Bradford-based Yorkshire Building Society said its balances increased by £5.1 billion to £47.1 billion in 2023 as profit before tax slipped 10% to £450.3 million.

The society increased its mortgage balances to £46.8 billion from £45.2 billion, providing 44,000 new residential mortgages (2022: 47,000).

Yorkshire said the savings rates it provided were on average 1.01 percentage points higher than the market average over 2023, equating to £441.1 million of additional interest paid.

A record 693,000 savings accounts were opened with the society in 2023.

Net interest income was £786.0 million in 2023, up £61.9 million. Net interest margin increased 1 basis point to 1.31% “as a result of effective trading strategies as well as the increases made to Bank Rate in the year.”

Yorkshire Building Society CEO Susan Allen said: “As I complete my first year as chief executive, I am proud to lead such a strong and sustainable organisation focused on supporting its members, customers and communities.

“More people are choosing us for their savings and, despite the mortgage market being much smaller in 2023, we increased our market share and one in three of our new owner-occupied mortgages was to a first-time buyer (FTB).

“Savings balances represent a primary source of financial wellbeing and, at times like these, the peace of mind that comes from having a rainy-day fund can make all the difference.

“Our own research, published within our Saving the Nation report, illustrated the dynamics of savings behaviour in the UK over the last five years and the widening gap between those who are able to save on a regular basis and those who are not.

“As a mutual, we don’t have external shareholders so we can return more to our members. During 2023, the rates we offered were on average 1.01 percentage points higher than the market average, which equates to £441.1m additional interest paid to our savers – more than double the amount when compared to 2022.

“We also launched a number of products for existing customers, which included our Loyalty Regular Saver and a one-year Fixed Rate bond.

“Providing support to our borrowers is also important to us. Research in our Home Truths report highlighted how home ownership is moving further out of reach for many.

“Product innovation under our Place to Call Home priority is one way we seek to support prospective borrowers. We have launched products through our intermediary lender, Accord Mortgages, which allow family members to support younger generations and we continue to explore ways to make our products available to a wider range of customers.

“We are also mindful of the challenges faced by our existing mortgage holders and our teams have worked hard to understand and respond to individual circumstances. We proactively reached out to customers most impacted by interest rate increases and we signed up to the government-led Mortgage Charter to help customers navigate the higher cost of living …

“As a mutual, it’s important to balance savings and mortgage growth. The Society is in a robust financial position and we’re continuing to increase our customer satisfaction scores. We’re committed to continuing to support members, customers and communities throughout 2024.

“With world events currently driving continued economic volatility, a good deal remains dependent on how the interest rate environment evolves, and the speed and efficacy at which monetary policy action can return inflation to the Bank of England’s target of 2%.

“Current market sentiment indicates we may have reached the end of Bank Rate rises though, as ever, this is subject to change.

“In such a context it becomes increasingly important that we invest our resources purposefully and selectively, focusing on the things that will bring the most benefit to our membership in the long term.

“Both 2022 and 2023 represent periods where our profits were higher than historical levels. This will help to protect the long-term interests of our membership, providing stability for when challenges crystallise, and allowing us to reinvest in our products and services.”