalent).
“This change in base pay will apply to approximately 95% of colleagues across the bank, excluding those already on the highest salaries.”